Interesting news over the weekend was the government’s idea not to sell the analogue TV signals, which become available in 2012, but instead use it as the carrot to get more investment into the country broadband infrastructure.
The government would be looking to emulate the 3G auctions where it made billions selling valuable air space licences to the telecoms industry. However with many burning their fingers on 3G (such as Vodafone) I would be surprised if the price would be so high this time around. Especially with the economic downturn the government are setting themselves up for a fall and I think are kidding if they think the telecoms industry will invest further into high speed links at the moment.
Remember the telecoms industry is there to make money, so if any of them thought they could show a good return by building a fibre network they would. The fact that only business can really afford it at the moment means rollout will be more organic. Prices are falling though and with BT lowing install costs to £2,000 and rentals starting from £500 per month for fibre it is much more affordable than a few years ago. This continuous cycle will build up the network which will naturally result in residential customers taking service. Remember spending £20 bn now on a new network infrastructure to meet our future demands will still only provide service to 20% of the current broadband client base as that is the only number expected to move over to it anyway.
So although a nice idea from the government it just goes to show that politicians once again are failing to understand industry and as we know from the financial debacle we need them to. Maybe a move back to having real people as MPs instead of career politicians is a necessary step?
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