Government internet strategy is flawed says Lords committee
Steve Smith, head of thought leadership at Starcom MediaVest London, says: The recommendation about preparing for all television to be broadcast via the internet is especially pertinent given a growing number of households are likely to watch TV via a broadband connection…
In a report released today, The House of Lords Select Committee on Communications says that the government should prepare for all television broadcast to be transferred to the internet.
Indeed, the Committee suggests that strongest driver of people moving from basic to superfast broadband will be people wanting to access on-demand television.
We see this is the case right now during the Olympics. Over the past weekend, the BBC iPlayer saw 1.7 million requests for the Olympics opening ceremony. If the content that people want is available online, people will want to access it.
A caveat here is that this will need a much improved broadband network beyond the government’s target of having everyone able to get 2Mbps by 2015. The committee calls this target “flawed” and liable to widen the digital divide between those communities with fast internet access and those living in broadband blackspots.
Instead, the committee argues that the government should ensure that every home is eventually connected to the internet by fibre. Although BT has been rolling out fibre, with 11 million homes now connected, the committee highlights that BT is only installing fibre to street cabinets, with old and weather-sensitive copper wires carrying the signal to the doorstep.
The committee’s recommendation about preparing for all television to be broadcast via the internet is especially pertinent given a growing number of households are just as likely to watch TV via a broadband connection as they are to watch it via an aerial or satellite dish.
Recent figures from Ofcom show that the number of UK adults with home internet who catch up with TV via the internet at least once a week has climbed from 23% of all adults in 2008, to 37% in 2012. This is highest among 16-24s, 48% of who do this.
The choice of on-demand entertainment is set to grow. Sky, BT, Virgin Media and, as of last week, TalkTalk all now retail internet TV services bundled with a broadband connection. Ofcom data shows that average total of VoD views per month to Virgin Media homes has nearly tripled in four years, climbing from 33 million in 2008, to 90 million in 2012.
As someone who spent time researching in the technology and telecoms sector here and internationally, I can state that neither this Government or its predecessors have a had coherent strategy about the development of fast speed national broadband network for the UK. Central to this is that there has to be a view on what type of economy you want and what type of infrastructure you need to underpin it. If any Government wants to see what high speed fat data networks do, then don’t go to Korea, just look at what HMG sees as a critical part of our economy – the city. Do you think all that high speed financial dealing is still on dial up? If you want a thousand SME to bloom, then they need access to high speed technological networks.
This lack of a strategy is made worse by the fact that ministries who might fight for broadband have been continually out muscled by the larger transport ministries who want big boy physically visible toys like motorways and railways. The current HS2 debate centres on this – the cost of cutting 20 minutes off the time to Birmingham by train would buy a high speed broadband network for the whole of the UK, including the more rural, and in some instances more affluent parts of the UK. Building HS2 now is like the 19th century equivalent of getting into canals when all the smart money was going into railways.
What I do find odd is that the ad industry is putting more and more money into digital, yet none of the major industry bodies ever tries to lobby the Government to give us the type of networks that already exist in other parts of the world. Lots of talk about connected TV at the moment and this platform could radically alter the way the industry operates, but what if the sets are 21st century but the networks they depend on are not? Sir Martin Sorrell recently stated that we would be foolish not to believe that great creative would not come out of China. What happens to the UK ad industry if that great work is because other countries gets to grips with using platforms like connected TV because they have the infrastructure and we do not?