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Brown's fist launches new gravy train broadband review

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The smart choice: opportunity from uncertainty

A new minister for business regulation was appointed last month. So inevitably, with a clearing of the throat and an impatient shuffling of the feet, it was only a matter of time before a new review into UK broadband adoption would be announced.

And here we are.

Business minister Baroness Shriti Vadera yesterday said that government would investigate any hold-ups to the adoption of high speed broadband in the UK. The review will be led by Francesco Caio, former Cable & Wireless CEO.

The review will "consider the possible barriers to any new models of investment" and, ominously, "examine whether there are opportunities to minimise the cost of private sector investment". The Broadband Stakeholder Group will be asked to examine if FTTH (Fibre to the Home) is feasible without first investing in FTTCAB (Fibre to the Cabinet).

It's a thorny issue, but when it comes to investment, fairly simple. Without a return, there's no incentive to invest, and with no money coming into the system (from services that people actually want to pay for), there'll be no investment.

Some lucky US web surfers have in recent years leapfrogged their UK counterparts; they can now use a chunk of their speedy new 100Mbit/s fibre connections (and enjoyed free speed-bumps along the way) courtesy of Verizon. But they're effectively paying for cable TV (delivered by IP-TV), and the broadband and phone line are icing on the cake.

So the question is - are the market players genuinely prepared to give these services a go, or will they be seeking "help" - from us, before the market been seen to work, or fail?

Wait and see

Kip Meek of the Broadband Stakeholder Group welcomed the review.

"Success will depend on securing the support of the big players - the BTs, the Skys and the Carphone Warehouses for example - but we're pleased government has put its imprimatur on that," he told us.

But isn't it a bit premature to burden the taxpayer before we could see these private investments (in IP-TV and 4G) had failed?

"There's no need to panic," he agreed.

"It's a long game, and it's perfectly possible to destroy economic value for a country by misdirecting investment. We're completely in favour of waiting until we've got the information, and evidence that's powerful and compelling, before any form of intervention is proceeded with. We're still at the evidence gathering phase."

Described as "Gordon Brown's representative on earth", Shriti Vadera has been the architect of two sell-offs in recent years: the sale of the British version of ARPA, the defence R&D labs Qinetiq, and the part-privatisation of the London Underground.

The Qinetiq sale was severely criticised by the audit office, as Lewis Page described here:

"The [MoD] didn't just sell off all our secrets and a lot of our assets and get (us) brutally shafted on the deal. They seem to have sold an unknown number of American secrets too, and created a perpetual, leaky, revolving back door through which more critical secret tech can dribble out."

On the other hand, as we now know, the part-privatisation of the London Underground is seen as a model for the world to follow. [shurely some mistake? -ed]

Large, spending-adverse telcos can form an orderly queue, here. ®

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