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Ofcom: It's about broadband, stupid

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Analysis So the Government has become the proud single parent of a bouncing new super communications regulatory agency, Ofcom, writes Tom Steinberg.

Of course, the focus in the mainstream media has been on what this Christmas birth means for the BBC and other TV companies. But this is akin to concentrating on the content of the child's nappy instead of the whole infant.

By far the most important subsection of Ofcom will be whatever replaces Oftel, the telecoms regulator. This is because the nature and cost of the broadband infrastructure, run by operators like BT and NTL, will be the single biggest determinant of what type of communications industry we have.

If Britain can develop an extensive and highly competitive broadband market, then this will force changes on the communications market, which Ofcom can then regulate. If it cannot, then OFCOM’s raison d’etre is pulled away from beneath its feet.

Ofcom was set up to deal with the problems of 'convergence', i.e. what to do as the boundaries between communications technologies start to blur. But there's a snag; if there is no widespread introduction of broadband services, there is no meaningful convergence.

If there is no convergence, there are no convergence problems to be solved. And if there are no convergence problems, there is no need for a converged regulator.

Unfortunately, the White Paper has been pitched as if the introduction of broadband can be taken for granted, and so is hardly worth mentioning. It is evident from this assumption that the writers of the Paper must have been using the Government's own high speed intranet, isolated from the real world where getting broadband is patchy, endlessly delayed, unreliable and expensive.

Unsurprisingly, big, politically painful structural changes, such as ending the cable franchise system, which reduces land line competition to a duopolistic farce, are nowhere in sight.

The saddest thing about the White Paper is the lack of real understanding about convergence. While Ofcom has nominally been created to deal with convergence, there are many signs that those writing it really can’t get their heads round the idea. The presentation of the White Paper was littered with references to TV and the Internet, and 'tiers' for dealing with them separately. The implicit expectation is that channel-based broadcast TV will be the major communications form for a long time to come. This should not be for the government to decide.

The real challenges presented by convergence seem to have been mostly passed over. There is no mention as to what the government will do, if, for example, a major media company moves abroad and starts broadcasting only over the Internet. Perhaps we should not be too surprised by such a lack of vision. The clumsy reference in the White Paper' foreword to "High-speed phone lines" will amuse those who found the naïve anti-criminal provisions in the RIP bill laughably easy to circumnavigate.

The government will have to do more than this White Paper suggests to convince us that it understands technology well enough to intelligently deal with problems as tough as regulating the internet. Luckily it is not too late, as much detail remains to be filled in. Suggestions anybody? ®

Tom Steinberg is a researcher and IT manager for a think tank, the Institute of Economic Affairs. The above views are his and his alone and have nothing to do with the Institute.

Related Link

The Communications White Paper

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