internet connection


Over the last decade or so, the UK government has attempted to lock in a basic level of broadband services across the UK.  The idea of this is to ensure that people have access to speeds of at least 10 Mbps from their ISP by 2020.  This is not just for people who live in big cities either.  They want this to apply to those in the country as well.  This is part of the government’s Universal Service Obligation (USO).  Originally, the government was thinking about spending money in order to provide rural residents with access to these speeds.  However, in a recent statement, they have confirmed that they will now go down the regulatory route.  Why?  Well, it’s enforceable from a legal perspective.

For those of you non-political nerds out there, you might be wondering why this makes a difference.  A government can spend money on a program or initiative and essentially make it happen.  This works often, but it then becomes a government initiative.  And one that potentially requires annual funding in order to keep the program going or maintain it.  But if the government decides to enact legislation, they then start to put pressure on the industry.  This is also effective – maybe more so because you’re laying a framework for improvements.  Whether those are economic, or sector specific, they are improvements nonetheless.  There are other ways of achieving these things – like through public-private partnerships (P3s), but I am not going to give you a civics lesson today. Either way, this is a good move.

Fiber optics

Culture Secretary Karen Bradley has stated: “We know how important broadband is to homes and businesses and we want everyone to benefit from a fast and reliable connection. We are grateful to BT for their proposal but have decided that only a regulatory approach will make high speed broadband a reality for everyone in the UK, regardless of where they live or work.”  The government will now begin outlining what the USO will need to include.  It’s anticipated that this legislation will be passed in early 2018, and it will take approximately two years to introduce these minimum speeds.

I find it interesting that they are going to pass the legislation so quickly.  But I also find it interesting that they are going to only provide two years for the industry to implement these speeds.  What if they can’t?  Well, that’s where the regulatory mechanism kicks in.  The government can then “enforce” the law in some way. Typically this is achieved through fines.  Which means there is an incentive for the industry to be able to get to this point.  Governments also don’t typically ask for things to be done willy-nilly.  There is a good chance that they have spent a ton of time and resources researching to ensure that these speeds are achievable in that amount of time.


Currently, the superfast broadband connections cover about 95% of UK homes and businesses.  These are connections that provide speeds of 24 Mbps or more.  This is expected to reach 98%, which means that by the time the USO starts to get enforced, there will only be a small number of areas that will need access to these connections.

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