Chancellor Gordon Brown announced Wednesday a multi-million pound investment aimed at bridging the UK's digital divide and challenged industry to ensure affordable access to make the schemes work.
Speaking at the UK Internet Summit in London, the chancellor unveiled two new tranches of spending to tackle the problem. He revealed startling statistics illustrating how serious the growing problem is. One in two of the richest ten percent of the population have Net access compared to just one in twenty of the poorest.
To combat this, government plans to spend £10m on ten pilot schemes to wire up communities and another £15m to provide up to 100,000 recycled PCs to the poorest homes.
The first of these schemes will be in Kensington, Liverpool where 2000 PCs will be given away free to families living in the deprived borough. The chancellor admits affordable high speed Internet access "will be key" to make his plans work and reiterated the government's pledge to ensure everyone has Internet access by 2005.
Admitting that the UK "needs to do more", Brown challenged industry to bring Internet prices in line with the US "as quickly as possible". He stopped short of direct criticism of BT but did emphasise the need to open the telco's lines up to competition. "Both Oftel and the government want local loop unbundling to happen as quickly as possible, and I trust BT will comply fully," he says.
The chancellor says he is convinced the UK can avoid a society of information haves and have-nots and promised to monitor closely the success of the Liverpool pilot scheme. "If successful we will attempt to extend it to many more areas that need it... The principle behind it -- that no-one should be excluded from the benefits of the IT revolution, and that the digital divide can be bridged."
Chief executive of network provider WorldCom Liam Strong took the stage at the New Statesman sponsored conference after the chancellor. The telco has been at the forefront of ensuring a workable and affordable unmetered service (Friaco) is rolled out in the UK. Strong is not convinced the question of how the poorest families will pay for Internet access after receiving their free PCs has been answered. "It comes down to whether flat rate access is going to be available to everyone. It is a question for Oftel and we haven't yet got the answer to that," he says.
Strong claims Friaco "takes forever to happen". "We suggested Friaco last summer and it was finally delivered in June. The lesson is it takes too long to introduce change in the UK where regulatory intervention is required," he says.
There is also a problem that currently Friaco is only economically viable in urban areas, creating a subset of the digital divide. Strong believes this gap between town and country will continue long after unbundling. "Local loop could be limited to 60 percent of the population. While we appreciate how difficult Oftel's job is, it is frankly too little too late."
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