Funds to help bridge UK digital divide

Local authorities in England and Scotland have been allocated £363m to help provide super-fast broadband as part of the government’s drive to bridge the UK’s digital divide between town and countryside.

The redistribution of a portion of the BBC licence fee will see Devon and Somerset, Cumbria, Norfolk and Lincolnshire receive the biggest boost to local broadband roll-out, while the West Midlands, Tees Valley and Greater Manchester will each receive less than £1m.

London will receive no public funds at all, on the assumption that the market will provide for the city, and the government is calling on the private sector to provide additional investment across the country.

“I don’t want to underestimate the challenge we now have of making sure we have equity so that remote rural areas as well as the West End of London get the investment from big companies like BT and also Fujitsu and Virgin [Media], and to make sure we get take-up,” said Jeremy Hunt, secretary of state for culture, media and sport, as he unveiled the details of the plan at Imperial College London’s business school.

English county councils will receive £294.8m and Scotland £68.8m as part of a £530m investment during this parliament, with £300m more to be made available by 2017.

Funds have already been allocated to Wales, Northern Ireland and some pilot areas such as South Yorkshire.

BT said it would “consider” bidding for the funds and urged the government to “work with private sector partners who are in this for the long run, who are willing to invest significant funds and who can guarantee open and equal access to their networks”, adding: “Local monopolies would benefit no one.”

The Countryside Alliance, a pressure group, welcomed the news but said the UK still lagged other European countries’ efforts to shrink the digital divide.

Mr Hunt hopes the scheme will address existing broadband “not-spots” and “not-a-lot spots”, as well as encourage investment in the “final third” of the country where commercial providers alone are unlikely to deliver super-fast broadband of more than 24 megabits per second.

He said he wanted to ensure that the government’s broadband policy, which includes wireless as well as fixed-line networks, was “not always solving yesterday’s problems”.

“We are talking about a 24-meg-plus connection, which is is faster than any application you would need that is currently on the market,” Mr Hunt told the Financial Times.

“The real point behind this programme is we recognise that it is a moving target. By 2015, people will be saying, ‘This is way too slow, what we need is 100 meg.’ We are trying to put in place a strategy that means we are going to be properly upgrading speeds available through the network.”

Most counties will be given between £1m and £10m, with funds based on estimated costs of delivering fibre-optic and wireless broadband networks. Devon and Somerset will receive the largest allocation at £31.3m, followed by Cumbria with £17.1m.

Local authorities will work with infrastructure providers to install new networks. Broadband services will then be sold to consumers by businesses such as BT, Virgin Media, or local providers.

BT has said that it could deliver super-fast broadband to 90 per cent of UK homes if it were given the lion’s share of the funding. But Mr Hunt said the government was developing framework contracts with a range of prominent suppliers to ensure a wide range of broadband providers.

“We are not going to determine the outcome of market-based competition, but obviously we are being absolutely clear that we are not showing favouritism to any one company and we are going to allow competing providers to offer what they can,” he said.