Strategies for rural broadband The need for radical action Tim Johnson, Chief Analyst, Point Topic

1. Strategies for rural broadband The need for radical action Tim Johnson, Chief Analyst, Point Topic NextGen 2010: Broadband in the Rural Economy 23 November 2010 www.point-topic.com

2. Three points today • Rural areas need broadband more than urban areas • The rural-urban digital divide is growing • Radical action is needed to reverse this trend • By local communities, from the region to the village • By national government, to change the rules so rural broadband can work

3. Rural areas need broadband more • Improve access to resources • Leisure, work, health, education, security, government • Reduce environmental costs • Avoid commuting and other journeys • Support the shift from physical to virtual • Make it easier to earn a living • Remote working for ordinary people • Create the economic foundation for viable communities

4. Rural areas are falling behind • The gap is widening as bandwidth needs increase • Superfast broadband is the new target • Greater distances and lower population densities make it hard to finance • Our infrastructure index measures the gap • Takes the average of 6 speed-related indicators of broadband coverage • Rural areas behind urban on every one • Rural scores 25%, urban 67% overall

5. Rural is far behind on all infrastructure measures

6. And there isn’tenough money . • There is already a huge gap in the quality of broadband infrastructure between areas. • Unless there is significant public intervention the gap will get worse. • The £530m provided by the Spending Review is nowhere near enough. • We need to rebalance investment priorities in favour of broadband Diagram shows Point Topic’s Broadband Infrastructure Index band for each local authority, the darker the better.

7. Radical action is needed – by communities • Local pride, enthusiasm and JFDI are just the start • Only investment based on a working business model will deliver a lasting fit-for-purpose service • Go a step beyond the given - • Create the business case

8. Creating the business case • Many different parties will benefit • Who will contribute to the cost? • Foundation customers? Environmental funds? Developers and property owners? Infrastructure builders? • The case for investment must be made • Good data is one requirement – here is where Point Topic can help • But government needs to change the rules so rural broadband can work

9. Drilling down from the region to the village to find the most left-behind areas Drilling down 1: Derbyshire Dales has low take-up – 35.6%

10. Drilling down 2: find and select the lowest MSOA – 32.4% take-up

11. Drilling down 3: next, 003D is the lowest take-up LSOA – 28.2%

12. Drilling down 4: one COA is a total notspot with zero broadband

13. Drilling down 5: demographic make-up of the notspot COA

14. Radical action is needed – four tasks for government • Help the broadband business case to leverage wider community benefits • Provide some investment certainty • So that investment now is not gazumped by big players a few years ahead • A railway model - bidding for area franchises to minimise gap funding? • Tackle the absurdities of the fibre tax • Legislate for information transparency

15. Tim Johnson, Chief Analyst, Point Topic tim.johnson@point-topic.com 020 3301 3303 www.point-topic.com