Could copyright crackdown kill superfast broadband demand?
I just spent the morning at a Westminster e-Forum (ISPs, policy makers, politicians, etc) about the future of next-generation broadband in Britain.
One of the big topics of discussion was the notion of "killer apps" — specifically, what can we expect to be the big driver for consumers to sign up to a premium-priced high-speed broadband service. General consensus among panellists was that there would be no one killer app, but rather a variety of different applications with a need for speed.
Except, of course, for video — everyone can agree on that being a major driver for next-gen broadband uptake. According to Forrester analyst Ian Fogg, HD video requires a 6x increase in bandwidth, while 3D video (demand for which I personally doubt) requires something around 12x.
Once it went to Q&A, it struck me that one word had gone entirely unuttered: "file-sharing". If I may approach this issue from an anecdotally-based starting point, many of those I know who have signed up for Virgin Media's 50Mbps service — by far and away the fastest connectivity available in the UK now, and uncapped to boot — have done so in order to download high-definition movies etc more quickly. And they ain't paying for them.
If the government is so keen to crack down on unlawful file-sharing, won't that kill the demand for next-gen broadband, and thereby kill the economic case for investment?
So I asked, and of course no-one would say explicitly that the ability to unlawfully file-share is currently the main driver for almost anyone signing up for a 50Mbps service (I mean, what else would you use it for, given the apps that are out there right now?).
Responding, Virgin Media broadband chief Jon James, said that unlawful file-sharing did "represent a large and growing proportion" of superfast broadband usage. "It's a very challenging issue," he said.
Fogg pointed out that "fibre and next-generation access makes it easier to download HD movies and watch them, but it doesn't make it easy", suggesting that people will always choose a user-friendly, legal service over one that involves fiddling with codecs and such things.
"Video file-sharing will be a niche, not the mainstream," Fogg said.
Antony Walker, the head of the Broadband Stakeholder Group, later told me that video was less likely to be unlawfully shared online than music was a few years ago, because legitimate video services are coming out to coincide with the rise in demand — with music, the gap between demand and bandwidth capabilities on one hand, and the availability of legal ways in which to easily download tunes on the other, was much wider.
"There's less of a black-market opportunity," Walker said.
Incidentally, it turns out Virgin Media's 50Mbps service has somewhere in between 20,000 and 30,000 customers — Fogg said 20,000, James said it was more, but not more than 30,000 — which is not an awful lot, seeing as it was launched almost a year ago and is available to around 12 million people.
It seems that demand for such a premium service still needs a major boost, although this may of course be linked to the recession.