Opinion: How broad is broadband?

COMMENT Broadband may be widely available in the UK - but how fast are these connections? Can they even be considered broadband? Simon Moores sheds light on how the UK compares to the rest of the world on internet speeds and policy.

Mrs Thatcher might have marked the announcement by telling us to "rejoice" but you can be certain that Mr Blair is at least "encouraged" by the government's claim to have partly met its target to make the UK the G7's most extensive and competitive broadband market by 2005.

Except that behind the smoke and mirrors that we've come to expect from any government announcements, there's a harsher reality which shows that broadband is a relative definition that can as easily describe two tin cans and a connecting piece of string as a 10Mbps connection to the internet.

While the UK is seen to be performing well against other G7 nations, particularly where availability is concerned, there is still some way to go before equalling Korea, Canada and Japan.

If we examine the evidence, a report from analyst group Ovum commissioned by the DTI, then the UK has achieved its target of becoming the most "extensive broadband market" during the third quarter of 2004, having leapt up into first position ahead of Japan and Canada.

The indicator is described as "a combination of metrics for the availability of affordable broadband services and the market context". However in terms of competitiveness, the UK remains in third place behind these countries and only achieved fifth place on take-up.

The reaction to the DTI survey from Eddie Cheng, ebusiness director at the Yell Group, was to ask: "What about bandwidth? Did they include 128Kbps as broadband - or did they draw the line at 500Kbps? The Japanese already have 10 million-plus households on 8Mbps."

In Asia, as Cheng points out, millions of people can choose between fibre to the home and ADSL with speeds of up to 20Mbps. In Hong Kong, 1GB broadband will be on offer later this year to residential customers and Japan has the widest range of bandwidth services, from 1.5Mbps to over 40Mbps, and is probably the cheapest DSL market in the world.

In 2003 independent regulator Oftel revised its definition of 'broadband' by dropping the requirement that internet connections should be capable of delivering real-time video content.

It concluded that asymmetric broadband internet access is in a separate market from narrowband internet access and as the government spokesman Lord Sainsbury expressed it: "This revised definition takes account of responses to earlier consultations and Oftel's own consumer research which shows that people do not see real-time video content delivery and 256Kbps as the defining feature of broadband. This is an economic definition for the purposes of the market review, which conforms to established principles of competition law methodology. It does not affect the range of services available to consumers at different bandwidths."

In other words, broadband is what you say it is, a loosely defined expression much favoured by politicians.

The UK can rightly claim credit for 'extensiveness' and 'availability' but with other European countries it shares many of the challenges of opening up an infrastructure once dominated by a single incumbent telecoms provider.

More recently, we've been treated to the 512Kbps definition of broadband and today I now have a 1Mbps connection from home at an incremental price. That's a huge leap forward compared to three years ago but in terms of economic competitiveness places us in the shadow of a rapidly growing Chinese economy that will, in a relatively short period of time, move the internet's centre of gravity towards Shanghai from its current position in the mid-Atlantic.

Why is government, which is committed to the inclusive nature of the internet, failing to take account of speed as a vital contributory factor in the economic development of our country? True broadband speeds can be shown to drive content and commerce and raise the bar economically on the way in which a society can leverage the internet.

Today, with the Chancellor in China, what we appear to be lacking is time and imagination as the world's economic centre of gravity slides away from us.

When I met BT's chief executive Ben Verwaayen in December, he praised the UK as Europe's strongest economy but he warned: "There's no point in turning around to your politicians in five years' time and asking where the employment has gone. We think we have a system that gets the best out of people and makes them productive. Think again. We all have a computer but your computer is worthless unless you use it as an instrument to compete and you need advanced networks to compete."

Achieving a 'B' grade in contrast with other G7 nations and having half the population or more connected to internet should be a means to an end and not an end in itself. The next target we should be setting ourselves as a nation should not be a race with Italy, France or Germany but with Japan, Korea and China, where the economic future of the 21st century lies.