Thursday, June 18, 2009

The Digital Britain report | Critics slam Digital Britain over file-sharers and tax plans

A "colossal disappointment", say Tories

By David Meyer Published: 18 June 200 09:15 BST

The Digital Britain report has drawn criticism from politicians and technology experts over its proposals for dealing with fibre rollouts and illegal file-sharing.

The report, published on Tuesday, outlines the government's plans for the UK's telecommunications infrastructure and digital economy. Shortly after its publication, Jeremy Hunt, the Conservative Party's shadow secretary of state for culture, media and sport, called Digital Britain a "colossal disappointment" and lambasted the plan's proposal for a monthly 50p tax on fixed copper lines.

Lord Carter, the report's author, proposed the levy as a way of funding the rollout of fibre-based next-generation broadband to areas of the country where operators might not see a business case for investment. Speaking in Parliament, Hunt said a better tactic would be to stimulate investment by changing regulations to encourage providers to spend on fibre development.

"The cable revolution happened without a cable tax. The satellite revolution happened without a satellite tax," Hunt told Parliament on Wednesday. "Everyone recognises that public investment may be necessary to reach more remote parts of the country but simply slapping on an extra tax is an old economy solution to a new economy problem."

Hunt also pointed out that Digital Britain announced 12 new consultations, and called the report "government of the management consultants, for the management consultants, by the management consultants".

The tax will benefit the biggest existing providers in the UK, according to Chris Smedley, chief executive of fibre-optic network company Geo.

"The tax will only raise around £170m per year from consumers, and [this will] be presumably handed straight back to BT and Virgin Media - who will still have the UK market in a stranglehold - and then only [used] to deliver fibre to the cabinet," Smedley said in a statement.

"Just as importantly, the government will still levy rates on fibre once it's in use, perpetuating the problem of cable lying dormant in the ground. Removing these [rates] would have been a quick and easy way to promote a fibre future for the UK."

Smedley also attacked the 2Mbps base speed for universal broadband coverage proposed by Carter, saying it leaves the UK open to ridicule. "The UK is the world's sixth-largest economy, yet this report says it cannot justify similar investments to those already promised in the US, Australia, Singapore, Korea and Japan, which are aiming to deliver 100Mbps as standard," he said.


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