UK Government

Department for Business, Innovation and Skills: Next generation fund launched: UK to benefit from £1 billion investment in super-fast broadband

Press Release   •   Jan 07, 2010 11:15 GMT

Rural communities and hard to reach areas who do not have access to next generation broadband will benefit from a share of £1billion of Government investment said Business Secretary, Lord Mandelson today.

The investment will upgrade the UK’s digital infrastructure to bring super-fast broadband to 90% of the country, essential if the UK is to remain globally competitive as estimates suggest that private investment will only reach up to 70% of the population by 2017.

The Next Generation Fund will provide the UK with a world class communications network to bolster innovation and services in digital content.

Launching a consultation on how proceeds from the Next Generation Fund should be spent, Lord Mandelson said:

“This investment is about bringing the future of broadband to areas of the country that would otherwise miss out. We cannot underestimate the opportunities this will bring for homes and businesses which is why we are taking action to make sure everyone benefits.

“Already the market is delivering superfast internet speeds of 50Mbps to half the country but we cannot be certain that it will reach the communities that are not currently served, which is why we are putting in an extra £1billion to support the market.

“By upgrading our networks we will put the UK at the fore of rapidly developing technologies which will bring jobs, boost business potential and grow our digital economy.”

Areas with little or no broadband provision are likely to benefit from the investment with Ministers determined to ensure that homes and businesses in hard to reach communities are not left behind.

The objectives of the Next Generation Fund are:

  • To support Digital Britain’s aim to roll out next generation networks to at least 90% of the UK by 2017;
  • To support economic growth by incentivising market investment in communications infrastructure to meet the needs of businesses and households;
  • To maximise links with the Government’s Universal Service Commitment – a parallel broadband investment programme to ensure every community has access to 2Mbps broadband connection by 2012.

Government is now consulting on the most effective way to deploy the investment and will soon appoint a procurement team to oversee the delivery and management of Next Generation Access.

The consultation paper outlines the high-level benefits next generation broadband offers, including:

  • Telemedicine: provides real-time interaction between doctor and patient so consultation and even examinations can be undertaken online.  This brings huge benefits particularly for the elderly and those who live in rural communities
  • Teleworking:  uses two-way video conferencing to facilitate working from home.  Brings social and economic benefits to those who are less mobile such as people with disabilities and single-parents.  Teleworking also has potential environmental benefits by reducing carbon emissions through decreased traffic congestion.
  • Cloud computing: enables businesses to use the internet to store and access software and data and share resources.  Results in a lower carbon footprint, less investment in computing equipment, access to cost effective technology solutions that can be used quickly, cheaply and less disruptively.

Faster upload and download speeds, and greater reliability and consistency will bring higher productivity, increased innovation, boost e-commerce and provide greater consumer choice and access to time-saving e-government services.

The consultation considers issues that will inform the role of the procurement team.  These include ensuring there is competition within new networks to drive consumer choice and drive down internet service prices; whether the Fund should be deployed nationally, regionally or locally; and the best options for procurement.

As announced in the Pre Budget Report the ‘Next Generation Fund’ will be raised by a duty of 50p on all fixed lines as previously announced in the Digital Britain White Paper.

The Government is also today publishing its growth strategy, Going for Growth, outlining a strategic approach to boost the UK’s public finances through sustainable growth.

Notes to Editors:

  • The consultation on how the Next Generation Fund will be spent can be found at:  http://www.berr.gov.uk/consultations/page54155.html
  • A further consultation on how the fund will be raised was published by the Treasury on Friday, 11 December and can be found at: http://hm-treasury.gov.uk/consult_landlineduty.htm
  • The consultation has been issued to various stakeholders across the telecommunications and internet provider industry.  They have 12 weeks in which to respond.
  • The recommendations for the Next Generation Fund made in the Digital Britain Report, published in June 2009:  http://www.bis.gov.uk/building-britains-digital-future Digital Britain is the government’s vision of an economy and society where core working activities are based around knowledge, skills and information. It represents an ambitious and strategic plan to accelerate growth in the digital industries and cement the UK’s position as a world leader for innovation, investment and quality.
  • The Next Generation Fund builds on the Government’s Universal Service Commitment which will deliver access of 2Mbps broadband to the whole country by 2012.
  • Department for Business, Innovation & Skills

    The Department for Business, Innovation and Skills (BIS) is building a dynamic and competitive UK economy by: creating the conditions for business success; promoting innovation, enterprise and science; and giving everyone the skills and opportunities to succeed. To achieve this it will foster world-class universities and promote an open global economy. BIS - Investing in our future.

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