Labour breaks an emerging consensus on Broadband Policy?

Unrealistic targets versus re-creating the BT Monopoly?  

Boris Johnson set the pace for the current Broadband debate back in June . His promised to pull full fibre roll-out forward to 2025 was thought by many to be too ambitious . Industry leaders responded with an open letter on what Government must do to enable them to deliver.

Jeremy Corby then promised to make broadband free but not until 2030, using a renationalised Openreach, part paid for by taxes on Amazon, Facebook, Google etc. The headline reaction was more spectacular than that to the challenges of meeting Johnson’s 2025 target.

The LibDems promised a number of actions but not targets or fibre.  Neither Brexit Party nor Greens have said much although Plaid Cymru has promised full-fibre by 2025 as part of its Green Revolution . Plaid also says neither the English nor BT can be trusted with Welsh Broadband. It had previously gone into more detail with a three point plan.   Meanwhile the SNP has yet to sign off its superfast contracts.

Broadband roll-out is a journey which determines our future opportunities. Whose map, if any, do you trust.

The arguments about how the critical communications infrastructure of the future should be delivered are complicated by a claim that BT would have rolled full fibre across the UK in the 1990s but for Mrs Thatcher’s insistence on competition from the cable companies.  Whether that delayed or expedited investment is a matter for debate. It did mean we have a greater variety of network technologies, topologies and routings. That is healthy if you believe that smart infrastructures  need diversity for security and resilience. It is unhealthy if you believe the world took a wrong turning when the Internet overtook the orderly, ITU-planned, world of X25.

But we cannot progress very far unless and until we address the network construction skills problems (quality as well as quantity that threaten to derail network construction and maintenance as they did for Cable TV in the 1990s.

Also critical is the need to put full-fibre networks into the context of the local and national infrastructures (including ubiquitous fixed and mobile wireless) for smart cities, green technologies and economic competitiveness and survival. No one size fits all needs. Every smart community (let alone City) will probably need at least one Internet Exchange to handle local inter-operability. London alone will probably need more Internet Exchanges than BT currently has “telephone” exchanges. [Note that LINX is itself helping lead the “devolution” to local exchanges].

Getting there from here is an evolutionary journey.

Hopefully the fibre “pipes” being installed today will have lifetimes comparable with the copper “pipes” they replace. The switches will not. Their upgrade cycles will be more akin to those of computer systems. Keeping them in sync will be equally complex. Hence “catastrophic” network failures with whole towns running slow, or going off air, sometimes for days on end,  when upgrades to routers/switches go wrong.

Do you want fast or free? Would you trust a monopoly, nationalised BT to deliver?   

Half of all  Conservative Policy Forum groups, the parties main consultation arm, put fibre broadband top when asked what they most wanted to see after Brexit, next came investment in skills, with a focus on high level apprenticeships. Hence Boris Johnson’s inclusion of a 2025 target in his first statement on post Brexit priorities.

Hence also the mixed reception when Jeremy Corbyn slipped the target to 2030, made it free and tied it to renationalising BT.

Free broadband is understandably popular It has support from 2/3rd of voters . But not if it comes courtesy of a renationalised monopoly BT. Here voters are split almost exactly three ways – for, against and don’t know. Less than a third believe BT knows best and that Mrs Thatcher made a mistake when she refused to reinstate the BT monopoly in 1990 (Instead she wanted it to compete with the Cable Companies to bring “full motion video to every home by 2002”).

A similar proportion, just under a third) remembers that price and quality of service only began to improve when BT was forced to compete. Like the CBI, INCA and Tech UK they fear that renationalisation will result in 5 – 10 years of delay and £tens of billions of avoidable cost. Some also think of the millions of jobs and £hundreds of billions of lost tax revenues as the UK falls further behind its overseas competitors at a time when it was just beginning to catch up.

But more than a third do not know who to believe.

That confusion is not helped by misunderstandings as to how to we got to where we are today.

The Consensus that fibre was the future goes back to before the 1979 Election

The 1980s did not see  Labour politicians calling for fibre broadband in the face of opposition from a backwards thinking Tory Government.

There was an emerging all-party consensus during the run-up to the 1979 election, that fibre optic was the way forward. I was on both the TUC Policy study for the Callaghan Government and the studies for Sir Keith Joseph.  One of Mrs Thatcher’s speechwriters helped edit my paper, “Cashing in on the Chips”. The 1979 election came earlier than expected. Instead of being used as an advance discussion document it was published by Conservative Political Centre immediately after the election in March 1979, with double the normal print run.  It quickly sold out and had to be reprinted.

A key recommendation was “to re-equip the UK telecommunications network … Crash conversion of the switching system to digital … and installation of broadband transmission – similar to the North Sea gas conversion programme of the last decade“.

The recommendations were favourably reviewed on all sides, including by my Trades Union (ASTMS) and those involved in the TUC study – because I did not mention privatisation. I also avoided technobabble so the paper was covered in the Today Programme and I appeared on the Jimmy Young Programme. I was very nervous and totally unprepared. It was all too the good. My main memory is how he soothed my nerves as each record played, before milking me again to explain the next topic in terms his listeners could understand. He had not only read the paper, he fully understood the implications and wanted his listeners to do so as well. I should perhaps add that the paper also called for a micro in every school by 1982: the programme which kick-started the UK lead in educational technology.

The 1980s debate was on Privatisation and how to make a reality of Competition – not technology

Subsequently, in the early 1980s, there was consensus on the need for “liberalisation” (alias competition).  There was even consensus on the need for some form of competitive duopoly between the telecoms operations of the Post Office and of Cable and Wireless. They had different unions and different approaches towards meeting the needs of business customers for world class international communications.  The political difference was on privatisation of the telecoms operations of the Post Office.

Telecoms did not feature in the 1983 election. There was only one question in the entire campaign. I was point man IT policy and had a single call – from Sir Geoffrey Howe. He had an interesting question from a techie in his own constituency. I cannot remember what it was. I do, however, remember that we agreed a polite non-answer rather than raise the need for a policy response.

By the time of Peter Cochrane’s proposal for BT to move from piecemeal upgrades to a complete network overhaul the Government target was to have at least two operators providing “broadcast quality video” to every home by 2002 with radio (fixed, mobile, terrestrial and/or satellite) providing a third dimension of competition/resilience.  No wonder his proposal to recreate the BT monopoly got short shrift.  He was also seeking funding for BT to manufacture in competition with STC (fibre optic technology was invented at STL Harlow) and GEC (the world leader on optical switching technology).

The failure of competition in the 1990s

The Cable Companies failed to provide the expected competition for the same reason that BT could not fund its investment programme from its own cash flow. Treasury had withdrawn the 100% capital allowances that helped turn round the economy after the stagflation of the 1970s. In consequence the market was left to US and Canadian investors who could write off their investment against tax. The franchises were also too small for viability and a series of take-overs and mergers followed. Then the shortage of competent construction workers led to the break-up and poor reinstatement of road surfaces and pavements as cables (some coax, some fibre) were laid to serve each house in the area. That plus the death of trees whose roots had been damaged led to mass complaints and delays in planning permission.

By the time of the 1997 election the Cable companies were all but bankrupt and the idea of local loop unbundling was in play as the only way of providing competition to BT. It was particularly attractive to Labour Policy advisors who feared that Rupert Murdoch would snap up the Cable Companies as he had done with Satellite TV.

But investment in fibre backbones was roaring ahead 

Meanwhile BT’s investment in fibre had gone ahead. BT issued new shares from 1991 – 94 at ever increasing price as it accelerated the pace of investment to be able to provide broadcast quality video to the home 2002. Before Y2K BT had fibre to within a mile of over 80% of UK homes. After Y2K its investment programme accelerated again. BT did not do more rights issues. Instead it borrowed to fund fibre to the cabinet. By the time Ofcom was created BT’s investment programme was at running full spend. Meanwhile NTL was in Chapter 11 and the Telewest Shareholders had taken a 98.5% “haircut”.

Then came the implementation of Local Loop Unbundling under Ofcom.

The collapse of UK fibre investment came after Local Loop Unbundling destroyed BT’s investment case and share price and left its competitors with no imperative.

LLU was followed predictably and inevitably by the regulation induced collapse of the BT share price – from a high of £15 to a low of under £1. My 2015 blog was drafted mainly to illustrate the effect of regulatory policy on investment at a time when Ofcom was doing a strategic review which assumed its impact was neutral.

The cost of LLU not, however, just the termination of BT plans for fibre to the premises. BT’s spend on preventive maintenance was cut by 50%. Hence the need today to recruit and train thousands of engineers to test the safety of ducts and poles before its local networks are upgraded, let alone opened up for “physical infrastructure access“. A decade ago this would have been a relatively simple exercise. Today, after a decade of decay, it is a major task.

We have to catch up with the rest of the world before crapband costs our economic future

Tech UK has said most of what needs to be said on the costings and practicalities of Labour’s proposal. We also need to consider the impact of five to ten years delay on the rest of the economy. The UK will not only fail to leap frog its competitors with world class, resilient, mesh, infrastructures (hot standby over three or more networks for most businesses reliant on Internet access). It will fall further behind as they power ahead. Much of the UK, including most of the countryside, will remain reliant on legacy crapband (copper, rust and aluminium and other pollutants) for the next decade or more.

And skills is the critical point of leverage

We need to look much harder at what needs to be done to expedite investment in building the infrastructure – who-ever does so.

Here I would to go back to the 1979 election manifestos and what came afterwards. “Cashing in on the Chips” did not mention privatisation. I also paid my political levy. I was therefore in good odour with my Union (ASTMS). I was invited to contribute “New Technology – some points to discuss” to their journal. The context was the points they might wish to make in their new recruitment campaign. I will quote a few:

• ASTMS should be endeavouring to block the recruitment of skilled staff in short supply until all internal staff, particularly the older ones with no promotion prospects, have been screened for aptitude …
• Salary under training away from home should be treated as an educational grant (i.e. tax free) with expenses additional …
• We must rebuild the Adult Vocational Education System at a local level. If the local authorities won’t respond, then go to the government with specific parliamentary questions via our Union Sponsored MPs and concrete proposals

ASTMS is now part of Unite. I would commend these points to those now running the Union if they wish to expand their paying membership. [As a retired member I am an now inactive freebie].

Particularly network construction skills   

It is almost exactly a year since the round table which identified what needs to be done and by whom. I summarised the discussion and recommendations in a blog earlier this year   When I retired (for the fourth time) at Easter I handed over my work in this area (via the DPA Digital Infrastructure Skills Sub Group) to the Chief Executive of the Highways Electrical Association . His members build and maintain most of our fibre communications networks. They are already building and maintaining first generation 4/5G networks (e.g. for smart lighting and signalling). I know they are seeking to identify local authorities willing to expedite planning permission to enable local FE Colleges to run short courses (to existing UKAS accredited standards) in using modern construction equipment to build networks and reinstate roads/pavements afterwards. There is also a need to expedite planning permission for “pole parks” to train engineers for BT and others to tackle the backlog of overhead network maintenance.

This may look mundane but it is a critical point of leverage.

Once planning permission has been secured the full BT programme for opening/upgrading its training centres can move forward. Once planning permission has been secured others can start working with FE Colleges and Local skills programmes to give NEETs the skills to use modern construction equipment (and not just to built comms infrastructure). Until then, almost everything else is piss and wind, Those who think we can import the necessary skills should take another look. Even if this was politically acceptable, they would have to be assessed and/or retrained. It is quicker and cheaper to train our own – provided the facilities are created in advance.