News

Read about the latest developments at Shepherd and Wedderburn - as well as updates on the law. There are also details of our latest deals, and our media centre for journalists.

Media Releases
2004

16 January
2004

Calls for decisions on UK broadband future

  • Existing infrastructure creates Capex burden for private sector
  • Proposed government intervention may breach competition law

The conflicting priorities of public and private sectors over broadband infrastructure must be addressed if the UK is to continue its current rate of uptake, according to one of the UK’s leading telecoms law specialists, Shepherd and Wedderburn.

Over 39% of the UK’s computer users now access the Net via broadband, with a reported increase in adoption of 300% between November 2002 and November 2003. With the majority of these gains having been made in southeast England, the focus is now on delivering broadband access to the rest of the UK.

In recent months, industry representatives, the Broadband Stakeholders Group has called on the government to fund an alternative infrastructure for broadband access in order to facilitate higher speed access and to extend the geographical reach of the service. This approach has not pleased large sections of the Telco sector that have already invested millions in the development of their own networks.

Paul Carlyle, a partner specialising in telecoms at law firm, Shepherd and Wedderburn, has offered advice to industry experts on both sides of the argument.

He said: “The UK government has set targets to make the UK the world leader in e-commerce by 2005, however, this expansion will be severely restricted without investment in the broadband infrastructure. Currently 36% of the British population has no broadband access at all, whether through ADSL, telephone lines or cable.

“It is clear that a solution must be found to improving access to broadband services for the wider public, however, opinion is split on how to achieve this. Enterprise agencies have proposed a publicly funded network, with service providers paying for access, however telco companies who have already invested heavily in their own infrastructure feel that this will put them at a disadvantage.

“The current market does not encourage telecoms firms to invest in the creation of new network infrastructure and that has resulted in a lack of competition in most parts of the country. Public sector intervention could lower the levels of capital expenditure required by private investors and open up the market to new suppliers.

“ While a government financed broadband expansion will benefit both consumers and potential service providers, existing suppliers will be left at a disadvantage, with huge amounts of capital invested in their own, aging infrastructure. Ultimately, the intervention of government agencies may breach European Competition law. "

To meet the government’s target of making the UK the world’s front-runner for e-commerce, both public and private investors will have to invest heavily in developing wireless broadband access. However, UK public sector projects are being held up by debate with the European Commission. Equivalent projects elsewhere in Europe are taking as more bullish approach.

Mr Carlyle continued, “The UK government has good targets and makes a lot of noise in this area yet other European states are getting on and doing it. Now must be the time for the UK government to support these public agencies seeking to implement the broadband vision – or decide to let the market do its own thing.

“The continued success of broadband and the future of e-commerce in the UK is dependent on a common cause - to provide broadband access to businesses and homes wherever they may be. The only way this can be achieved is if both public and private investors are pulling in the same direction.”

Shepherd and Wedderburn and partners, Europe Economics, host a Telecoms conference on January 27th at the Institute of Directors, Pall Mall, London. The conference, titled ‘State Delivered Broadband: whose line is it anyway’, is aimed at anyone within the industry with and interest in aggregation, access to broadband, creating competition or securing return on investment.

The conference is free to attend and aims to stimulate debate on the subject. Speakers include George Siolis from Europe Economics, Frank O'Donnell, Director of eBusiness at Scottish Enterprise, Dr Keith Monserrat, Sigma Technology Group plc and Richard Cockburn, a Partner specialising in competition and regulation at Shepherd and Wedderburn. Paul Carlyle from Shepherd and Wedderburn will chair the event.


« Back to Press Releases