Now that the so-called broadband tax has been scrapped (along with the controversial Budget announced tax hike on cider) as Parliament gets ready to dissolve itself in the run up to a General Election, are those of us who follow the politics of technology meant to breathe a sigh of relief and go about our business? I don’t think so.

The Tories were against the 50p per month tax on everyone with a telephone landline, and indeed had said they would scrap it if it were voted in and then Labour was voted out. But for Labour it was a core element worth around £170 million a year towards the funding of that much publicised promise to get super-fast broadband to everyone. Has the broadband tax gone away for good then? The answer to that one would appear to depend on how the country votes on May 6th it would seem, with the Tories having no plans to bring it back while Labour would almost certainly seek to do so as a matter of some urgency.

So why was it scrapped, seeing as the Government could have rushed it through as part of the bundles of laws that are being bullied and hurried through Parliament so as to make the statute books before it dissolves? Now that’s an interesting one, and I suspect the answer can be summed up in three words: Digital Economy Bill. OK, some might suggest it was more to do with getting the Budget passed nice and quick, but I can’t help but wonder if there was an element of distraction involved, a tidbit to feed the geeks and take their mind off the Digital Economy Bill. If it was meant to be a distraction, it didn’t work. Indeed, only MPs appeared to get distracted and do something else other than attend the important second reading of the thing.

After a rather drawn out and tediously lightweight ‘debate’ in the House of Commons last night, the Digital Economy Bill has now passed a second reading and is due to be voted upon this week to determine if it becomes law or not. The debate, and I use that word with a lack of enthusiasm that can only be matched by the lack of enthusiasm shown by the Commons, was nothing short of a shambles. At one point there were only 15 MPs in the chamber, and at the peak of the thing no more than 40, while thousands of people who understand the technology and the impact that this duff bill will have on ordinary users and Internet businesses alike took part in a much more informed and reasoned debate online on Twitter for example.

You might have thought that, post the expenses scandal, MPs would start listening to the electorate and at least look like they give a damn about our opinions.

You might have thought that, with an election just around the corner, the views of the voters would take on a new sense of urgency.

You might have thought that the draconian measures being introduced to supposedly crack down on piracy would be exposed as a sledgehammer to a nut or, to put it in the perspective of other ill-judged knee jerk legislation rushed through Parliament, the erosion of our personal freedoms in order to calm irrational fears about domestic terrorism.

But, alas, no. It was the same old, same old. With very few, and as it turned out rather honourable mentions (Tom Watson MP take a bow) MPs just took the opportunity to stand up and rant about something they know precious little, and in some cases apparently absolutely bugger all, about. Even those such as Jeremy Hunt, Shadow Culture Secretary, who appeared to understand that the Bill was flawed stood and declared it should be passed anyway. WTF?

No wonder MPs are despised more than traffic wardens and tax inspectors these days…

Could tomorrow’s Budget be the most broadband friendly in history? The odds are looking good for some pre-Election bribery in the form of Super-Fast Broadband for All it would seem. Gordon Brown has already announced plans for every citizen to get a government services web page of their very own, accessed by super-fast broadband which the PM refers to as the electricity of the digital age.

Of course, there’s the small matter of how you pay for all of this. Which is where the Budget on Wednesday comes in. It looks likely that there will be an element of taxation in the form of a land line levy of around £6 for every land line, which is already being referred to as the broadband tax. It’s also expected that the Chancellor of the Exchequer, Alistair ‘eyebrows’ Darling, will announce that savings of billions made by closing down existing government offices will contribute to the funding purse, along with the creation of some 250,000 new jobs over the next 10 years as a result of the speedy web access.

But how do the main political parties in England view the Digital Britain road map, and how their plans to deliver that digital economy vary? Thinkbroadband has been analysing the different approaches and come up with the following:

Labour

A ‘Universal Service Commitment’ of 2Mbps by 2012 to virtually everyone in UK funded by surplus money from the Digital Switchover fund.

Next Generation Broadband available to 90 percent of UK by 2017 funded by 50p +VAT per month levy on fixed phone lines which is expected to raise £1bn over seven years. This will fund next gen broadband to the final third where the market is unlikely to deliver a service without some intervention.

In his speech, Gordon Brown said that proposals for online delivery of government services “depend on reaching 100 per cent” coverage of next generation broadband and that by 2020 he expects “to make Britain the leading superfast broadband digital power creating 100 per cent access to every home”.

Conservative

Supports the 2 Mbps universal access by 2012 funded by surplus from that Digital Switchover fund.

Next Generation Broadband of 100Mbps to majority of homes by 2017 funded possibly by using a proportion of BBC license fee at any point beyond 2012. Funds would be used as loans or on a matched funding basis.

Thinks that BT should open up access to underground ducts and overground telegraph poles so competitors can lay their own fibre like they do in France and Singapore for example.

Wants a change to the rating system for fibre networks to remove all current disadvantages suffered by new operators.

Believes intervention may be necessary in due course for next-generation broadband, but market should be given a chance first.

Liberal Democrats

Supportive of government USC plans for 2Mbps by 2012 funded by digital switch over surplus, essential to have a minimum standard of service but 2Mbps is an unambitious target.

Thinks universal service funding should be combined with a project for rollout of next generation broadband, so those who can’t get broadband would get next generation broadband sooner.

Thinks that mobile broadband could have a role to play in hard-to-reach areas. Effective use of spectrum is important.

Would like to see vast majority of the country being able to access 40Mbps+ by 2017.

Wants immediate intervention to target areas unlikely to be reached by next generation broadband by the market, the final third. Would adopt an outside in approach (start funding the most rural of areas first) but admits “it won’t be possible for absolutely everyone to receive next generation access” immediately.

Opposes the Conservative policy to top-slice the BBC license fee.

Supports 50p/month levy “if applied properly and with exemptions for the least well off”

Welcomes BT decision to open up ducts.

Sees a need to encourage more services that make use of high speed broadband, including national and local government services, to drive demand.

Thinkbroadband, however, believes therefore that the key question will be what percentage of homes and businesses will have access to 100Mbps by 2017? The challenging target will be in the 80-100 per cent range. “The main political parties all accept the importance of securing a strong digital future with super-fast broadband, but each has made vague promises, leaving out some crucial factors that would allow us to hold them to account if they form part of the next government” says Sebastien Lahtinen, co-founder of Thinkbroadband, concluding “we see some differences in the plans for how next generation broadband will be funded, in particular the level and timing of government intervention, but we don’t have clarity from any party on both the question of what ‘next generation’ broadband means in terms of speeds, and how universal will access to this high speed broadband be? In other words, will they guarantee that every single household will get it?”

So Alistair Darling, the chancellor with the funny eyebrows who looks a lot like Parker from Thunderbirds, has dropped the strongest of hints that he might cancel the NHS IT system this coming week. Speaking on the BBC One Andrew Marr show, Darling admitted that the Electronic Patient Record Scheme has been “quite expensive” so far. Quite expensive? Look, I know this is the chap who thinks nothing of doling out taxpayer money to bankers like it was going out of fashion, but to call a scheme that has so far cost an estimated £12 billion “quite expensive” is missing the point by a country mile even for the Chancellor.

And talking of missing the point, while I have not exactly been holding back in my own criticisms of the proposed system (mainly on security and privacy fronts) over the years, to scrap it this far down the road and with so much public money already spent would be something of a false economy surely?

Yet many are taking the comments that Darling made on the Andrew Marr show to say just that, and point to Wednesday’s pre-Budget report as the most likely time such an announcement would be made. Comments such as calling it something “I do not think we need to go ahead with just now” do rather suggest they could be right.

Of course, Darling is not alone in reaching this conclusion as both leaders of the Conservative and Liberal Democrat parties have been saying the same for some time, and more loudly with a General Election looming at the tail end of a recession. While I am in no doubt that it has been a terrible money drain, following an all too familiar pattern of public sector IT procurement going wring and wasting money without delivery much to show for it, that does not mean it should be stopped now.

What it means is that it should be done properly, that the procurement and delivery process be revised and revamped and the people who have failed so dismally made to face the music. But just to say ‘oh dear, we screwed that one up didn’t we’ and wave goodbye to £12 billion worth of work is sheer folly.

I’d be interested to hear what those health professionals who read IT Pro think: should it be scrapped or simply done properly and with tighter cost controls? If your answer is scrapped, then what if anything do you propose should take its place?

Usually the kind of crystal ball rubbing industry predictions that start arriving at this time of year are fairly upbeat affairs. Not so when it comes to the batch announced at the telecoms and media Industry Outlook event in London which, to be honest, were pretty depressing on the whole.

Heck, you know it’s not going to be a fun ride when the press release includes in the strap line “2010: a year of slow recovery” and mentions “cost control” in the same breath.

The organisers of the annual Industry Outlook event, Informa Telecom & Media, and specifically the Chief Research Officer Mark Newman who, speaking at the event, insisted that it had “selected the most compelling and critical predictions from across all our research areas”. Mark if these are the most compelling then I recommend anyone working in these sectors put up the barricades, make sure they have enough tins of baked beans to last a year, and take 2010 off.

If you are feeling just a little too happy for a freezing cold, grey and dismally wet Sunday lunchtime, read on and prepare to be brought back down to a suitably depressing level.

Let’s start with: Mobile LTE commercial launches will slip to 2013/2014 but LTE’s role as a provider of rural broadband connectivity will gain momentum. Apparently, 2010 will be a “year of further LTE trials” but “progress towards commercial services is likely to be slow”.

Or how about: Operator app stores will struggle to compete with handset-manufacturer initiatives. Informa predicts that operators will be “unable in most cases to compete with Apple and other vendors in global reach, brand coolness and agility”.

This one is a bundle of joy as well: Mobile operators will make small steps towards a de facto functional separation in order to position themselves to address the demand for 3rd party connected devices and applications. The use of the words ’small steps’ in a prediction is always a giveaway that things are not good, as they are often used in place of phrases such as ‘going down the pan’ or ‘missing the boat’ in my experience. Informa says that unless operators “give full autonomy to wholesale units, we believe they will be too slow to succeed in shifting internal mindsets”.

I also liked: Fixed broadband operators will experiment with new business models in a bid to end the “arms race” of increasing speeds and declining prices. As Informa notes, operators have to address the need to grow revenues in saturated markets, pointing out that a major effect of declining prices and increasing bandwidth has been “the emergence of mass markets for the consumption of on-line video and music, which other players are now better placed to profit from”.

There was some good news in the predictions though, such as the continued importance of widgets in harnessing the power of the mobile web, open Internet apps being embraced by IPTV operators and an extension of coverage and reduction of costs through network sharing and outsourcing being on the cards.

Now, if you’ll excuse me, I’ll go and cheer myself up by reading some Kafka while listening to Radiohead…

Recession, what recession? That seems to be the message that Internet shoppers are giving loud and clear. Online spending is growing by £2.4 billion this year, with e-Retail spending set to hit £20.9 billion by the end of the year. That’s a growth rate of some 13.3 percent over the previous year.

A new report from Verdict Research admits that Internet sales are actually starting to slow and become more competitive as a market, online retail is still set to hit £31.2 billion by 2013 which would be a 10 percent slice of the total retail spend.

Verdict says that through 2009 the overall total retail growth will contract by 0.6 percent courtesy of consumer spending being ravaged by the recession. During the same period the online market will continue to expand, driven by a continued increase in Internet shoppers with a higher expenditure per head. This follows on from the trend of 2008 when there was a 1 percent increase in Internet users and an 18.1 percent increase in online shoppers, both spending an average of 5.8 percent more than in 2007.

It should be noted, however, that while online growth in 2008 represented a substantial out performance of wider retail it was not all good news historically speaking: this was the smallest rise in the channel’s sales since bursting of the dotcom bubble back in 2002. Verdict reckons the growth rates will continue to fall over five years as penetration of the population begins to level out.

“The key for individual retailers is to formulate two clear strategies, one for succeeding through the recession and one targeting growth beyond this, as the online channel begins to approach maturity,” says Malcolm Pinkerton, Senior Retail Analyst at Verdict Research and author of the report. “Those with less money to spend are turning to the internet to search out bargains on branded items like electricals,”says Pinkerton. “Additionally, the more affluent groups, who do still have money to spend, continue to appreciate the internet for its convenience, making the channel doubly resilient to the downturn.”

That said, there is some evidence that those with the least money are turning to cheap and chavvy high street alternatives such as Primark, Matalan, Poundland for their clothing and lower priced household items. “But overall this is being more than outweighed by increases in bargain hunters looking for larger, branded items and the loyalty of those most financially comfortable consumers who continue to value convenience over price” Pinkerton concludes.

In the grip of a recession, businesses are being forced to cut costs. No surprises there then. The results of a new survey have landed in my mailbox, and they reveal that when it comes to the IT sector the first area where those costs get cut is in the hardware spend. Again, hardly surprising as for most of us, most of the time, hardware upgrades can be filed under desirable rather essential. This particular survey targeted SMEs and asked what areas they would cut and in what order, if the recession forced their hand. Hardware was top of the list on 62 percent, followed by 35 percent who said they would cut their investment in IT support and then software licensing on 28 percent. Because the Internet is “a crucial tool in helping them through the recession” only 8 percent considered cutting back on their Internet access compared to 9 percent who were prepared to reduce their back-up and redundancy services.

So, the Internet will not be a victim of the recession then. No surprise there either. However, the least surprising fact comes when it is revealed that the company who undertook this survey was a business Internet Service Provider.

Chris Stening, Easynet Connect managing director, reckons that the findings “reflect the broader trend of IT moving from a software/hardware-based model to increasingly being delivered as a service. As a result, businesses are placing less value on their physical IT assets, and more value on IT services such as the internet and SaaS.”

Davey Winder, cynical journalist, adds “what next, an email provider reporting that the recession will not impact upon communication, or Apple reassuring us that people still want to listen to music when times get tough?” It’s Easter, must be a slow news week…

IT is certainly not immune from the economic downturn, that has become obvious over the last few months. Now it looks like the seemingly bullet-proof mobile market could be set to suffer big time with a $13 billion cut in growth over the next five years.

That’s the conclusion of a report from Juniper Research which warns that the recession will hit the mobile entertainment industry hard. Unless key markets emerge from recession, the report predicts that growth in user spend on mobile entertainment services such as subscription-based content, games and music downloads will slow dramatically over the next two years. Juniper Research also argue that slower deployment of content services will mean revenues are likely to be lower than previously forecast, and that even after those markets emerge from the effects of the economic downturn.

Given a worst case scenario of a prolonged global recession, the report warns that mobile entertainment revenues will increase by nearly $13 billion over the next five years. Sounds good, until you learn that before the downturn hit the figures were showing growth of $26 billion.

Report author Dr Windsor Holden says “While operators have made significant strides in reducing the costs of bundled data, the overwhelming majority of mobile users are prepaid customers who want to sample mobile Internet usage before committing to a bundle. And in most cases, data costs are so high that they act as a disincentive to such initial usage.”

Happy New Year, not! So far this month there have been reports of potentially thousands of jobs to go at Microsoft and as many as 20,000 jobs to go at Dell, IBM and Lenovo. These on top of reports from the end of last year which talked about 17,500 jobs being slashed at BT, Sun and Yahoo!

You might excuse me, therefore, for not being particularly upbeat about things when it comes to the economic crisis and the IT business.

However, IT and security professionals are a lot more optimistic, it would seem, when it comes to predictions about their own budgets during the course of this year. At least if what they have been telling Finjan as part of an IT security survey is to be believed.

Finjan conducted the survey amongst some 200 IT and security pros, focusing upon determining trends for allocating IT budgets this year compared with last. Unsurprisingly, it discovered that when it comes to the total IT budgets for 2009 these are reduced compared to 2008. Surprisingly, and thankfully it has to be said, the same is not the case when it comes to that part of the budget dedicated to security.

Here’s what the survey said about security budgets:

38 percent do not expect a change in their 2009 budgets
34 percent indicated that they expect them to be slightly smaller
34 percent expect their IT security budgets for 2009 to go up
43 percent expect their IT security budgets to remain the same

“During an economic downturn it is to be expected that all budgets come under scrutiny. Organizations are trying to get the most out of their spending and reduce the Total Cost of Ownership of their IT investments - efficiency being the name of the game.” said Yuval Ben-Itzhak, Chief Technology Officer at Finjan. “While 2008 saw IT security departments facing new challenges in protecting valuable business data against an ever-increasing wave of cybercrime attacks, 2009 is adding a further economic challenge to the mix. As a result, organizations are looking for a comprehensive security solution with low TCO that covers all their Web security needs and is also simple and easy to manage” he concluded.

It has to be either one of the greatest or most stupid press release strap-lines to hit my desktop in recent months, especially considering that we are slap bang in the middle of pretty much the worst financial crisis most of us care to remember.

Yet “Stop Press: The Recession Is Over” is what the press release says.

I guess it worked, in as far as it got my attention and, indeed, I am writing about it now. But what the heck does it mean, is there any substance to the claim beyond a clever bit of media puffery?

Well the man behind the release, CEO of management training outfit Mitchell Phoenix, Kevin Yates reckons that it all comes down to a game of chess. The argument being that the CEO today is in the middle of a game of chess and needs to be considering the endgame strategy now.

Sure, the strategy that had worked so well for the last decade has just been shot to pieces, but Yates says you can now either develop that new strategy to win (the clever money is on this one) or focus on survival and adapt your play turn by turn.

In other words, the savvy CEO should be planning on how to take advantage of the economic upturn right at the moment when most of us are slipping into the brown smelly stuff right up to our necks.

I mean, c’mon, who is really looking at the long term when the bank manager is knocking at the door and demanding that overdraft payment today?

Yates reckons “while one side concentrates on staying alive moment by moment, their opponent is executing a long-term strategy designed to win the match. Those whose aim is solely to get through the recession will get through it – but what will they find on the other side? Those with a longer-term vision will have seized the initiative.”

I guess he has a point, and it applies equally well to the IT business as it does, for example, the motor manufacturing trade. Car manufacturers are being hard hit right now, to the point where it looks increasingly likely that the government (or governments around the world, even) will step in and help shore them up short term. But Yates argues that the long-term strategic thinkers are the ones best equipped to not only survive but to build on that survival. Vauxhall are considering closing the factory for 9 months and keeping staff on 30 percent pay; Honda are closing for two months with staff on full pay.

“Both these manufacturers place staff retention above redundancy in their survival strategies.
In the past, factory closures would almost certainly have been accompanied by job losses. Then, as the market picked up manufacturers would be unable to return to full production immediately” Yates points out.

So he does have a decent point to make after all, and one that the tech business, the IT enterprise, the savvy CEO should be taking seriously.

Well, up until the point that he repeats “From the perspective of a CEO, this recession is over” and loses me again as I collapse on the floor in a heap of ROFLing jelly. Aided by the fact that I have just discovered how much the Taxman wants me to magic out of my hat by the end of January. Does sending the Inland Revenue a white rabbit count as long term strategic thinking?