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Superfast voucher scheme lowers the bar for urban broadband speeds

The government’s Urban Broadband Fund is being redrawn to incorporate a new voucher system. 

Yesterday, the Department of Culture, Media and Sport (DCMS) announced its ‘Consultation on Connected Vouchers’ scheme. The plan is that small businesses will be able to apply for vouchers providing cover for the costs of installing expensive superfast and ultrafast broadband connections.

Previously, the terms of the Urban Broadband Fund dictated that money could be provided for fixed-line connections providing speeds within 80-100Mbps. The voucher scheme means that companies can apply for funding for services providing speeds of at least 30Mbps. Now the bar has been lowered for urban broadband speeds.

Back to the drawing board: The Urban Broadband Fund could instead hand out vouchers for installation and cash for public WiFi

Read Recombu Digital’s guide to Super-Connected Cities and the Urban Broadband FundEd Vaizey, minister for culture, communications and creative industries said: 

“The voucher scheme is intended to stimulate the market to improve digital connectivity in participating cities, in particular for the benefit of SMEs, helping cities to create and attract new jobs and investment, and make the UK a more attractive place for digital companies to come and do business.”

This somewhat echoes what Virgin Media said when it raised objections to the plans of Birmingham City Council last December. 

Today, a Virgin Media spokesperson told us: “Where companies are already investing in world class connections, government has recognised public money should not be used to build more networks. Investing where it’s needed most, in digital skills, access and training, will drive use of next generation services amongst businesses and tap into an £18 billion growth opportunity for the UK economy.” 

The £18 billion figure comes from Go ON UK, the initiative designed to improve IT literacy in the UK, which would then indirectly benefit the British economy.

As well as a voucher scheme, public money could also be set aside for new WiFi networks in public areas. Any new scheme will also be drawn up ‘in a manner consistent with EU State Aid rules,’ which states that money can only be used in areas where services aren’t already available.

Last week we heard that Edinburgh City Council’s plans to put fibre optic broadband cable in the streets had been scuppered due to these very same EU rules. Town planners instead had a rethink and decided to splash cash on public WiFi and a voucher scheme for small businesses. 

That sounds an awful lot like what’s being proposed now by DCMS, so one wonders whether Edinburgh planners caught wind of these plans in advance. Either that or the DCMS saw what they were doing and decided to take a leaf out their book.  

It is understood that allocation of the £150 million from the Urban Broadband Fund will not change, just the terms on what the cash can be spent on. 

The consultation on UBF vouchers closes on July 24, 2013.

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