Ofcom's CEO talks about a broadband USO

damien

http://www.rogerdarlington.me.uk/commswatch/2006/11/towards_a_broadband_uso.html

and

http://www.ofcom.org.uk/media/speeches/2006/11/ofcom2006

"The same is true in telecommunications of universal service obligations and the Commission proposes to review the current Universal Service Directive next year.

Making distinctions between fixed and mobile voice and narrowband data services seems questionable as calls flit seamlessly between fixed and mobile networks. It may be more sensible to think in terms of a future right to a voice and data service, however delivered.

And there is a looming question about broadband. Its availability and penetration is rising rapidly in most markets.

If broadband penetration reached a certain tipping point – for the sake of argument, 75% of the population – might we see more profound changes in the way that public services and private goods are distributed? As the majority of users start to use services on line, might we take a different view of the nature of an essential universal service.

In such a world, the case for a broadband USO might be made. That would bring with it some tough questions about the nature of the obligation and, crucially, how it would be funded. As with PSB, the historic approach of funding USO out of incumbent monopoly profits must be re-examined as competition intensifies.

Today the assumption is that incumbents will deliver USO, with any cost shortfall being made up through a levy on the rest of the industry. But where USO requires the roll-out of new services, it might be better to create contestable funding models, as Chris Giles of the Financial Times suggests in our book, funding models which allow a range of operators to bid to deliver a USO."