The logic of broadband

The internet is a bigger part of the British economy than education, healthcare or construction. Britons generate more money online than any other G20 nation. But when it comes to high-speed broadband, the country is falling behind.

The UK\’s average download speed is ranked 16th in Europe, according to IT company Akamai, and experts warn that the country is beginning to miss out as a result.

, high-speed broadband is not required to gain economic value from the internet. For we are gaining more economic value than others while having less high-speed broadband.

Not that The Guardian seems to be aware of this point. For they go on to say that obviously the answer is that the State should organise a monopoly company to roll out high-speed broadband. Apparently so that we can all have multiple channels of HDTV to watch as singletons.

Which doesn\’t in fact sound like a huge addition of economic value to be honest.

19 thoughts on “The logic of broadband”

  1. Yet another case of taking one particular aggregate statistic and imbuing it with too much meaning.

    The arguments coming up are identical to the arguments that were used to force through nationalisation of the telegraph in 1868. “There aren’t enough telegraph offices in the sticks!”

  2. Broadband speed is adequate for 99% of everyone’s internet usage. It’s fast enough for anyone accessing a web page and shopping online. It’s also fast enough to cater for a bit of video streaming from iPlayer or 4OD.

    What it isn’t fast enough for is for everyone to multiple channel video constantly streaming. But that doesn’t need fibre to the home, that just needs a good backbone.

    I’m with TalkTalk and their bought-in Tiscali TV service which is over broadband. Pretty good with on demand video and catchup and quality is equal with freeview.

  3. They miss the point everytime.

    Takes a special talent to write on anything real world or economic for the Grauniad.

    They encourage the socialistpaths to make unnecessary (and therefore bad) investments everytime.

    But think of the jobs!!! They scream. Argh!!

  4. Is there anything that The Grauniad thinks would be improved by not throwing state money at it? If not, their opinions are not worth the paper they’re written on. I think the meme here is that failing left wing newspaers should be nationalised, firstly to save them for the nation and only secondly so the journo’s salaries will continue to be paid.

  5. SBML

    What we don’t have is suitable capacity for more home and mobile based working. Given that we have incurably congested roads, and poor public transport (outside London, at least), and comedy house prices for anything within 25 miles of a real employer… this is something which it would be nice to see improved… less time/money spent burning fuel in traffic jams is a win for quality of life, efficiency, AND all the fluffy animals and wotnot.

    Of course, that we could do with things being made better is not to say that the state must step in and do it.

  6. TTG,

    I’m not convinced that the aggregate capacity for internet-based working is proportional to aggregate broadband speed. Maybe a Keynesian can draw us a nice graph of “the marginal propensity to work in our pyjamas” (MPP) as a function of “aggregate access to The Pirate Bay and”.

    Seems to me it’s more of a minimum speed thing, which is pretty much anything faster than dialup for most applications.

  7. Seems to me it’s more of a minimum speed thing, which is pretty much anything faster than dialup for most applications.

    Not now – and not if your employer is wedded to Outlook / Exchange (which uses far more bandwidth than SMTP). Dial up simply doesn’t hack it (I had a VPN on 56k dial-up a few years back. Yuck.)

    Nowadays, if you’ve got any form of broadband, however, it isn’t max or even min bit-rate so much that limits your working as other forms of comms limitation – such as latency and reliability.

    I use a VPN across my Virgin cable modem – speed isn’t an issue (and we haven’t shelled out for the gamer / pirate level hyper-drive version.) There are regularly connectivity and other issues, though. Establishing suitable connectivity for a large %age of your workforce being at home is quite different from allowing the small number of professional road-warriors to pick up their emails from hotel rooms or airport lounges.

  8. I saw a spot on TV about rural broadband a few weeks ago.

    There was a bloke running a business in a village called Robin Hood’s Bay. He had a 1-year ISDN deal from BT, with a good price for 12 months and then £silly. He liked the speed, but didn’t like the price he was going to have to pay.

    So he talked to other people in the village, and they got together and sorted it out. IIRC they got a satellite dish to link the village to the outside world, and a load of wireless boxes on people’s roofs to link everyone’s computers to the satellite dish.

    The TV showed them having a meeting to plan an upgrade- round a table in the local pub.

    Not a hint of the State. So it must be evil.

    Oh, hang on…
    “The Bay Broadband Co-operative is a ‘not for profit’ Social Enterprise Co-operative”.

    What’s not to like?

  9. OK, found the Akamai report at

    The main thing to note is that whilst we are 16th in Europe, as you scan around the map, the differences are very small.

    We get 4.9mbps. Germany has 5.0mbps. Lithuania gets 5.3mbps. Austria gets 5.2mbps. Hungary gets 5.2mbps. Slovakia gets 5.2mbps. The scanadanavians get between 5.5 and 5.9mbps.

    And yes, this is all about video, and being able to watch ICanHazCheezeburger in 1080p isn’t going to create the next industrial revolution.

  10. I’m sat in the garden, deep in rural Dorset, working from home (and the only reason I’m not still in my pyjamas is that I’ve been up to the pub for a lunchtime pint).

    Broadband speed according to an online speed checker is 6.2mbps. Upload speed a fraction of that.

    But it works for everything I need it to. Super-fast broadband would make no difference to what I can do, my ability to work remotely, or even my overall productivity.

    Yes, there was a huge change from dial-up to broadband, but going further would not make any practical difference.

    I’ve spent more time reading this discussion about the benefits of superfast rural broadband than I would have saved if I had it.

  11. I work with foreign clients over the Internet. Nice if you can get 5 or 6 mbps but because of copper wires can only get 2 mbps (in a suburban area, not the countryside). The result is frustration and embarrassing delays. It’s also impossible for me to carry out studio work that involves live streaming. Faster broadband across the country would open up many opportunities for those who currently struggle with pathetically low speeds.

  12. Isn’t complaining about indadequate streams for live streaming video for a business in certain areas a bit like building your factory in the middle of the countryside, then demanding that somebody else provide a high quality road, railway, etc?

    Manufacturing businesses congregate around good transport (roads, docks, railways etc). Does it really make sense to demand that the infrastructure mountain be moved to Mohammed?

  13. Easy to say, Ian, but we’re in a recession and house prices are crazy, so it’s hard for a one-person business just to pick up sticks and move. The price of accommodation in this country places restrictions on the mobility of labour. There’s an annoying sense of I’m all right Jackery about many of the comments on this blog.

  14. Tomfiglio-

    I’m not myself being I’m All Right Jackish. But this does seem to me to come down to the question of why people have business premises; it’s because they provide facilities they don’t have at home. If a business can’t afford to purchase the infrastructural necessities in its current location, then it’s in the wrong location.

    I work at home, and my middling broadband (nearly 6 megs when it doesn’t rain) is more than adequate for what I do. If it weren’t; if I needed 20 megs or 50 megs, that would just tell me I’m in the wrong place trying to do what I’m trying to do.

    You can only work at home if you can get the workplace type facilities at home, and you can only have a business premises in a village (for instance) if the village has the facilities you need. If nobody can provide those facilities in that location at a price you can afford, then you’re just in the wrong place, and that’s all there is to it.

    It’s like if you want to run a business that requires 1000A 3 phase electricity, in a village that currently has one pole mounted 100A single phase transformer. EIther you can pay the Electricity Company to install that supply, or your business isn’t economically viable in that location.

  15. I think the problem is – should we really all
    Pay (collectively) 17 billion so everyone can stream multiple full hd channels at home ? Sure it’ll have economic benefits for some – but enough for it be a good investment ?

    Tomfiglio – I’m sure you can find some places where houses are cheap and bt do infinity – you might not want to live there though



  16. Not “I’m all right Jack”, but more “what we’ve got works for the vast majority of businesses”.

    Taxing businesses that don’t need it to make a very expensive network, just to give a very small number of businesses greater mobility, seems a waste of resources.

    Super-fast broadband to towns, sure, there’s probably enough concentration there to make sense. But beyond that, as Ian B says, it makes far more sense for the businesses that need it to move to where it is, rather than expecting everyone else to pay for their mobility.

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