Digital Britain – what's in it for business?

Enterprises need to have a backup plan if Digital Britain fails to get rolled out properly

This week Lord Stephen Carter of Barnes unveiled the final version of the Digital Britain report, a 240-page roadmap signposting how, where and when the UK will transition to a fully digital industrial economy. The increase in size over the 80-page interim report reflects the significant number of decisions, proposals and recommendations added to the final report.

Underpinning all the content needed by enterprises to thrive in this brave new digital world will be the provision of a network infrastructure able to deliver the services and applications. The report details two separate areas which will be important for business IT. First, the next-generation fibre-optic rollout to 90 per cent of the UK, and second the universal service commitment (USC) of 2Mbit/s to all of the UK.

In essence, Carter said the private sector will provide 60-65 per cent of next-generation fibre-based network connectivity, with the remaining area of the country for which there is not an economic case for rolling out fibre, being provided by various "market intervention" mechanisms. Carter included in these a 50p tax on all fixed line copper and cable connections generating £150m-175m per year.

Datamonitor principal broadcast and media analyst Adrian Drury said: " Obviously BT and Virgin Media will want their share, but there will be an opportunity for smaller ISPs with fibre rollout aspirations to apply for funding."

Antony Walker, chief executive of advisory body the Broadband Stakeholder Group, said the broadband levy will deliver greater than 85 per cent coverage.

"For the enterprise market, that's really good news. It means there is more certainty about higher services, upload, downloads, latency that allows cloud computing and the next wave of innovation in small businesses," he said.

"But it will take time to be deployed - but there won't be a market anywhere in the world where it won't take time to deploy next-generation networks."

Datamonitor's Drury said one of the most important decisions taken by Carter was the setting up of a Network Design and Procurement Group (NDPG), to oversee the USC rollout.

"Prospectively there's going to be £200m taken away from the BBC as part of the underspend on the digital TV switchover funding allocation which will be allocated to NDPG, and it'll be a real bunfight as to who these funds are allocated," said Drury.

BSG's Walker added: "The 2Mbit/s baseline is not such a big issue for businesses, although for some firms it will allow their employees to work from home for the first time."

However, Quocirca's principal communications analyst Rob Bamforth has reservations about the pluses for business in Carter's report.

"Being blunt I don't think there's enough in the report for enterprises," he said.

Bamforth pointed to research on small business internet use he conducted last year showing that many were well down the track, and already wanting to use lots of more interesting network services such as voice over IP,videoconferencing and remote backup.

"It's something they'll be coming to depend upon," he said.

Lord Carter's report includes "26 outcomes, 26 proposals and 25 recommendations," and he hopes, of course, that they will all come to pass. But Bamforth raised the spectre of a stall in the rollout, with the unthinkable proposition that the plans would not happen.

To address that contingency, Bamforth said that enterprises ought to be working on a plan B in case there is no fast connectivity to their constituency - their customers, suppliers and employees.

"If it's a consumer-focused business, that possibility is going to have to be factored in. If I'm a bank, it'll mean me not being able to push advanced services online – I'll have to keep a storefront presence," he said.

Bamforth said delays in rollout could hit any business with a "direct touch" with customers that have been trying to offset that to an internet presence.

"They will have to recognise that if the network service isn't there, they'll have to have an alternative, and in certain areas that'll pose challenges for enterprises," he said.

Another area which could cause potential problems and expense for enterprises is having to install infrastructure or applications to deal with the next generation Internet Protocol – version 6 (IPv6). Currently estimates vary as to when the current version used – IPv4 – will have its address space exhausted, but 2011 appears to be a consistent figure.

Datamonitor's Drury said nobody will roll out IPv6 yet.

"With the cost of capital being what it is, there has to be a clear earn-out on all projects, and nobody's going to invest in this unless there's revenue at the back end," he said.

As to an overall view of the report, Quocirca's Bamforth concluded: " Consider it this way: the industrial revolution was all about getting the power to move things and people, the silicon revolution is about getting sufficient power to not have to move things or people – this report come out as very un-aspirational as well as un-inspirational."