By Natasha Lomas, 16 June 2009 18:04
NEWS
The government has announced plans for a 50p per month levy on all fixed copper lines to fund the expansion of fibre broadband to areas where the market fears to tread.
The proposals come as part of the government's Digital Britain report - its blueprint for ensuring the UK does not become the laggard of the global digital economy.
Speaking at the launch of the final Digital Britain report in London today, Communications Minister Lord Carter said it is very likely the market will deliver next-generation broadband for between 50 and 65 per cent of the population of its own accord.
The "final third", however, is likely to be ignored by the market without additional help from the public sector - and a copper tax is Carter's answer.
"We recommend a very simple price of 50p per fixed copper line levy on everyone which we will use as a means of subsidising market build out of fibre networks to the remainder of the population," said Carter.
Carter estimates the levy will raise between £150m and £175m - a sum he said will provide "enough investment" to make the economics of taking fibre to the last third of the population "attractive".
Pointing out that it amounts to £6 per year for every household, he said: "We have not made that decision lightly but [the levy] is a forensic way of answering the [next-generation broadband] question."
"The benefits to the economy will be enormous," he added.
Key among these benefits envisaged by Digital Britain is the ability to shift public service delivery onto a digital footing. By 2012 the report anticipates there will be "a significant increase in digital participation" triggering public services to be switched to primarily electronic and online delivery.
Back in January the interim Digital Britain report included a plan for a universal service obligation for up to 2Mbps broadband, with the aim of ensuring there are no more digital 'notspots'.
The final report concretes this proposal.
"We are not saying that [up to] 2Mbps is the height of our ambition," said Carter but rather a "technological minimum wage".
"It's the level of connectivity that's required for people to access the sort of services that we want," he added.
A combination of government investment, commercial tender and extension or change to existing mobile licences will be used to deliver universal service, according to Carter, who said that many of the homes currently without broadband will be connected using technology with "next-generation capability".
"We are not specifying a ceiling, we are specifying a floor," he noted.
To enable the UK's mobile networks to play a bigger part in building universal broadband, Carter flagged up the report's plans for "a programme of spectrum liberalisation, auction packaging, auction release timetable, licence change, licence liberalisation", adding: "All of which we believe will do in mobile networks what we're saying we will achieve in fixed networks."
The report names dot-com entrepreneur Martha Lane Fox as a Digital Inclusion Champion to evangelise the skills and benefits of digital participation with the aim of encouraging broadband refuseniks - those who can technically get broadband but choose not to - to take up fat pipes.
It also sets out Carter's final thoughts on safeguarding intellectual copyright in an age of illegal file-sharing - with telecoms regulator Ofcom set to be given "an explicit duty" of significantly reducing piracy. In addition, it recommends ISPs should be armed with "a suite of technical measures" to combat repeat P2P offenders - such as bandwidth throttling.
Comments
There are 18 comments. Join the discussion
1. karen challinor
here's an idea
instead of hitting everyone with a telephone line with a new tax which will make quite a few switch to mobile solutions
scrap the NIR/ID card and use the £5Bn the government says it will cost to fund fibre to every home completely bypassing providers like BT and Virgin
2. Guy Reynolds
So lets get this straight, we are going to have to pay a tax for an unspecified period (probably for ever), which is going to be used to fund the installation of fibre networks which operators are then going to charge us for and make a profit out of.
No thank you,
Just one more reason for getting rid of my telephone landline, the only calls on which are from people who are trying to sell me stuff in defiance of my TPS registration.
3. anonymous
£6 tax to provide broadband to the sticks.
Pretty poor IMHO, principle of the thing. Should be subsidised out of general taxation. or relax the competition rules in these specific cases requiring BT to do the work, and get a return on their investment - they are hardly going to do a £100K exhange upgrade for 500 people, if half of them sign up to competetor broadband are they.
Maybe in compensation, there should be a Haggis tax, Celtic (Football) Tax, BBC Wales tax, Irn Bru tax, Shortbread tax, Clean air tax etc to ensure 100% penetration of these vital services/products to the rest of the country where they are sadly absent ?
Are the government really that skint.
I bet BT, Virgin, O2 etc will love this, having to amend their billing systems to collect for HMRC.
Madness.
4. anonymous
The first comment would be that we have 2 land lines, would we have to pay twice ?
Also it is notable that BT currently charge you £4.50 for the previlege of paying your bill on-line.
It seems that they now want to charge us for the infratsructure that you may not use.
If we are forced to pay, we sould be given shares in the infrastructure that we are paying for.
5. Chris Tolmie - Nortel
It may not be the best solution, on the other hand we should not put the burdon on BT to build out a network without a reasonable return. Let's get fibre rolled out. Happy to be a lead customer (please!!)
6. Nigel Hawthorn, EMEA Marketing VP, Blue Coat Systems
The measures to tackle file sharing go some way to addressing the problem, however placing greater onus on ISPs raises issues in terms of the practicalities of enforcement.
Importantly, businesses still need to be aware that illegal file sharing isn’t just a consumer issue and that they’re responsible for data and traffic on their networks. Ultimately management must ensure that they are taking the steps needed to ensure that employees aren’t breaking copyright using the organisation’s PCs and networks, as the organisation could ultimately be liable.
Businesses need to gain greater control and ownership of what’s happening across their own networks not only to mitigate the security risks to their corporate network but also to identify the applications that are clogging the company pipes.
They should then use the available tools and technologies to prioritise the business critical traffic - ever more important as the boundaries between the home and work are blurring
7. GALLEYSLAVE
Again that dirty word 'TAX' rears its ugly head, 50p a head!!! well we all know that taxes always increase and never stay at the introduction level and are also rarely recinded.
The owners of this mass of copper wire have been robbing us blind for years. let them, put some real BRASS on the table.
8. Andy Donaldson
Nigel,
When you say:
"They should then use the available tools and technologies to prioritise the business critical traffic..."
I assume you mean tools and technologies available from Blue Coat Systems :-)
Never miss a Sales/Margeting opportunity!
9. Matt H
Well seeing as I don't have a BT copper line into our house, I'm refusing to pay! When we first moved in we found that we only had C&W Fibre running into the house, BT have never had a line in and that it would cost me in excess of £170 for the priveledge! Well up yours Carter! I ain't paying a penny towards your poxy UK 2Mb connection, I'll stick with my Virgin Fibre connection thank you very much!
God this country really takes the wet! Why don't they use the money the Politicians have robbed us all of in their expenses claims?! Maybe that would go some way in restoring our faith?
10. karen challinor
and what about pensioners who neither have a PC nor an internet connection but use a phone because it's their only lifeline ?
what about my sister who does not have or want a computer, but has a phone ?
...she's not a pensioner I should make that clear, not that she'll ever see this
what about all the other people who have phone lines but will in no way benefit from a guaranteed 2Mb/s internet connection ?
why should they pay to subsidise the rest of us ?
I still stand by my "claw the money back from ID cards" idea, it'll still be a drop in the ocean compared to what is required but it would be a bigger drop than we'd get from this tax and we'd get something we want while getting rid of something we don't need
if the state wants an information superhighway it's going to have to get off it's a*se and install one itself as ISP's have no incentive to upgrade their systems they are charging as much as they can get away with for as little as they can get away with already
11. Lionel A Smith
Now consider all the bricked up windows in older buildings. Why were they bricked up?
To avoid paying a window tax which was some government's 'brilliant' idea at raising funds.
This is sure to make many folk get rid of their lines as fast as possible.
The law of unintended consequences will strike again.
Oh! And BTW I am on cable broadband along with the 'phone. Should I expect to be taxed?
The devil, as always, is in the detail but politicians have a nasty habit of not understanding those.
12. Bert Smudgens
Right Gordon, rip off the taxpayer yet again in your usual sneaky manner. Then no doubt snoop & sneak on every person & PC using the service. Hang on though, when did the govt ever manage to implement a technical system effectively?
I can feel a line cancellation letter appearing on the horizon - I'm sick of paying for Gordon's mistakes.
13. GuyReynolds
I just wonder how much those proposing the phone line tax understand about phone technology and how the propose to implement it.
My employer used to have 16 discrete lines coming into the company, so I assume that would have been 16*£6. We have switched to an ISDN30 over which we run 30 channels, so are we going to be paying 1*£6 because we have one set of wires or 30*£6 because we have in effect 30 line?
14. Ciaran O
Digital Britain report says it is expecting to generate £150m - £175m PER YEAR from the 50p per line levy (page 65 of the report). So from 2010 will be considerably more than the £175m by 2017 fund suggested in the article above.
15. drew stephenson
I'm still waiting for someone to explain to me (or indeed anyone) how an ISP or any other agency is going to determine if the content of a shared file is in breach of copyright law.
All the measures proposed and discussed are at the behest of industry lobbyists and work on the presumption of guilt.
16. Kay
so what do I get out of it, you want me to pay for, let me see a copper line that i don't use as I am on cable, and if I was using a copper line I would have to pay £6 but getting nothing for my money, I say get the money from the MPs as they have robbered us blind for years I'm sure there would be plenty to pay for this
17. anonymous
Note to the Virgin customers, if you get your phone up your cable, this is classified as a 'phone line', so no you are not exempt.
Wonder if BT will ever consider the sometimes talked about broadband *without* a phone service. It does actually work quite well, as once a BT engineer left me with broadband services but no dial tone after chasing noise on the line down. What with mobile phones and VOIP, analogue voice service almost not really needed any more.....
Hmm... without the nasty voice to contend with, broadband might go even quicker ?
18. anonymous
The Government seems to have conveniently forgotten we already have a tax for this. The Broadband Fibre Tax levied on all fibre deployments (per metre of lit fibre, per year) hits service providers and customers hard, except for BT and C&W. This tax has been in place for a number of years and was to be used for this purpose. A second tax makes a mockery of Labour's plan to achieve anything like a digital economy. A digital backwater is more like it.