Tag Archives: Value

Seeing the Value – will the UK Public Accounts Committee make the connections?

28 Jun

WestminsterIn matters of broadband policy many folks would not normally rate the chances of UK Parliamentarians having sufficient awareness to probe government policy to any great depth but in July their Public Accounts Committee will have the benefit of the National Audit Office report on the delivery performance of the Department of Culture Media and Sport – the current policy owner for the UK’s most critical infrastructure development.

The committee can, of course, give witnesses a fully televised hard time for the benefit of the wider public but much will depend on the members’ ability to ask incisive questions.   In their deliberations over the state of broadband policy the PAC will also have the benefit of the Information Economy industry strategy recently launched by the Department for Business (the former owner of broadband infrastructure policy) and, of course, the brilliant independent review of Public Sector Information by Stephan Shakespeare

Hearings of the Public Accounts Committee of the UK Parliament seem an unlikely platform for articulation of radical policy ideas.  The PAC may be regarded as ‘influential’ but in practice government can ignore its reports and the committee has no direct vote on policy issues.  At its best they can capture and deliver views that are of common concern – views and sensitivities that any government might be foolish to dismiss –  and this is why the combination of the NAO, IE and PSI reports is now so powerful.

Centre-right policy across the entire economy is firmly grounded in a view of competitive market efficiency that is so often a misinterpretation of its roots in the USA.    It is true that radical approaches to infrastructure provision in the USA have been routinely opposed in the courts with intensive lobbying from established industry interests.  That however has not prevented 135 municipal FTTP access networks from being deployed and is not deterring many others now in the throes of feasibility studies.  Indeed their regulator, the FCC, is actively encouraging the growth of new entrants to deliver local ‘future-proofed’ Gigabit networks – often in conjunction with local municipal Energy companies.

The reason for this municipal non-conformist economic behaviour is quite simple.  These cities and communities need jobs and economic growth – and someone has rumbled that the global market for the expertise that is engendered is not just huge; it is vastly greater than the growth prospects of an industry dedicated to limiting its own long-term growth in the interests of short-term market gains and value extraction from an outdated analogue infrastructure.

On the other side of the Atlantic the policy view of connectivity is analogous to their recently reframed position on Climate Change.  After years of resistance, after listening attentively to oil and gas lobbyists, realisation has finally dawned that the global market for sustainable energy is real, that climate change is real, and there’s an urgent need to gain qualifying experience if the opportunities are not to be missed.

Which is exactly the point made in the UK’s Information Economy industry strategy.  ‘UK Trade & Industry’ now understands that the global market for smart city management systems is worth around £400bn by 2020 and, if UK firms are to stand any chance of gaining a modest 10% market share, there’s an urgent need to have some sort of credible  qualifying experience.  So far only one UK city has made any real attempt to deploy an ultra-fast city network and, in a classically defensive and litigious response, BT and Virgin Media have opposed that initiative

The PAC may perhaps wonder why the Connected Cities programme is so lacking aspiration and urgency that the public funding is almost entirely ending up with established interests who are not keen to see citizens and enterprise provided with future-proofed fibre access networks.  They might argue the point from the view of Health, Energy, Transport, Environment, Education, Social Services or any departmental position that is now critically dependent on a fully connected digital economy.

They might even question the oddly antique view that the Information Economy is some small but growing sub-sector of UK industry – some clever clogs that do strange digital things – rather than the primary focus for revitalisation and rebalancing across the entire economy.

And, while they are rightly focused on public expenditure they might wonder about value for money for expensive public sector networks paid for by the public purse but not, it seems, allowed to be used for the benefit of citizens.

The digital penny may perhaps have dropped in a corner of the Department for Business Innovation and Skills but it is surely the Treasury that needs to understand the risks and true cost to an economy that cannot afford to prop up relics of the past.

_______

Related Links.

Searching for the Centre of the Digital Universe

Economic Revitalisation

Advertisements

‘Value & Worth’: Irene Ng’s new book

23 Dec

For Irene Ng’s new book the title of our review, ‘Make of it what you will’, captures the sense of empowerment that is so evident in the digital economy.

This is an economy where the consumer plays a huge role in how products and services are used to create value.  It is an economy where suppliers must rethink their propositions.

In our increasingly digitally-enabled economy it is no longer sufficient for businesses to see sales of a product or service as their sole objective.  The value seen by the consumer will be co-created in combination with an array of services and digital devices and further conditioned by the context in which they are being used.

The author does not hide her academic credentials (including a Professorial Chair at Warwick University) but it is her pre-academic business experience that is evident throughout.  The challenges of creating and sustaining new markets will be fought in an intensely competitive arena – and one where the platforms for value co-creation are often beyond the influence of second-order supplicants.

Many business leaders will respond to these challenges with innovative creativity and startling success.  This week’s report from the GDS shows very clearly that the government is taking a lead.  Others may not be so responsive.  The world will move on and the disruption to the established order of things will be devastating for those who do not see or fully understand the changes that are already upon us.

This an explorer’s handbook as we venture into the digital unknown.

More at the Sunday Breakfast Book Review

See also our Business Advisory note at Bdaily – the UK business news network