Ebusiness despatches: Jumping on the broadbandwagon

It seems like everyone wants high-speed internet access for anyone who's interested (and even some people who aren't). So trust columnist Rene Carayol to question the wisdom of such a race...

The roll out of broadband internet access in the UK is a mess at the moment. Most of you probably don't need me to tell you that. But stick with me - this month I'd like to turn some of the assumed wisdom about the whole process on its head.

A few things are going on at the same time. For one, all we seem to hear about are government initiatives to provide citizens with broadband connections. The e-envoy talks about the subject a lot in the UK, and even the EU vowed this week to put broadband at the top of its strategy to boost ecommerce in Europe.

Then there is the tendency for every publication with space to spare to jump on what we could call the broadbandwagon. Don't get me wrong, there are some very good reasons why users - especially small businesses - should be able to get reasonably priced broadband connections, whether by DSL, cable or other means. Unfortunately, we are plagued by too many ill-informed commentators banging the broadband drum.

Take a column in The Business last Sunday penned by Andrew Neil. He may have earned the right to a good rant but among the smattering of factual inaccuracies in his opinion piece is the argument that we're in a race with the rest of the world to reach some kind of broadband nirvana.

The US leads the way, he tells us, and God forbid even the Germans have more DSL connections than us Brits (though he omits the 50 per cent or so of broadband connections in the UK that aren't DSL-based. In Germany there is no cable modem market given Deutsche Telekom's historical stranglehold on both telecoms and cable infrastructure - but enough digression).

My central point here is that making this into a race is dangerous. I fear for the telecoms industry, I really do. In the last few weeks we've had Global Crossing filing for Chapter 11 protection, McCleod going bust and now Carrier1 saying it expects to go into liquidation. Others are on the brink.

I can hear you ask what these companies - generally operating at a more macro level than companies providing connections to homes - have to do with broadband in the UK. Well, consider that 'leading' economy, the US, where broadband providers such as Excite@Home and several DSL providers have spectacularly failed. Then dare to consider the fate of NTL, with its billions in debt and reach across the UK economy. It's quite frightening, for them and their backers but also in a lesser way for customers.

Over-capacity and too much pressure to roll out services can have catastrophic affects. Obviously this isn't all the fault of government initiatives (they're usually pretty ineffectual, it must be said) or commentators upset about connection speeds. Indeed, a free market which allows companies to raise billions of dollars to pursue the broadband dream must take its share of the blame - and share the financial consequences, as it will.

Like the dot-com bubble, we may be on the verge of an industry that can't sustain itself. I have broadband to the home, and it hasn't changed my life. There are no killer apps, just the same old things, only slightly better.

As many articles have pointed out (see http://www.silicon.com/a48991 ), connections at the hyped rate often depend on all the other links in the chain being strong, including your PC.

Much more impressive is the always-on aspect of broadband connections but this can be provided without high speeds - just see how popular narrowband Blackberry devices or i-mode phones have been in North America and Japan respectively.

In essence, social inclusion and the internet is about many things but it's not merely about broadband. Any country will be better served by providers who don't go bust because of unsustainable business models. Following the inflated fears and spending because of Y2K and the dot-com implosion, the last thing we need is a telecoms meltdown. And that isn't said as someone inside the industry - I'm not - or someone who doesn't care about everyone benefiting from the information age.

And to anyone who disagrees with my logic here, I throw down a challenge. Tell me why the UK must win the broadband race, why you need a DSL or cable broadband connection to your home, now.

What's that old saying - less haste, more speed?