1. Oftel has a key role to play in ensuring that the UK leads the way in the evolving Information Society by adapting the regulatory framework so that it is appropriate for the development of vibrant competition and protecting customers' interests.
2. The convergence of telephony, broadcasting and information technology is posing new challenges for Oftel and other regulatory authorities. Last summer Oftel published a consultative document Beyond the Telephone, the Television and the PC on the regulatory issues posed by these converging services. This stimulated a wide-ranging debate and Oftel will be publishing a follow-up document this summer setting out the key issues and its proposals for further work.
3. Ensuring that customers get a good deal in the Information Society is central to Oftel's work. In December 1995 Oftel published its proposals for defining, funding and delivering affordable access to telecommunications under a revised Universal Service regime. Universal Service is based on the principles of universal geographic access, affordability and equal opportunities. Oftel's proposals for Universal Service, which had been the subject of two earlier public consultations, covered a level of service to ensure affordable access for all customers and arrangements for funding and delivering Universal Service across the industry which will not distort competition. Oftel's proposals included plans for upgrading the level of Universal Service as technology changes with the acceleration of the Information Society.
4. This document also contained Oftel's suggestions that similar principles might be applied to secure access to wideband or broadband networks at affordable rates for educational establishments or other public access points. This Statement sets out how Oftel plans to make its contribution to this widely accepted policy goal.
5. The convergence of telecommunications, broadcasting and information technology is likely to fundamentally change people's lives and the way society works. The development of the so-called Information Society has already began and will accelerate. As penetration of these new advanced services increases it will be important to ensure that a society of information 'haves' and 'have nots' does not develop. Oftel has therefore proposed that the level of Universal Service (affordable access to basic telecommunications services for all those reasonable requesting it regardless of where they live) needs to be a dynamic concept that is upgraded as technology develops. A process for reviewing and upgrading the level of universal service is needed to ensure that customers without access to new services are not placed at an unacceptable social and economic disadvantage. For the present, however, the Universal Service level has been set at "affordable access to basic voice telephony via a digital line" for all UK customers.
6. There is currently an intense amount of public and private sector activity testing out the application of advanced services using converging technology to assess their commercial potential and the social, educational and economic benefits that accrue.
7. At the European level in 1994 the Council agreed a general framework for action on the Information Society within the European Union. Following this eleven projects were launched in areas such as electronic libraries, education and training, health care and environmental and natural resources.
8. In the UK the Government has set up a ministerial group under the Deputy Prime Minister to identify and take forward significant cross-departmental initiatives to ensure that developments in information technology are exploited to the full in the national interest. Two major joint government and industry initiatives, the DTI's Information Society Initiative and the Education Departments' Superhighways Initiative, are already underway. The DTI's Information Society Initiative, launched in February 1996, is aimed at promoting the beneficial use and development of information and communications technologies for businesses, particularly small and medium sized companies. The Education Departments' Superhighways Initiative, launched in 1995, includes a pilot of 24 projects involving a variety of industry sponsors and education sectors to test out the potential of wideband and broadband technology to enrich the delivery and experience of education, to help young people meet the challenges they face when they enter employment and to provide them with the skills needed for lifelong learning.
9. Commercial companies, including many telecommunications companies, are actively involved in these Government initiatives as well as their own projects. For example, BT is undertaking a trial of interactive television, and Cambridge Cable's Cambridge On-line project involves terminals at six public access points (citizens advice bureaux, libraries, housing department) in the city.
10. In the higher education sector the SuperJANET pilot provides full broadband connections between some universities and medical institutions, and will demonstrate the potential capabilities of true broadband. In the public library and museums sectors the Library and Information Commission (LIC) is managing a feasibility study into the use of broadband networks between libraries, museums and schools and the most effective ways of utilising them.
11. Against this backdrop, Oftel suggested that it might be in the broader public interest for the education sector and public access points to receive access to a higher level of telecoms service to enable universal geographic and affordable access to wideband or broadband services.
12. Oftel received nearly 200 responses to its consultation document on Universal Service, of which over 160 specifically referred to its proposals regarding whether or not it was considered appropriate to offer certain public institutions a higher level of universal service. These included many responses from the educational community. In addition Oftel held an education workshop attended by around 100 educational and industry representatives to discuss the role of telecommunications in the education sector.
13. The overwhelming majority of consultees supported the concept of assisting educational and other public institutions gain access to "superhighway" services at affordable rates; and endorsed Oftel's role in stimulating public debate on this. But there were differences of opinion as to whether or not schools should be the focus for action and a lack of consensus that the Universal Service approach was an appropriate mechanism for funding this desirable policy.
14. Understandably consultees had different interests and were concerned that their needs were not overlooked. Consequently from within the education sector there was concern about focusing just on maintained schools for 5-16 years as the priority area for action. And consultees outside this sector argued that an equally convincing case could be made for public access points and possibly other community services.
15. Oftel still considers that it is necessary to look at priorities and educational establishments are an appropriate starting point given their vital role in skilling and equipping young people for the Information Society.
16. Another priority area identified from the responses is public access points, such as community centres, public libraries and adult education centres, to give wider access to "superhighway" services. In particular, Oftel considers that the National Consumer Council's* idea for multi-media kiosks available at community points deserves further consideration. The growth of lifelong learning with individuals seeking learning throughout their lives and outside institutional setting is likely to increase demand for this type of facility.
(* The Information Society: Getting it Right for Customers. NCC (1996))
17. Oftel has decided to pursue this separately from its work on Universal Service for the following reasons:
18. Oftel has concluded that it has been given widespread encouragement to take action. Educational establishments and public access points should be the top priorities for action by capitalising on existing local authority and educational structures which offer ease of dialogue and administration. However, formal Universal Service arrangements are not the appropriate mechanism.
19. Affordable access to wideband or broadband networks will not by itself equip educational establishments or public access points to take advantage of the information "superhighway". As already discussed there are a host of non-telecoms needs which have to be met as well. For example, schools and colleges need teacher training, internal wiring, hardware, software, technical support, educationally useful applications, and the development and dissemination of good teaching practice using these applications. Public access points, such as libraries, have a similar set of non-telecoms needs.
20. The work of the National Council for Educational Technology (NCET) and the experience gained from the Education Superhighways Pilot Projects should help develop appropriate applications and examples of good teaching practice in the education sector.
21. The Department of National Heritage (DNH) is working with public libraries and with museums and galleries to encourage the development of coherent and compatible IT systems within and between these sectors. The Library and Information Commission (LIC) has commissioned work to explore the feasibility of a national framework for the procurement of IT and supply of non-telecommunications services in libraries. Their feasibility study into the use of broadband networks between public libraries, museums and galleries should identify appropriate applications. The LIC and the Museums and Galleries Commission are developing IT strategies in their respective sectors and DNH is funding a project by the Museums Documentation Association into the needs of museums in the area of IT.
22. Leaving aside these broader needs, in terms of telecommunications the consultation exercise identified three broad requirements:
23. It is important that any telecommunications initiatives cater for all educational establishments and public access points including those in remote and rural areas so that there are no information 'have-nots'. The consultation elicited a strong response from those based in such areas who were concerned that the development of a wideband/broadband infrastructure in these locations would not be commercially viable if left to market forces alone. Yet such areas have potentially the most to gain from "superhighway" services giving them access to a wealth of information unlikely to be available locally; opening up the possibilities of remote teaching of specialist subjects; and enabling on-line learning and training that would otherwise involve expensive and time-consuming travel. Any initiatives should also cater for those with special needs.
24. The affordability and predictability of telecoms tariffs is an issue for public institutions such as educational establishments and public access points because they work to fixed and limited budgets. Several responses from schools and local education authorities stated that they were inhibited from using on-line services and the Internet because the extended or continual nature of these services meant large and unpredictable telephone bills.
25. Increased competition in the telecommunications market will bring prices down for all customers over time. However, there is need to stimulate the market to deliver affordable connection and usage tariffs for educational establishments and public access points now, to encourage these sectors to use on-line and Internet services that are already available, and to gain access to and use wideband or broadband services when they become available.
26. In terms of predictability BT has recently launched the "Education On-line" tariff which offers schools and colleges a flat subscription quarterly fee with no local call charges between 8am and 5pm Monday to Friday for access to educational on-line services. Although the objective of helping schools and colleges avoid unforseen bills is welcomed by Oftel, BT failed to address a number of Oftel's concerns prior to the launch of its tariff. In March Oftel issued a press notice setting out these concerns, in particular whether BT's handling of this tariff had advantaged its own educational on-line product - CampusWorld - to the disadvantage of products offered by competing service providers. Oftel is currently considering the responses to its press notice.
27. Educational establishments and public access points have different needs and different levels of exposure to information technology. Any telecommunications initiatives must therefore not be prescriptive blueprints but offer flexibility and choice in terms of:
Network operators - competition is essential to ensure that educational establishments get the best deal available and efficiency of provision.
Bandwidth - not a defined specification of technology but a flexible service with bandwidth at a variety of levels. Demand for higher bandwidth is likely to grow as educational establishments and public access points experience the benefits of access to on-line services. But many educational establishments and public access points have still not fully exploited the potential of on-line services and the Internet which are available over narrowband technology, and, as already mentioned, lack of affordable and predictable telecoms tariffs may be inhibiting this.
Service providers - to give access to the widest range and choice of services.
28. Oftel will encourage the telecommunications industry to adopt a responsible attitude to enable affordable access to advanced telecommunications services for all educational institutions and public access points. It will challenge the industry to demonstrate that regulation in this market segment is unnecessary by developing a collaborative approach which:
29. To assist with this the Director General is chairing a Task Force with the following representatives.
The Department for Education and Employment and the Department of National Heritage will be observers on the Task Force.
30. The Task Force will: