Do we need a broadband tax?

gallery

Investment

The scale of the funding challenge is enormous. Whichever party wins power at the 2010 election, a solution needs to be found. And not just a solution that will get Britain through the next few years. There are much longer term problems that have to be faced.

For let’s not forget too that the upgrading of communications lines around the country isn’t going to suddenly stop in 2012. Assuming, and it’s a tough target, that the government does manage to get things in place so that everyone enjoys a 2Mbps connection, the fast-pace of broadband evolution will demand fairly quickly that further upgrades follow not long thereafter. And there’s a big bill going to be associated with that too.

Already in major urban centres we’re seeing that fibre optic lines are being laid at not insignificant cost, and right now, it’s only in the interests of the likes of BT to do this where it will see a return on its investment.

Come 2015, for argument’s sake, could we have the next stage of the dial-up to broadband divide, with built up areas of the UK on 50Mbps+ connections, while rural areas struggle to get even a tenth of that? Would Lord Carter of Barnes then be employed to do a follow up report? And would we be looking at further raids on our pay packets to fund it?

No magic wand

The simple truth is that whatever tax or levy the government puts in place isn’t going to go away once the first stage of work is completed.

Private companies are as likely to be reluctant to pay for rural fibre optic upgrades as they are unwilling to invest in broadband lines to remote areas. As such, there’s a clear funding gap here that £150 million a year may not be able to plug.

That's the fear of critics of the levy. They believe that bringing it in at a seemingly reasonable rate of 50 pence a month would be a Trojan horse by which increases could be applied in subsequent years, to top up the amount needed from public finances to pay for the ongoing upgrading projects.

Realistically, that might have to happen even to cover the upgrade to 2Mbps for everyone by 2012, yet alone factoring in still faster speeds beyond that. And if the levy were abandoned altogether? There’s a genuine fear that the two-tier broadband access speed chasm that’s already developing in the UK will only get deeper.

This whole issue is one of many that’s likely to become a political hot potato in the months ahead, as technology steps into the middle of an election campaign where any issue is likely to be seized upon.

But it’s far more than a political football. Like it or lump it, Lord Carter of Barnes’ report at least had some suggestions. What’s going to be needed next is a longer term strategy, and one that’s going to by its very nature have a big bill attached. It’s how that bill’s going to be paid that’s going to partly define where broadband UK heads next, and how fast it gets there...

Email to a friend

Print this page