I believe that – far from signalling the beginning of the end for the government’s “super-connected cities” initiative – legal wrangling such as the appeals from BT and Virgin Media for the European Commission to annul the decision to approve the UK’s first state-aid-backed network in Birmingham was always a likely outcome, and may in fact improve the scheme’s chances of success.
£114 million has been earmarked to be shared between ten of the UK’s largest business centres, for the building of city-wide “metro-networks” offering broadband speeds of up to 100Mbps to around 300,000 homes and business premises while also providing high-speed wireless connectivity. The appeals to Europe’s top competition watchdog centre on the detrimental impact the initiative could have on commercial investment in high-speed connectivity.
While lauding the government’s intent to make UK cities more competitive on the global digital stage, I am unsurprised that the scheme has hit a roadbloc. When the initiative was announced, it was always going to go one of two ways: either a big player would seek to monopolise the tenders, or they would challenge the validity of the government’s plans with competition authorities for fear of losing out on a lucrative revenue stream.
Far from breaking up the super-connected cities programme, this appeal invites a reassessment of the economic and technical infrastructures necessary to successfully provide superfast connectivity. Government funding is a drop in the ocean compared with what is required, and city authorities are in no position to provide sufficient additional finance.
A substantial infrastructure project like this must be executed well to retain public trust and valuable impetus: putting the responsibility for building, running, and maintaining these networks on councils, who lack the necessary technical expertise, is the wrong approach.
If the government is committed to making a success of this initiative, it should put the networks out to tender in a way that prevents a single provider dominating the superfast broadband landscape in the same way as the telephony market was once monopolised.
A change in focus will be needed if the UK is to lead the European move towards ultra-connectivity. Everyone keeps talking about the relative data transfer speeds of wires and fibres, ignoring the significance of the data centre.
Broadband network deployment is like improving the road network: you can widen motorways as much as you like to increase the volume and speed of traffic flow, but the net effect is zero if exits and sliproads are not redeveloped to manage these increases. Without substantial infrastructure investment, data centres will become choke points that nullify the benefits of superfast broadband.