10 Jul 2018

Malcolm Dowden, Legal Director, comments on one of the priority areas identified in the National Infrastructure Assessment report - building a digital society: 

"Government proposals to extend broadband connections to all homes and businesses face a central economic challenge. Initial roll-out targets for electronic communications providers were set by reference to population percentages rather than geographic coverage. Predictably, investment focused on more densely populated areas. Costs per connection inevitably increase in more remote or sparsely populated areas. Various plans have been launched over the past decade - most recently the proposed universal service obligation (USO) under Digital Economy Act 2017. The USO would establish a legal right for businesses and consumers to request connection subject to payment of up to £3,400.

"Given that the NIA focuses on fibre connection, it is likely that the National Broadband Plan would lean heavily on the USO. However, other issues need to be factored in. The electronic communications code (which allows the court to impose on reluctant landowners an agreement to site equipment on their land) was replaced on 28 December 2017 by a new version, following Law Commission recommendations. However, wariness on the part of both operators and landowners has seen a reduction rather than an increase in site agreements so far this year. Doubts concerning the operation of the new code (for example the precise extent of the operators’ right to upgrade equipment without payment) and the valuation methods it imposes are likely to be resolved only through litigation. While key issues remain unresolved, the new code might inhibit rather than promote improved coverage.

"An alternative route, deployed in countries such as Singapore and the UAE, might be to require developers to design connectivity into new buildings and schemes. However, the effectiveness of such schemes depends on the pace and scale of development, and may do little to extend rural coverage.

"While a focus on homes and businesses is both inevitable and understandable, it does not necessarily address other connectivity problems - for example poor signal strength and “not spots” along transport routes, or the demand for bandwidth and backhaul for an increasingly important array of “internet of things” devices such as connected manufacturing processes or (looking to Brexit) the tracking of goods on import or export for customs, tax and regulatory purposes. 

"The NIA recognises that connectivity is now a key utility for business and home life. It provides a valuable focus for government action on improved connection. However, it is part of a long-standing debate that can be rendered into a key question: who pays when the cost of rural connection so significantly outstrips easier urban connections?"