Peter Cochrane's Blog: Government gaffe

Written at and dispatched to silicon.com from the Institute of Directors' Pall Mall office via a private wi-fi site, within an hour of arriving by train in London

I'm not generally moved to make political comment or even extend my thinking to the world occupied by our government leaders and the politically motivated.

Broadband from A to Z

Click on the links below to find out more...

A is for ADSL
B is for BT
C is for Cable & Wireless
D is for Dial-up
E is for Education
F is for Fibre
G is for Goonhilly
H is for HSDPA
I is for In-flight
J is for Janet
K is for Kingston
L is for Landlines
M is for Murdoch
N is for Next generation
O is for Ofcom
P is for Power lines
Q is for Quad-play
R is for Remote working
S is for Satellite phones
T is for Trains
U is for Unbundling
V is for VoIP
W is for WiMax
X is for Xbox
Y is for YouTube
Z is for Zombies

However, on my journey into London this morning I caught sight of a newspaper headline stating that our government was to give every child in the land the princely sum of £700 so they can all get online. That got me thinking!

How out of touch with the real world are our politicians? Why would they want to do something like this, other than buying votes? Everyone is online already, and if they are not it is because they choose not to be so.

The price of broadband and PCs is now so low that access is far below the cost of hi-fis, TVs, satellite and cable. With ISP prices as low as £3.25 per month from one provider, and a lot coming in below £5 per month, and some PCs and laptops now costing less than £200, getting online is no longer expensive or a big deal.

So what is this headline £700 for? Will every child in the land get £700, or will it be just those who are not online already? Is it a one-off payment, or is it an annual handout? Is it a per-child or per-household payment? No one seems to know! And what will it cost the good old, hard working tax-payer?

There are about 15 million children under the age of 20 in the UK today. At £700 per head this programme would cost around £10.5bn. If the payment were per household, with an approximate average of two children per home, the cost would be £5.25bn. And if this is to be a handout for those without broadband access at all, then it rapidly becomes petty cash and another meaningless political gesture.

The really interesting feature about all this is that the politicians are really missing the point. What is called broadband today plainly isn't. And getting fibre to the home and office is a real national requirement on every level from future health and education through to GDP generation and future standing in world markets.

So how much would it cost to get 'real broadband' deployed using optical fibre? The latest internal industry estimates are around £9bn to £10bn, as 85 per cent of the UK population already live within 1km of an installed fibre route.

Providing fibre all the way to the home (augmented by wi-fi/WiMax in difficult locations) would bring unbounded benefits. What's more, they would come at a trivial cost compared to 3G and many other technologies which have been recently deployed.

But unlike many other countries, while the UK government can't find any money to trigger a national fibre rollout, it can find £5bn to £10bn to throw at a hugely important non-problem!