License fee could fund super-fast broadband

 

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Posted on 21 May 2010 at 11:10

Yesterday the new coalition government gave its first indication of strategy concerning the roll out of superfast broadband in the UK, and the better provsion of broadband to rural areas.

The statement promised the roll out of super-fast (optical) broadband, with parity between urban and rural services. It claims that providers (such as BT and Virgin) will be made to balance their provision geographically. It goes as far as suggesting that BBC licence fee could be used to achieve this.

We're keen on the idea of superfast broadband, and provision of such to rural areas. But we're not convinced, given the current financial circumstances, that matching urban and rural rollout will be financially viable. Diverting money away from the BBC is an interesting option, but a controversial one that breaks the direct link between the licence fee and the BBC.

Michael Philips, the director of Broadbandchoices commented: “Using funding from the TV Licence fee to meet the needs for rural broadband is much more preferable to the blanket 50p-a-month tax on telephone lines put forward by the last government.

“However it does seem likely that the licence money will only be used as a top-up in rural areas where broadband providers fail to see the commercial benefit of expanding their networks. Furthermore, people who may not necessarily be interested in using broadband will still end up funding this initiative through their TV licence fees."

The government's announcement in full, said: "We will introduce measures to ensure the rapid roll-out of superfast broadband access across the country. We will ensure that BT and other infrastructure providers allow the use of their assets to introduce superfast broadband in remote areas at the same time as in more populated areas. If necessary, we will consider using part of the TV licence fee that is supporting digital switchover to fund broadband in areas that the market alone will not reach."

Author: Seth Barton