Why Labour is rushing to push Digital Britain media masterplan

Gideon Spanier
30 Jan 2009

There was no doubting the importance that the Government attached to Lord Carter's Digital Britain Report, unveiled yesterday over breakfast and fruit smoothies in Downing Street. Carter, the broadcasting minister, was flanked by the Prime Minister and Business Secretary Lord Mandelson. BBC director-general Mark Thompson and ITV executive chairman Michael Grade were invited. So too were other leading players such as Channel 4 chief executive Andy Duncan and Elisabeth Murdoch, boss of super-indie TV production firm Shine.

Carter's interim blueprint is part of a co-ordinated effort by the Departments of Culture and Business and the media regulator Ofcom.

Together, ministers and regulators want to reshape the media landscape through a series of measures. Carter's key idea is to ensure universal broadband access by 2012. He also wants to strengthen copyright law and crack down on piracy in the digital world and to create a stronger public-service broadcasting rival to the BBC with “Channel 4 at its heart”. Restrictions on mergers for other TV and newspaper firms could be eased.

Media chiefs, struggling with a severe advertising downturn and rapidly fragmenting TV audiences, have given a cautious welcome to the proposals — as well they might. Ministers want the co-operation of industry leaders. But as Carter warned when talking about radio: “In the absence of an industry-agreed trading solution...Government will support an imposed solution.”

Carter was echoing the words of his boss, Culture Secretary Andy Burnham, who told TV bosses at last week's Oxford Media Convention: “We are only weeks away from clear decisions...There will be no time to draw breath.” Ofcom chief executive Ed Richards also talked at Oxford of the “need for urgency”.

And this urgency is understandable. The economic models that have sustained traditional media are collapsing as viewers and readers turn to the web. Channel 4 is losing money; Channel Five only broke even in the first half of 2008; dozens of local newspapers are being shut or sold. There is also a danger that other countries such as Germany and South Korea, which are also pushing ahead with superfast broadband, are stealing a march on Britain.

But in Whitehall, where change often happens at glacial speed, there is another reason to move quickly. With a general election a little over a year away, Labour knows time is running out.

Brown, Carter and Burnham — and arguably even Ed Richards, an ex-Blair media policy adviser — sense this is an opportunity to create an enduring legacy. Carter will publish a final report in late spring, with plans for legislation.

But crucially there are key questions that the Digital Britain interim report has not addressed — such as how much the state, rather than commercial operators, should be involved in creating a universal broadband network.

Neil Brown, partner in the communications practice at law firm Eversheds, says: “Without building the infrastructure, the content is always going to struggle. What can be achieved will be held back because it looks like it will be many years until the infrastructure for superfast broadband is sufficiently ubiquituous.

The conditions are quite difficult for companies like BT and Virgin Media. Everybody is short of capital. Operators are only going to go where there is an immediate return.”

Commercial firms do continue to innovate — witness BSkyB's announcement this week to roll out high-definition TV on its own satellite and fibre network, with £49 Sky+ set-top boxes.

Yet Brown of Eversheds argues the Government needs to start talking about investing significant money itself: “It's like building the motorways. You've got to dig up the copper and replace it with fibre. Once you put the fibre in the ground, the capacity is limitless.”

Opposition parties have seized on the Government's reluctance to spell out any funding commitments. “Without a roadmap to delivery it is surely an empty promise,” said shadow Culture Secretary Jeremy Hunt. He also criticised the fact that Carter is calling for two megabits per second (Mbps) of broadband access across Britain. Already average broadband speed is 3.6Mbps.

Few would deny that Carter's ambition to create a Digital Britain legacy is laudable. But he needs to put more flesh on the proposals — and time is short.