Communications: Digital Britain

My Lords, I thank both noble Lords for their responses to the Statement. If we are trading disappointments, I am rather disappointed by their respective disappointments. The report clearly says that it is an interim report. We have been clear from the beginning that this process would come in two stages because we were seeking to resolve some significant questions. I can but imagine what the response from the two noble Lords would have been had we brought determinative answers on every single one of these issues without any form of proper analysis, consideration or consultation. As both noble Lords have identified, these are profound questions about connectivity, infrastructure, content, rights and legality. We have been working on this project for 11 weeks. I struggle with the notion that we are being slow. The noble Lord, Lord Luke, asked specific questions on where we have offered certainties. We have offered real certainties on at least eight of the 22 areas. We have said determinatively that we will commit to digital audio broadcasting and radio. We have said determinatively that we will commit to the funding and creation of a second public service provider alongside the BBC. We have said that we will commit to the creation of a universal service commitment in broadband for the first time. On the point about speed raised by both the noble Lords, Lord Luke and Lord Clement-Jones, ““up to 2 Mb/s”” is the phraseology in the document. That would be the most ambitious universal service commitment of any country in the world. However, to be clear in the interests of the debate, we are in no way, shape or form suggesting that ““up to 2 Mb/s”” should be the ambition for what the country should have; far from it. We are saying that, in 2009, it is time for us as a country to consider removing the universal service commitment that is currently only for telephony and replacing it with a universal service commitment for connectivity. I would be the first to say that that is a bold step. I have been working in this industry for 10 years. Only eight and half years ago, we sold the first ever broadband connection in this country. Only four years ago we introduced the framework to give us the most competitive market in the world. To introduce the suggestion of a universal service commitment today is a significant step, and one that will be welcomed by industry and users alike. The next-generation access question, raised by the noble Lord, Lord Luke, is a significant infrastructure question for the United Kingdom. We make a clear case in the document that there is good evidence that the market will provide significant investment for up to 60 per cent of the country, and perhaps more. Of the remaining 30 per cent, however, there will probably be a question of the case for public incentives. We make it clear that we will do the work on that and bring back our answers before the summer. On rights and content, I absolutely share the view of the noble Lord, Lord Clement-Jones, that the creative and content industries are a powerhouse sector in the British economy and one of which we should be rightly proud. We must find a way to find a platform for those industries to continue to innovate, be the envy of the world and thrive in the new world which we describe in the report, while giving them a legal framework. To describe the rights agency as a quango is both inaccurate and unhelpful. It is, as suggested, as co-regulatory industry grouping. We have four examples of that already in the communications sector, which work extremely effectively. We have, in the mobile telephone sector, ICSTIS, now PhonepayPlus, paid for by a small levy: 0.34 per cent of revenue of any participating company. It provides a safe framework for the development of the mobile telephony industry, giving it freedom to adapt with the changing circumstances of technology. In the advertising industry we have the BACC, a clearance and screening group, again paid for by a small, level, levy, to provide a point of gathering for the industry to share technology standards and applications that could help resolve the content and peer-to-peer filesharing questions. The legislative backdrop on infringement is necessary. We have listened long and hard to the content industries and believe that we have struck the right balance between providing a legislative backdrop while at the same time not trying to put in place in legislation what might be unworkable firm solutions. On the BBC, we are clear in the report that the BBC will be a mainstay of any future market. We are equally clear that it needs to continue to accelerate its approach to partnerships and engagement with the rest of the industry. However, we are, I hope, also clear that we wish to create a second large-scale public service provider. Indeed, there has been much discussion in the broadcasting industry, and two significant reports of substance from Ofcom, the latest only received last week, on this question. We have made a clear statement in the report that we accept those recommendations; that we commit to the creation of a second large-scale provider; and that, between now and the summer, we wish to do the work, the due diligence, on how to construct that and create an organisation that is both sustainable as well as conceptually desirable. That is a significant task of work. It is not an easy thing to do and must be done with due care and attention, not least because we are talking about the value for money questions of public assets. We will do that work, and I am confident that, when we have done so, we will end up with a recommendation that we can bring to this House and the other place to give us two large-scale UK content businesses of which we can all be proud.