Note of Meeting – 2 November 2010

Note of Special Meeting of Cross Party Group in the Scottish Parliament on Digital Participation

November 2, 2010

Macdonald Holyrood Hotel, Edinburgh

Willie Coffey MSP introduced Ed Richards, Chief Executive of Ofcom. As the communications regulator, Ofcom’s activities had a major impact and influence on the concerns of the CPG, from the availability of broadband, mobile phone coverage, and next generation (or faster speed) broadband. Ofcom’s activities in spectrum (or what’s more commonly known as the airwaves, which underpin a lot of communications devices) was also critical to newer services like mobile broadband, which may be particularly important in providing services in more rural communities. WC also referred to Ofcom’s record of engagement in Scotland.

Ed Richards gave an overview of the key Ofcom issues relevant to the CPG, covering broadband availability, take-up and use. The UK as a whole, including Scotland, was not in a bad position. In Scotland fixed broadband coverage stood at 99.86% and there was the Avanti broadband reach project over and above this. The UK Government had made a 2Mb commitment by 2015. The big issues revolved around superfast and mobile broadband.

On superfast, Virgin and BT had been making worthwhile first steps. Ofcom was looking at the regulatory framework centred on Virtual Unbundled Local Access (VULA) in recognition of the need for a range of competitors. BT superfast prices were not regulated in recognition of the commercial risk factor in investing in this area. Another key change was in the area of Physical Infrastructure Access (PIA). Community groups could benefit from this as early as January 2011. However Ofcom recognised that regulatory measures like these would not achieve everything that was desirable.

Much would be learnt from the BDUK pilots, including one in the Highlands and Islands, about the cost of deployment which would feed into the broader conversation about the digital divide.

On mobile, Ofcom would shortly be publishing research on not spots and ER predicted an almost insatiable demand for mobile broadband. The key issue was the release of spectrum and the way was now clear for the release of the 800MHz band.

As far as take-up was concerned, there was the Race Online initiative and the newly published Scottish Government digital strategy. Ofcom was not directly involved in digital participation but could contribute in terms of our understanding of the reasons why people do not go online. These included cost factors but also one of level of interest: some people were not yet persuaded of the benefits.

ER concluded by referring to the future opportunities for businesses and households resulting from superfast broadband.

Q&A

Domnhall Dodds (United Kingdom Competitive Telecoms Association) referred to the PIA remedy being too restrictive for some operators and receiving a lukewarm reception from the EU. ER responded by saying that duct and pole access was as fundamental as you could get. The EU was not lukewarm but wanted to see every EU nation with unbundled fibre. Everyone would like to see this happen but realistically it was not possible in some countries; there were funding issues with delivering fibre to all homes.

Peter Peacock (MSP) asked about regulatory issues for other (non-BT) providers, referring to the Pathfinder initiative, and whether community broadband organisations would have to address regulatory matters. ER said the principal rules applied to BT. There could be issues relating to alternative providers but Ofcom would need to see the details first. Sometimes regulatory issues arose from contractual agreements and it was hard for Ofcom to override these. He hoped regulatory considerations for communities did become a big issue as this would be evidence of activity. He recommended community groups should contact Ofcom for guidance. Sometimes groups signed contracts with big suppliers; Ofcom would prefer to see open access community deals.

Michael Fourman (University of Edinburgh) described the lack of fibre as an obstacle to fixed and mobile broadband roll-out. Simply opening up ducts could lead to duplication of effort. If dark fibre was opened up people could connect and fill in the last kilometres. ER said PIA was not designed to be the full solution to the final third issue. It was designed to contribute to this and to increase the level of effective infrastructure competition. The deficit of fibre backhaul was in the sights of the BDUK pilots. If communities got funds they would still have to deal with backhaul issues and the pilots would contribute to the understanding of this. It was possible PIA would be relevant as non-BT providers could take regulated products from BT or use alternative networks.

MF said unless there was sufficient access from BT communities would have to organise all their backhaul. MF argued in favour of a dark fibre remedy. ER questioned whether there was a lot of dark fibre available though there could be commercial deals to light the fibre that was available.

Mike Kidd (Creative Industries Consultant) wondered if Ofcom’s current approach to spectrum was appropriate in the current environment – would Ofcom consider introducing a “use it or lose it” restriction to the spectrum auctions. ER said it was possible Ofcom could look at this again.

Maggie Ellis said that some of her current research was similar to that of 20 years ago in that it showed developers rarely meet a real user. She said the qwerty keyboard was a foreign language to many of her people in Achiltibuie – could it not just be a simple ABC. She said that similarly developers did not talk to the sellers, so that millions was spent on research with little impact. ER said there are often challenges, such as digital switchover, but such problems were usually dealt with. He said that with developments such as the iPad he was optimistic about the future.

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