The superfast lane to nowheresville

Are we focusing on the wrong sort of connectivity?

Policy Exchange has a new report out today, and I'm not going to lie, my attention was piqued by the pun-tastic title, The Superfast and the Furious, because, wow.

Anyway, it makes a number of interesting recommendations, mostly going against the trend in recent years for promoting the spread of so-called "superfast" broadband – usually delivered by fibre-optic cables, and largely confined to dense built-up areas.

Instead, the authors, Chris Yiu and Sarah Fink, argue that the government should refocus on helping the people who remain offline, since:

Whether or not the UK has the fastest superfast broadband relative to other countries is a redundant question.

There has always been a target of delivering broadband of at least 2Mbps to the 10 per cent of houses which won't be able to get superfast broadband, and in fact, it's that target which the report suggests may need to be recalibrated. It points out that setting an absolute level of what constitutes "acceptable" broadband speed is foolhardy: when the target was set, 2Mbps was fast; now it's the minimum requirement to use iPlayer, a standard technology; tomorrow it may be too slow to do other things which we have come to expect as standard. One option they propose instead is to track "broadband poverty", identifying the number of houses where the best broadband option is a certain percentage below the median.

The report is an important counter to the prevailing trend in internet policy, which seems to be driven a bit too much by the fact that superfast broadband is cool, while replacing miles of copper wire with slightly better copper wire in rural Cumbria isn't. After all, the leap from no internet to some is far greater than the leap from fast to superfast – and the damage caused by having none at all is real and concerning. A recent Oxford University study found that "there are substantial educational advantages in teenagers being able to access the internet at home", for instance, while the report itself cites the fact that small businesses which "embrace" the internet grow "substantially faster" than those which remain offline.

But the thing which the report misses is that there's a second priority which ought to be key for the government to press for, and that's reliability. The authors pass this off as a matter for competition:

For the general public, broadband price and reliability matter as much as raw speed, and the optimal trade-off will vary from home to home and over time. The best way through is to let the market balance different needs, which in turn requires effective competition between providers.

I'm not so sure that's correct. Advertised reliability is certainly something which providers compete on, but due to the stickiness of the market, it appears that they rarely need to live up to those promises.

Increasingly, uptime, rather than speed, is the limit to wider adoption of the "internet economy" which Yiu and Fink are so keen to trumpet (citing figures which show that around eight per cent of UK GDP is due to the internet); the fear, or experience, of a connection failure can lead to understandable reluctance to make too many operations dependent on the net. This is true of a number of hoped-for internet driven productivity enhancements. Consider telecommuting, for example. Anyone who has experienced multiple-day outages will know the fear that one could happen when crucial work is riding on it.

The question is whether more reliable connections can be achieved through the market alone. I have my doubts. The market for high-speed internet only really became competitive once bogus claims were cracked down on by the ASA – but providers have steered clear of making similarly testable claims about connection stability. And switching companies remains such a hassle that it exerts a massive drag on the efficiency of competition to motivate anything.

Still, we must hope for a b++++DROPPED CONNECTION++++

A car drives fast. This is a metaphor. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Getty
Show Hide image

Theresa May’s Brexit speech is Angela Merkel’s victory – here’s why

The Germans coined the word “merkeln to describe their Chancellor’s approach to negotiations. 

It is a measure of Britain’s weak position that Theresa May accepts Angela Merkel’s ultimatum even before the Brexit negotiations have formally started

The British Prime Minister blinked first when she presented her plan for Brexit Tuesday morning. After months of repeating the tautological mantra that “Brexit means Brexit”, she finally specified her position when she essentially proposed that Britain should leave the internal market for goods, services and people, which had been so championed by Margaret Thatcher in the 1980s. 

By accepting that the “UK will be outside” and that there can be “no half-way house”, Theresa May has essentially caved in before the negotiations have begun.

At her meeting with May in July last year, the German Chancellor stated her ultimatum that there could be no “Rosinenpickerei” – the German equivalent of cherry picking. Merkel stated that Britain was not free to choose. That is still her position.

Back then, May was still battling for access to the internal market. It is a measure of how much her position has weakened that the Prime Minister has been forced to accept that Britain will have to leave the single market.

For those who have followed Merkel in her eleven years as German Kanzlerin there is sense of déjà vu about all this.  In negotiations over the Greek debt in 2011 and in 2015, as well as in her negotiations with German banks, in the wake of the global clash in 2008, Merkel played a waiting game; she let others reveal their hands first. The Germans even coined the word "merkeln", to describe the Chancellor’s favoured approach to negotiations.

Unlike other politicians, Frau Merkel is known for her careful analysis, behind-the-scene diplomacy and her determination to pursue German interests. All these are evident in the Brexit negotiations even before they have started.

Much has been made of US President-Elect Donald Trump’s offer to do a trade deal with Britain “very quickly” (as well as bad-mouthing Merkel). In the greater scheme of things, such a deal – should it come – will amount to very little. The UK’s exports to the EU were valued at £223.3bn in 2015 – roughly five times as much as our exports to the United States. 

But more importantly, Britain’s main export is services. It constitutes 79 per cent of the economy, according to the Office of National Statistics. Without access to the single market for services, and without free movement of skilled workers, the financial sector will have a strong incentive to move to the European mainland.

This is Germany’s gain. There is a general consensus that many banks are ready to move if Britain quits the single market, and Frankfurt is an obvious destination.

In an election year, this is welcome news for Merkel. That the British Prime Minister voluntarily gives up the access to the internal market is a boon for the German Chancellor and solves several of her problems. 

May’s acceptance that Britain will not be in the single market shows that no country is able to secure a better deal outside the EU. This will deter other countries from following the UK’s example. 

Moreover, securing a deal that will make Frankfurt the financial centre in Europe will give Merkel a political boost, and will take focus away from other issues such as immigration.

Despite the rise of the far-right Alternative für Deutschland party, the largely proportional electoral system in Germany will all but guarantee that the current coalition government continues after the elections to the Bundestag in September.

Before the referendum in June last year, Brexiteers published a poster with the mildly xenophobic message "Halt ze German advance". By essentially caving in to Merkel’s demands before these have been expressly stated, Mrs May will strengthen Germany at Britain’s expense. 

Perhaps, the German word schadenfreude comes to mind?

Matthew Qvortrup is author of the book Angela Merkel: Europe’s Most Influential Leader published by Duckworth, and professor of applied political science at Coventry University.