MPs to cast closer eye on broadband ripoffs

Duff information makes duff decisions

Apart from the Digital Dividend Review (DDR), do you have any specific praise or criticisms related to how Ofcom uses evidence - things like surveys or market research - when it justifies its actions? one big piece of research Ofcom did was used to justify the junk food adverts aimed at children.

Should a regulator find out what people want? That's the politicians' job, isn't it? This is a problem Ofcom is facing more and more. To what extent is it a problem having political issues - delegated to it - as opposed to issues that can be resolved by appeal to objective fact. The DDR is a classic example of that.

In the whole debate about childhood obesity, how much of it was political prejudice and how much of it was objective fact? It's very difficult. So, I suppose my one concern is 'Are politicians asking too much of Ofcom?'

If you look at Ofcom, there is a fuzzy line between policy making and implementing policies that are contained in the statute or other government instructions. Is Ofcom therefore becoming a political organisation?

That's the question that lay behind some of the questions Parliament recently asked of Ofcom in the recent evidence session. I don't think it would want to, but of course there is lots concern about some of the appointments made there recently. I have to say I find people like Ed Richards very good to deal with. I have no complaints about the way they responded to my probing.

How do you rate Ofcom's performance on the DDR, initially and now? How have they started and how have they moved forward?

It's very interesting. Ofcom's first decision is that spectrum should be allocated by a market-based mechanism because they cannot make the judgments between competing uses. Philosophically I agree with that. But you do get into some very difficult decisions quite quickly. Two principles emerge from this, in my view:

The first is the extent to which Ofcom are being asked to take political decisions rather than market decisions. The question of HDTV - is it something that people have a right to get free of charge? And the hard-pressed broadcasters (and they are hard-pressed in the commercial and the state sector) haven't got extra money to spend on more spectrum. So, it's a political decision - I think Ofcom got a political decision delegated to them. I think it's been unreasonable.

The second issue is the quality of the technical information Ofcom brought to the debate. For the first time in my experience with Ofcom their technical information appeared to be severely deficient.

So they were taking political decisions on the basis of bad technical information.

You are referring to this question of how many HD signals could they get...?

Who is right and who is wrong? You've got to be very careful. The broadcasters will make one set of claims in their own commercial interests. But Ofcom seem to be well over the line with that advice. I was also referring to their complete failure to understand the use that spectrum is put to. They had employed consultants, they had done work, but just they hadn't got their facts right. And we had to work very hard to make Ofcom understand that the existing spectrum is used differently to the way they understood. They had incomplete estimates, for example, of unofficial unlicenced use. There were some very naïve assumptions made.

For an organisation that has always had a high reputation - as far as I am concerned - I've talked to ministers about this and they have said 'well if Ofcom think it, it must be all right' - and that was my prejudice to begin with as well, but take a look ...

So where did this go wrong? Was it a particular problem with an issue in this sector or was it an indicator of sloppiness within Ofcom more generally? I think that is a question the organisation has got to ask itself. They have admitted they got it wrong but they need to ask themselves why they got it wrong.

What implications does that have for them in terms of their perception going forward?

Well, they are going to be open to much more challenge now. I think about people like me who had worked under the assumption that it was a relatively benign organisation that did things broadly right. Now we are saying "hang on, they got that one wrong, let me make sure they got this one right". I think they will be open to more scrutiny as a result on the technical side of their work rather than on their judgments on issues of a more political nature.