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Brits Oppose UK Governments Next Gen Broadband Tax

Posted 1st March 2010.

The results from 561 respondents to ISPreview.co.uk’s latest survey have revealed that 74.3% of British people do not support the Labour Government’s plan to introduce a 50p +vat per month tax (‘Next Generation Fund’) on all fixed phone lines. Revenue from the NGF (estimated to be £175m per year) would be used to support the rollout of next generation broadband services to 90% of the country by 2017, with a focus on less profitable areas, such as rural locations.

Respondents to the survey were also asked which alternative solution they would prefer, which turned up some interesting results. The Conservative party plan to use part of the BBC’s existing TV Licence fee (the 3.5% ‘Digital Switchover’ budget) gained the greatest single vote of support from 31.7% of respondents. The idea of cutting the controversial ‘Fibre Tax’, which taxes the rateable value of the basic next generation infrastructure, gained the next most significant portion of support with 24.2%.

Funding the rollout of next generation broadband services purely through private sector investment came in third with 23.7%. Meanwhile support for the 50p phone line tax itself was incredibly weak and gained just 11.7% of the vote. Suffice to say that respondents were fairly split between the main choices, although the 50p tax was clearly the least popular by a significant margin.

"What comes out clearest is how the majority of respondents agree that next generation broadband will need some sort of support and cannot merely be left to the private sector, which would result in many rural areas being left without access to superfast broadband," commented ISPreview.co.uk’s Editor and Founder, Mark Jackson.

Concerns have also been raised about consumer demand for superfast next generation services, such as Virgin Media’s 50Mbps cable product and BT Wholesale’s new fibre optic based FTTC (40Mbps) and FTTP/H (100Mbps) technologies. However, when asked whether a truly superfast connection would benefit them, 61.3% of respondents gave a resounding ‘Yes’ and 18.3% were unsure, the rest (20.3%) said ‘No’.

"The most important point to remember about future broadband is not the headline (advertised) speed but its underlying infrastructure improvements. Today most of the country is still served by dated and slow copper cables, which is why average UK speeds are often closer to 4Mbps (Ofcom’s April 2009 data) than the dizzy heights of ‘up to’ 20-24Mbps as advertised by ISPs using existing technologies (e.g. ADSL2+)," concluded Jackson.

Everybody should get a minimum speed of 12-15Mbps (FTTC) or faster with fibre optic based broadband services; not to mention significantly faster upload speeds. This would be a radical improvement. Sadly it could still take time for the affordability and coverage of such services to improve before they are seen as truly mass market products and that will require additional support, although for now the government’s 50p tax solution is not favoured.