Chairman's welcome to CMA conference

31 May 2012, Michael Rowbory

At our annual conference we had a large amount of interest, which shows how all of us, as business users of ICT - by this I mean - internet, communications and technology - recognise the impact on our work of huge changes.

Huge changes specifically in mobility, in the cloud, in e-commerce, and in the consumerisation of IT.

These changes are significantly transforming the way the UK does business. It is important that CMA, as the premier, independent ICT organisation representing business users, facilitates the exchange of ideas and helps to develop good practice in corporate, business and public ICT.

At a higher level, we also seek to influence the formation and implementation of information society policy. At the heart of our activities is our focus on 'enabling the online economy,' which itself is underpinned by what is increasingly being referred to as - the intelligent business web.

Identifying how we, as an organisation for business ICT users and professionals, can exploit the rapid developments brought on by these fundamental changes has made the past year a busy one for the CMA leadership.

I would just highlight a few of our activities:

  • First of all Carolyn Kimber, our Chairman for the past four years, is now the Olympic Champion for UK Trade and Investment ICT sector. The objective of this high-profile group is to maximise the Olympic legacy for UK plc. Through her work the CMA has become a recognised supporter of the project.
  • We are, again through Carolyn, involved in the Nominet.UK Policy Committee representing business users interests in the domain name environment.
  • We have also been invited to work with the Communications Consumer User panel, which until now was very citizen-consumer oriented.

This is a reflection of our unremitting pressure on the regulator and on government to recognise that the business user, of all shapes and sizes, has problems that are worthy of the same degree of attention as is given to the issues facing the citizen-consumer.

Indeed, we await, along with everyone else, for a clear indication that the forthcoming Green Paper will propose that any new Communications Act will correct this long-standing anomaly.

As I said by far the most important area of our work has been in addressing changes in ICT as they impact business users. As ICT professionals and business users we know we are living in interesting times.

Just as one example, the recent IPO of Facebook has become something of a milestone in the development of our information society - in the development of social media. Whether this is for good or bad remains to be seen.

Today, many of us, as individuals, have adjusted our social lives to make the best use of the online networking tools that have been made available to us.

Businesses are undergoing that same process.

  • a fully networked business environment means better access to customers and suppliers;
  • a fully networked business environment results in more competitive pricing, greater flexibility and less capital tied up in inventory;
  • a fully networked business environment provides the opportunity for a game-changing surge in innovation and productivity and a big leap forward in job creation and new growth opportunities.

The intelligent business web, which exploits such huge changes is of fundamental importance to small and medium sized businesses. These businesses, as we all know, are vital to our national economic recovery. And this is why CMA has begun to work more closely with organisations such as the Federation of Small Businesses, the FSB.

This leads me to the very important and successful 2011 CMA Internet Opportunity Survey led by Julian Harriott and published in October last year.

The survey, supported strongly by the FSB, and sponsored by DCMS and OpenReach, suggested that innovation and the development of the business intelligent web are being significantly hampered by uncertainty about super fast broadband availability.

There is widespread lack of knowledge in the business community, especially among smaller businesses, of what current generation and superfast broadband can do for their enterprise.

When presenting the results at a House of Commons gathering in November we expressed our concern that, in general, UK enterprises are not taking as much advantage as they might, of the benefits that next generation broadband can deliver.

In so doing they are failing to adopt and exploit innovative solutions. The implication is that UK-based businesses will be disadvantaged in competing with other EU businesses as the single digital market develops.

Relatively few UK businesses are currently initiating their own ICT transformation programmes. We are not yet seeing sufficiently radical transformation in how technology and its derivatives are deployed in businesses and government organisations.

The result is that UK plc is not reaping the full benefits of change, UK plc is not putting in place those changes that elsewhere are generating more efficiency, more innovation, and more value.

We noted in the report that business demand for superfast broadband is rising more slowly than is desirable from the viewpoint of investment and innovation.

However, the private sector alone cannot be relied on, relied on either to effectively improve awareness, or relied on to supply universal access to broadband in a timescale that will ensure that our country keeps pace with international competitive benchmarks.

There is also a deep-seated and widespread belief that neither government nor regulator are doing enough to complement and support the efforts being made by the private sector.

Ministers rank broadband as one of Britain's top four infrastructure priorities, alongside roads, rail and energy. George Osborne has committed £200bn to these sectors over the next five years. But a tiny fraction of that will go to broadband, just £1.3bn from local and central government has been earmarked.

To put this in context with our international competitors, if the UK had committed as much as the Chinese have done, per head of population, some £7bn of taxpayer funds would be invested.

Australia is pushing fibre to 93 per cent of homes by 2018.

In the UK, a nationwide fibre-to-the-home programme would, by some hotly disputed estimates, cost up to £29bn.

We recognise that UK is in a difficult national financial position and there are many strident calls on the public purse.

But we in the CMA have a concern that to support economic growth there needs to be a more effective and more integrated policy.

Summarising our position on all these issues:

  • We have increasing concerns about the UK's information society policy. We look askance at the policy vacuum in government and the lack of clear regulatory vision, depressed by cynical threats of legal action at every turn.
  • We are concerned that Ofcom's relationship with government is reduced to an advisory role and consequently the regulator, well able in the past to implement such major benefits to consumers as the functional separation of BT, now appears to lack the will and the resources to attack the increasing complexities of on-line business.
  • At the top of the tree the pool of experienced government officials who can assist in the development of policy has been reduced to a small cadre of vastly overworked officials who are barely able to keep up with current events, never mind plan for the future.
  • We see competition increasingly limited, regulation in a cul-de-sac and lack of a coherent long term strategy for the fibre era. The fibre architecture currently being deployed is more friendly to shareholder interests of the suppliers than it is to the future needs of the business and citizen customer - and hence of the nation.
  • Public funding for broadband is fragmented between DCMS, DEFRA, BIS and other departments. It lacks coordination.
  • Initiatives are not integrated with other policies and plans: high-speed cities, cash for mobile not-spots, BDUK framework, National Infrastructure Plan, Critical infrastructure protection, Smart Grids and Smart Metering, development of European e-commerce and so on.

We recognise that there are huge difficulties and CMA is proposing a number of practical initiatives to assist in shaping an effective information society policy.

So expanding on the good work of our college of regulatory practitioners we are examining the feasibility of establishing a CMA-led initiative for Information Society Policy through the creation of a Think Tank. We are now drafting our first thought piece and we are in the process of approaching a number of influential and independent experts who are well able to contribute to such policy documents in the coming months. As the proposition and structure firms up we will brief members on progress.

In support of this headline activity we are setting up three expert colleges covering practical issues of telecoms and broadband, mobility, e-Commerce and cloud services. We will draw on CMA and BCS members so that we can provide more effective advice and networking opportunities for business users as well as provide input to the policy debate.

This conference will I know provide a lot of food for thought for you. I hope that the day will encourage you, if you feel as strongly as I and the CMA Board do about the future development of Information Society Policy for Business in the UK, to join with us and contribute to CMA initiatives:

In short we are seeking to deliver more efficiency, more innovation and more value to UK online business.

We are doing exciting and important work in the midst of an exciting and important industry. So here's my invitation. Contact me and let me know how you can best contribute to CMA.

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