UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 305-i

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

WELSH AFFAIRS COMMITTEE

DIGITAL INCLUSION IN WALES

Tuesday 3 March 2009

DR NEIL SELWYN and DR BEN ANDERSON

MR RHODRI WILLIAMS, MR ROBIN BLAKE and MR HYWEL WILIAM

Evidence heard in Public Questions 1 - 46

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Welsh Affairs Committee

on Tuesday 3 March 2009

Members present

Dr Hywel Francis, in the Chair

Mrs Siān C James

Mr David Jones

Hywel Williams

Mark Williams

________________

Memoranda submitted by Dr Neil Selwyn and Dr Ben Anderson

Examination of Witnesses

Witnesses: Dr Neil Selwyn, London Institute of Education and Dr Ben Anderson, Essex University, gave evidence.

Q1 Chairman: Good morning and welcome to the select committee and its inquiry on Digital Inclusion in Wales. Could I invite you to introduce yourselves for the record, please?

Dr Anderson: Ben Anderson from the University of Essex.

Dr Selwyn: Neil Selwyn from the Institute of Education at the University of London.

Q2 Hywel Williams: What data is available about the extent and nature of digital exclusion in Wales?

Dr Anderson: It appears to have changed over time, which you may have seen from the submission that I made. Certainly the indicators of social exclusion have changed over time in Wales - digital exclusion as well. To give you an example of internet access in the household, looking at the data we have got going back to 2001/2002, the employment status of household heads made no difference at all to whether or not they had internet access in 2001/2002, nor in 2006, and yet in London it does. That is an example of how the social characteristics can actually have different effects on whether or not people are likely to have internet access for very different reasons in different parts of the country. As you may have seen from the maps that I gave you, there are obviously huge variations, even within constituency areas and local authority areas where you might expect there to be higher internet access, for example, leaving out all of the other technologies we might talk about. It seems, from the data at least, that over time parts of Wales have caught up with others; so, in other words, it is now more equal than it was; but clearly there are still areas where internet access or mobile phone penetration or digital television penetration are not as high as other areas.

Q3 Hywel Williams: Is this geography, class or income?

Dr Anderson: All of those mixed together in different ways and, unfortunately, in quite complicated ways; because you have, for example, got the infrastructure issues - so cable company coverage in urban areas set against broadband of different kinds, and presumably in the future increasingly different kinds. Not only do you have those social demographic things, you have got the infrastructure side of it but then you have simply got attitudes and values; and the same social characteristics in one place may have a very high value placed on internet access and in another they may not for reasons that are very, very difficult to get at and very qualitative.

Q4 Mrs James: I just want to expand on this theme a little bit. What barriers do you see to digital inclusion which are particularly relevant in Wales - the particular barriers in Wales?

Dr Selwyn: Just to follow on from what Dr Anderson was saying about attitudes and values. We carried out a research project in six communities in Wales and six communities in England that were comparable, and we were looking at: why people did or did not use technology, particularly internet computers; how they develop skills and know-how. We found, as Ben says, a very complex set of factors that influence people's engagement with technology and there were not necessarily differences between England and Wales; there were differences between the communities. When we are looking at the Valleys communities in Nantyglo, for example, the differences were very different in terms of Beaufort. It was very difficult to understand whether this was a factor of location, area or locality, or whether it was due to the individual. We found the usual variables which are associated with social inclusion such as: class; economic background; and age, and were all very, very important. In terms of Wales in particular I would say geography; topography in terms of the coverage of wireless and wired connections; and rurality as well, and the fact we have got isolated rural communities that we looked at; there are more of them in Wales than there are in England, so those factors are very, very important; and also, of course, language in particular areas. The relevance of content to people was very, very important. They had to have content which was relevant to what they were interested in and their needs. Obviously for first language speakers you need to have Welsh language content.

Q5 Mrs James: That is quite interesting. We know there is a direct link to social inclusion and things like background, poor health et cetera, but you have picked up on topography as a particular area. Could there possibly be a link between the fact that it is difficult to digitalise Wales because of that topography; and who is picking up the bill and the end of the day; and who is responsible for that?

Dr Selwyn: Yes, we were particularly interested in how individuals experienced technology; and so topography was very important, as I said, for the Valleys communities. If a public access point is in another valley, it is actually very difficult to get from one to the other as you know, even though it is only five miles apart. So at the individual level I think it is very important; and obviously in terms of the industry level, topography is a big issue in terms of expanding the reach of networks.

Dr Anderson: Economically speaking there is only so much you can do. You have an S-curve, if you like, and at some point you are going to get into this thin bit and it is not going to change much no matter what you do, particularly changing the cost infrastructure. What does it cost to be digitally included obviously depends on what you mean by: what channels are you interested in; is it little mobile devices for £150 that delivers government services; is it a mobile phone; will that do; or are you talking about something very different. In terms of barriers, in a way you run out of levers - or you will run out of political levers - social policy levers, if you like, and you are simply left with the ones which are going to be increasingly more difficult to overcome. At that point I think we have to weigh up the cost benefits particularly when you are wondering who is actually going to pushing the levers and the buttons.

Q6 Mrs James: Are there any specific ways that digitally excluded people in Wales are losing out? Is there anything you could put your finger on?

Dr Anderson: I do not have any evidence about that particularly, no.

Dr Selwyn: No more than people losing out in England. Our evidence was that, as I said, it was not a country thing; it was much to do with local communities and individuals.

Q7 Hywel Williams: Could I just pursue that point for a moment. Dr Selwyn, you said that language was one of the issues. Can I invite you to expand on anything you might know about that? Can I also just preface that by saying there is a place called Penryndathrys(?) just outside my constituency where, in the early 1990s, there was an earlier scheme there which was through the medium of Welsh, which meant that a large proportion of the village were on broadband and were actually provided with computers as well at a very advantageous price; but one of the reasons I suspect was because the service was in Welsh.

Dr Selwyn: As I said, from the research we have done with low-using and non-using individuals, it is the idea of content of services which are relevant to them, rather than relevant to the organisations which are trying to work with them. In particular, we have found that where people could access information and services that were tacked into their hobbies, leisure interests or their background then they were much more likely to engage. Obviously if you think about communities where Welsh first language speakers reside more often, then that is a crucial thing. We had the thing with Microsoft and the spellchecker in Welsh years ago and Word was suddenly accessible to different groups. In the research I carried out we did a household survey for a 1,001 people in southeast Wales and the west of England to try and compare the two communities: Welsh language did not come up as a big issue at all. We had one or two people who wanted to fill the survey in in Welsh and actually have the interview in Welsh, but other than that the Welsh language did not come up. I think, as you have said, it is different areas of Wales that perhaps were not covered by our survey.

Q8 Hywel Williams: Are there any studies specifically of introducing a service in another language, not necessarily Welsh, and then having measurable effects on take-up or use?

Dr Selwyn: Not to my knowledge.

Dr Anderson: I am just doing some work with British Columbia at the moment where they are rolling out broadband to some of the native communities and they are seeing early indications at least that the provision of local cultural content (and it is not done by federal government or anybody like that; it is done by the communities themselves as part of a skilling process) is having quite a significant effect on at least self-perceptions of cohesion within those communities. That is not to say that it actually has a miserable social outcome, other than we know those sorts of self-perception do lead to positive social engagement over time. Obviously there is an historical issue there - that may well be the case with Wales, I do not know that case as effectively - but certainly with respect to engaging those cultural communities in a way that makes them feel far less socially, economically and politically isolated than they have been, it does appear to be making a difference. That is not naturally to do with broadband; it is actually what you doing with it.

Q9 Hywel Williams: It is the content. Just to sum up, therefore, apart from providing the equipment and the networks, what else is necessary to ensure that everyone can benefit from digital technology? You have already answered some of that, I think.

Dr Anderson: Attitudes; skills; motivations. If it does not serve a purpose then by and large people will not bother with it. Why would they?

Dr Selwyn: Just to follow on from that as well. When we talk about "access", it is access to the technical hardware, access to the software and the connectivity; but above and beyond that, particularly from the research we have done in the communities, was the need for technical support, but also social support as well. Particularly with lower users, we found if they were able to talk to other people about using technology, whether they could call upon what we call upon "disinterested" sources of support, rather than "interested" sources of support, then they were much more likely to engage with technology on a sustained basis. One of the challenges to policymakers is: is it possible to boost social capital in that way; is it possible to work with these informal community networks? That is a difficult question to answer.

Q10 Hywel Williams: Can I ask you therefore: what, in your view, are the strengths and weaknesses of the Government's Digital Inclusion Action Plan? Briefly!

Dr Anderson: I was very pleased to see (and this follows directly from what Neil just said) the focus on looking at grassroots initiatives; so accepting that top-down large-scale interventions have their very limited lifetime which is to do with funding, for example, and sustainability issues - particularly when it is not engaging with the needs of the local communities. If you look at places like Alston Cybermoor, which is trying to do fibre as well, they exist on a kind of knife-edge financial basis, but they are meeting the local community's needs and they are very effective at doing that. Engaging with those kinds of groups and giving them that kind of seed support to keep them going, keep them sustainable, I think is probably one of the strongest things that comes out of the Action Plan. I would suggest, a kind of middle ground is the online centres and to what extent they are making a difference; and we should really take a good hard look at what benefits they are delivering for the costs they are incurring; because I am not clear that we have any particularly good evidence on that. On the weaker side, the ideas around simply throwing technology into schools or into children's homes, with no real clear idea of exactly what that will do compared to some other investment, I think that is quite a weakness.

Q11 Mr Jones: Is the proposed role for Government in the Action Plan appropriate, or should it be trying to do more; or would you prefer it were doing less?

Dr Selwyn: I think the Action Plan was very pleasing in a way inasmuch as, as I read it anything, it highlighted the need to be confident about what Government's limitations are. Government can do so much but then you should be happy with the fact there is stuff you cannot do. In terms of providing basic access and technological infrastructure and regulating the market, I think that is a very sensible thing to be trying to do. Acting as a cheerleader for digital inclusion - the idea of digital inclusion champions - I think was pleasing. However, as we found out in the past, that has to be sustainable, it has to be supported, and there has to be real clout behind any organisation like that. As I said, the idea of working with industry, working with the voluntary sector and the third sector, I was pleased to see that. You do not always see that in Government reports. From one perspective, yes, you could say it is an accurate description of what Government should be doing; however, I would recommend not trying to do too much. When you talk about Wales, the role of the Assembly and the role of the UK Government needs to be thought through quite carefully.

Q12 Mr Jones: Can you expand on that?

Dr Selwyn: One argument could be, for example, that you need a digital inclusion champion for Wales. It is no use having a digital inclusion champion for the UK. When you look at one of the annex reports which looks at other countries' strategies, as soon as countries such as Austria, for example, get into federal government it complicates the matter. I think there is an argument to be made for having one digital inclusion champion for the whole of Britain but whether that is possible or not, I am not sure.

Q13 Mr Jones: That is your preference?

Dr Selwyn: That would be my preference, yes. One body which has a kind of remit and clear remit and is supported is far better than diluting the cheerleader.

Q14 Mr Jones: On the basis as you have just said, I take it, that the problem of inclusion may be different in different parts of Britain but essentially it is the same problem?

Dr Selwyn: Absolutely, yes.

Q15 Mr Jones: Is there any evidence that interventions to promote digital inclusion can actually achieve results? If so, what would you say is the most effective form of intervention?

Dr Selwyn: I think one of the recurring themes from the literature is that it is very difficult to pinpoint any outcome. In some ways, one of the conclusions which comes from the academic research is that we should not be trying to fix targets and indicators to such interventions. It is very difficult, for example, if you look at the role of UK online centres, and LearnDirect centres, to show that there is any tangible difference in educational outcome. A lot of that will come from the way that we measure educational outcome. We are driven in many ways by the indicators we have got. If our measure of educational outcome is increasing qualifications, or GCSEs, whatever we choose to do, it is very difficult to pinpoint the role of technology or the role of intervention in causing those differences. There is very little conclusive evidence, I would say, of the difference.

Dr Anderson: I would go along with that, but it has to be said it is almost an absence of evidence rather than evidence that there is nothing happening. There have been very few interventions that have actually looked over some substantial period of time and we conducted a review a couple of years ago; and many of them were trying to do impact assessments six months after the schemes had started, when you need to be looking at it two, three or four years down the line. The evidence for supporting which ones work best is very sketchy; however, what we did find was that some of the grassroots initiatives - which by their very nature assess their own effectiveness, because they have to, because they need to keep going - they generate the evidence that there is for their own being and so you have to take a little bit of caution.

Q16 Mr Jones: Is that not the strength of the internet in any event? It may be described as "anarchic" but it ultimately empowers people to strike their own courses and to develop things they are particularly interested in and expand on them? I wonder whether, for example, Facebook could ever have been the result of intervention?

Dr Anderson: It has an interestingly organic growth model, and also the open growth model which enables people to put their own applications and services on it, which the old closed garden view of internet access, particularly in interventions for example, was always bound to fail because of that. Possibly. In a way then you are debating what the place of government versus the market is in providing these kinds of social services, if you like. I think it is a very difficult question.

Q17 Mark Williams: You rounded off your submission to us by those four entitlements which reading are very general but fundamental to the way ahead. How proactive a role would you like to see Government taking in providing those entitlements? You have talked about a "bottom-up approach" to it, but there are certain structural things that follow from those entitlements.

Dr Selwyn: In terms of the entitlement, the first one in terms of "all individuals are able to exercise an empowered and informed choice about their use or non-use of ICT", the factors behind that are very, very complex. One of the things I was trying to argue in this report was that Government can obviously address entitlement four: "All individuals have ready access to a full range of ICT hardware and software", that is more the technological provision. The other ones come from that use, but also come from, as we said, things like social capital, working with local communities, and it is often on an individual level. One of the recommendations we were making from this work was that Government should not allow digital inclusion to allow you to take your eye off the ball from social inclusion. A lot of entitlements one, two and three come from the work that is just targeting social inclusion in general: stronger communities, better relationships, levels of education, levels of literacy, for example. You are not going to be able to use the internet very effectively unless you have a working level of literacy. In that respect Government can carry on addressing the wider issue of social inclusion and, hopefully, the rest will follow - but it will not unless there is the technological infrastructure.

Q18 Hywel Williams: Can I just ask about the literacy question. Is there a read across, say, in Government policy between this particular aspect? The people who are interested in promoting literacy, do they talk to each other?

Dr Selwyn: Yes. Digital literacy is one of the buzz words both in policy and in academia and it works on two levels: obviously there are literacies which are directly relevant to using a piece of technology - mobile phone or computer - but they are fundamentally underpinned by working literacy, the ability to read, write and be numerate. The strategies in education, for example, have ICT as a third plank: reading, writing and technology. The danger is that we focus on people's inability to use technology just as a technical skill, and we forget about the working literacy behind it.

Q19 Hywel Williams: Do you have any knowledge of any initiatives which impress the differential literacy amongst some language groups. I will give you an explanation because, although lots of people speak Welsh, a smaller number, say a third, are able to read, and yet another smaller number are able to write. I assume that that might have some fundamental influence on the use of any content really?

Dr Selwyn: We did a study for ACEN the Welsh language learning organisation. We were looking at who was using their resources. This was back in 2001, I think, and we actually found that the people who were using the resources tended to be spread all around the world: North American Welsh language learners; people in Guatemala who wanted just to learn a fifth language; and we did not find so many people in Wales learning to speak Welsh, which was quite disappointing. That is the only piece of research which I have done personally in that area.

Q20 Mr Jones: You mentioned the expression "digital literacy" and that, I guess, is different from "literacy" as it is generally understood. For example, it would take some while for someone who had no acquaintance with the internet, even though he could read a page on a computer screen, to understand that an "underline" means you press on that and the link will take you to a different page?

Dr Selwyn: Absolutely.

Q21 Mr Jones: That is something I guess that can be taught, but again to a large extent it is something that only develops with use?

Dr Selwyn: Absolutely.

Q22 Mr Jones: In other words, it takes some time, you read a page several times, before you realise that if you click on that highlighted link you will go to another page?

Dr Selwyn: Yes.

Q23 Mr Jones: Again, you learn that differently from traditional literacy. To a large extent you have to learn that by use?

Dr Selwyn: Yes, indeed. Lots of IT skills, particularly with the qualitative work, is that people just pick it up "sitting by Nellie". In the workplace, for example, you would literally learn from what someone is doing rather than being taught it. IT skills often are caught and not taught in that way. I think the point you are making also highlights the fact that digital inclusion is not exactly the same as social inclusion. You could have a high level educational background, you could be highly literate, you could have high income and still be digitally excluded. Again, that was one of the points we were trying to make.

Q24 Mr Jones: So it is not necessarily associated with poverty?

Dr Selwyn: It is not necessarily associated with poverty.

Q25 Mr Jones: Or low academic attainment?

Dr Selwyn: No. I think there are two groups: there are the socially excluded who are also digitally excluded; then you have also got a group of people above and beyond that. Particular work we did highlighted the importance of age and stage, and so we interviewed lots of retired people who had had very high-powered jobs but as soon as they had left the workplace stopped using the internet because it was a work thing. Again, the challenge is: how do we re-engage or do we have to re-engage people?

Q26 Mrs James: I am quite interested in that - the sheer content that people are accessing - because we have an interesting phenomenon in Swansea where we have an ability to get people from very socially deprived backgrounds onto broadband through a pay-to-view system: 3,500 people have actually taken up that option. I have been trying to find out from the company that has been doing that work what reasons people have chosen that option, apart from things like children's homework and needing to do research at home. Do we have any experience, because I am on broadband but I do not use it for work purposes at home - it is purely there as something to spend time on with my grandchildren, to play games on. I am quite interested in why people want to get on broadband when they make that choice. Do you have anything at all on that?

Dr Anderson: Certainly some of the stuff that is coming of a study from Canada is looking particularly at access to health information and the feeling of empowerment that goes with that. You said pay-to-view, so what charging mechanism is it?

Q27 Mrs James: It is a system where people can get white goods through paying for a television and a number of their customers actually choose to take up the broadband, get a computer, printer and then broadband. That is 3,500 people from quite socially challenged backgrounds. They are saying it is too early yet because they have not reached this three year mark with it, and they are going to be monitoring that quite clearly.

Dr Anderson: Another aspect that we have seen is use for leisure entertainment, in the same way as satellite and cable TV, because it is a cheap form of entertainment and leisure compared to the cinema, for example, with the additional childcare costs if you need a babysitter and so on and so forth. This is classic, and you have seen this over the last 30-40 years, of providing your own education and leisure at a lower cost through technology of various kinds.

Q28 Mrs James: It is just proving really that there are a lot of different reasons, not just learning?

Dr Selwyn: With informal learning a lot of people will use technology for informal learning but that is completely different from what we mean by formal learning; and it is often incredibly difficult to measure and incredibly difficult to actually gain any evidence of; but if you talk to people it is there.

Chairman: Thank you very much for your evidence this morning. Thank you, Dr Anderson, for your earlier memorandum. If you feel there are any points which we have not covered in the questions this morning we would be very pleased to hear from you. Thank you very much.

Memorandum submitted by Ofcom

Examination of Witnesses

Witnesses: Mr Rhodri Williams, Director, Ofcom, Wales, Mr Robin Blake, Head of Media Literacy, Ofcom, and Mr Hywel Wiliam, Head of Broadcasting and Telecommunications, Ofcom, Wales, gave evidence.

Q29 Chairman: Good morning. Bora da. For the record, could you introduce yourselves, please.

Mr Blake: I am Robin Blake, Head of Media Literacy at Ofcom.

Mr Williams: Rhodri Williams, Ofcom's Director for Wales.

Mr Wiliam: Hywel Wiliam, Head of Broadcasting and Telecommunications for Wales.

Q30 Hywel Williams: Good morning. Bora da. Can I ask you about the technology infrastructure to start with. To what extent is the lack of technology infrastructure an issue for disadvantaged groups in Wales, such as people who live in rural areas or who are socially isolated or economically disadvantaged?

Mr Williams: Generally speaking, the availability of digital technologies - and I am including there everything from mobile telephone reception, broadband, digital radio, digital television, any kind of digital service of that kind - is affected clearly by the topography and the fact that there are in Wales more rural communities than in many parts of the United Kingdom. That also of course is something that is affected by network economics because basically the challenge to many operators - and we see this in some of the areas for which Ofcom is concerned - whereby the cost of rolling out to, let us say, 90-95% of the population of the UK is relatively low but to get to that small percentage, it is a small number but if you are a member of that group it is very important, but the cost of getting services to that small group (and it does not matter which of these services we are talking about) can be quite substantial. That is why, in general, there are very few digital services that would be available to 100% of the UK's population. Even analogue television is only available to 98.5% of the population. We clearly have issues in Wales in various areas that we can probably come to later on, where this availability in that last 5%, 3% or even less sometimes is an issue, because it means that people who are affected by that have possibly a failure to access communication services, entertainment services, or services that are important in delivering health, education and other matters which are of importance to people as citizens. As more and more government services, for instance, go on-line, if you do not have adequate access to on-line services, then you are disadvantaged.

Q31 Hywel Williams: Does Ofcom have information about the nature or common characteristics of the ones who are the 5%? Is it just rurality or is it income? What is it?

Mr Williams: Usually in terms of the availability of a service then income is not a barrier there; that is more a question of affecting the take-up of services and something perhaps we will move onto later. In terms of the availability, that is a question more to do with the geography. Almost exclusively it is rural areas, sparsely populated areas, where people are a long way away from a BT telephone exchange, a main television transmitter, a relay television transmitter, a radio transmitter. It is the distance from the point of distribution that is the cause of the non-availability of the service. There are - and this is prevalent, I think, in the broadband area - some cases where you have that failure in very urban areas. There are areas of Cardiff, for instance, which have difficulty accessing broadband on account of the fact that there is aluminium used in the network, not copper as is more common in BT's network as a whole. It is not exclusively rural, but I would say it is predominantly rural.

Mr Wiliam: It is worth adding as well, a very obvious point in Wales, that the mountainous nature of the terrain can be an additional issue, for example, for the availability of broadcast services, typically so. For example, although the Welsh population is about 5% of that of the UK, we have about 20% of the UK's television relay transmitters and these are little transmitters that help the main transmitters get into communities that are shielded by mountainous areas.

Mr Williams: One thing we have tried to do since Ofcom took up its responsibilities very late in 2003 is to publish on an annual basis a compendium of information that is available on this. We have tried to include what we thought were the relevant parts in our written evidence, but that is updated on an annual basis in the Communications Market Report for Wales.

Q32 Hywel Williams: Could I just ask perhaps a parochial question, but who is responsible for providing TV relays? I am thinking of a north-east facing row of town houses in my constituency where there used to be a relay but apparently it is no longer there?

Mr Wiliam: Historically it was the broadcasters through investment directed by government of the time; but there was a relay building programme that finished somewhere in the mid-90s now where they had got down to the point where they were serving round about 200 or so viewers and below that level it was deemed uneconomic to continue to build relays. In addition in Wales there are small pockets of self-help schemes as well, where communities have got together to effectively build their own receiving antenna or possibly a relay in certain circumstances.

Q33 Mark Williams: Turning specifically now to broadband and with regard to the Digital Britain proposal to develop a Universal Service Commitment for broadband by 2012. We have talked about topography - I appreciate that - but what other difficulties do you foresee in rolling out that proposal and how can those difficulties be overcome? We heard the evidence earlier of Dr Selwyn who talked about "entitlements": how do we reconcile that with network economics - because, representing a rural constituency, you will appreciate that issue comes up frequently - not just to domestic customers but particularly to small businesses? How are we going to overcome some of the challengers of network economics in rolling out that Universal Service Commitment?

Mr Williams: I think what is new and what is to be welcomed in the Digital Britain report is the fact that, generally speaking up until now, broadband has been seen as something which is delivered almost exclusively by copper wires in areas that do not have access to Virgin Media's fibre-optic network. In Wales that only covers really an area between Newport and Swansea; and it does not cover the whole of the area at all. Most people are dependent on copper wire to get broadband via ADSL technology. I think the first thing the Digital Britain report sets out is that in order to achieve the Universal Service Commitment that they talk about a multi-platform approach would be necessary; that it will not inevitably lead to everybody having broadband via the same technology; some will be able to access it by mobile broadband of the kind currently provided by mobile telephone operators; in other cases satellite might be necessary; or there are what I would describe as "emerging" technologies - YMAX being the most well known - which would again provide wireless broadband in rural areas. There are some parts of Wales where people on a small community level are experimenting with these; but I think part of the problem is that it has been confined to a small number of areas. What the Digital Britain proposal brings into play is the possibility that the industry will fund the provision of these kinds of services going forward. There is not great detail there on it but there is mention that the industry will come together to provide this service in the same way currently as BT funds the Universal Service obligation in narrow band fixed line telephony. There will still be problems; it is not an easy one; it is not one swish of the wand and suddenly everybody gets broadband. There will still be areas and small pockets that are difficult to get to; but hopefully before the digital proposals get implement phase 2 of the Welsh Assembly Government's RIBS programme will have targeted more communities where there are currently problems, so that the numbers will be even smaller. By 2012 it should be possible to deliver up to 2Mbps [megabits per second] of a broadband service to everyone in Wales.

Q34 Mark Williams: Is that 2012 if you call it a target a realistic one? I appreciate the work the Assembly has done and it is moving in the right direction, but hoisting people's expectations, and rural areas and rural businesses' expectations have definitely been hoisted up now, how realistic is that?

Mr Williams: I am not an engineer but I think what I would say is that with the will of Government and the cooperation of the sector - because there are some changes, for instance, in the detailed operation of the licensing arrangements of mobile telephone companies that will have a profound effect on this - the 2G liberalisation programme would allow the mobile operators to have a greater rollout of their 3G services, which are essential if mobile telephony is to play a part in this process. Alongside the Digital Britain team, the Government, we are doing what we can to ensure that those changes take place. I think the will is there. With the cooperation of the industry, Government, and ourselves as the regulator I think it is a realistic target.

Q35 Mr Jones: There has, as you know, been some criticism that the 2Mbps target is really rather unambitious. What would you have to say about that?

Mr Williams: I think it depends from where you are looking at it. If I can use personal experience here: I live in a part of Cardiff that will shortly have access to what is described as "superfast broadband"; not only will I have access to it, I will actually have a choice of two providers: I will be able to get it either from Virgin Media, or from BT or indeed in time from other people who have access to BT's exchange. That will give me access of 40-50Mpbs. Compared to that, 2Mbps is not particularly attractive. In a sense, as superfast broadband becomes available the gap between those who have access to the faster speeds and those who have access to the slower speeds is getting bigger. If you look at it from the point of view, and we quite often hear sometimes via elected members, or members of the National Assembly, of individual cases of people who either do not have access to broadband at all or have intermittent access, or access at very, very low speeds then, to them, 2Mbps is something that they certainly think would be worth having. I think one has to be careful. Obviously there is no way it can be described as being "as good as or on a par with 40Mbps".

Q36 Mr Jones: Presumably fibre-optic infrastructure is extremely important in this context. What would you say are the main barriers to the rollout of market-led fibre broadband infrastructure in Wales?

Mr Williams: Cost is the simple answer to that, but I think there are two parts of the answer. If we talk about the kind of fibre-optic structure that Virgin Media has, that takes the fibre-optic to the individual consumer, then it is almost inconceivable at the current time to envisage that that kind of availability of fibre-optic services will be available throughout Wales; impossible to envisage not simply under current economic circumstances but even before. If we went back two years it would be very difficult to imagine. If you remember the history of the rollout of some of these cable companies that have now come together under the banner of Virgin Media, many of them encountered severe financial difficulties in the cause and had to be refinanced several times before getting to where they are. So I do not think it is realistic to envisage that that is going to continue in other parts of Wales. At the moment Virgin Media does not have a build out programme at all anywhere. As it happens Ofcom has released a statement and a report this morning on stimulating the rollout of superfast broadband, and that means using fibre-optic in the network but not to the consumer's premises. I think what we will see, currently BT have a trial programme, and one of the exchanges is the Whitchurch Exchange in Cardiff (which is why I was referring to it earlier), Muswell Hill here in London is the other Exchange, and then BT have committed £1.5 billion to take this rollout of fibre-optic to the cabinet, so closer to the consumer in the years to come. I think what we are going to see over the next years is a proliferation that fibre will be spreading out further into the network, getting closer to the consumer; and what we will also see is other providers using fibre to build their own networks. I could refer here to the fibre speed programme. This is an EU and Welsh Assembly Government scheme that has built a high speed broadband connection between Manchester and Holyhead, passing through each of the business parks roughly along the route of the A55. At each of those business parks it is possible to break out of the network and offer services on a local basis. That is a service operated by a company called Geo who run similar services in other parts of the UK. There are plans for that service to be taken to other parts of the Wales. The north Wales branch of it was the first phase; there are other phases envisaged.

Q37 Mr Jones: You will recall that we corresponded last year about the famous "not-spot" of Gwytherin, which in fact has been addressed but addressed, unfortunately, not with a fibre-optic solution but, again, I think a copper solution. Is there some argument for suggesting that when notspots are addressed then you should grasp the nettle and, if you like, leapfrog the copper technology and go straight into the fibre-optic technology?

Mr Williams: There certainly was some discussion, and clearly from a consumer's point of view the deployment of fibre in Gwytherin, or in any other similar not-spot that was being brought on-stream, would be beneficial. Again, one has to be mindful of the cost to the operator; and in this case BT chose to utilise a copper option; and that I think is a decision we have to leave to them to make, as to what they can do best.

Mr Wiliam: I think it is important we provide regulatory certainty. One of the significant points of today's announcement regarding superfast broadband is the idea that we will not be enforcing regulation of pricing of wholesale broadband by fibre. In the future a communications provider could invest knowing that they will get a return on that investment, and that there will not be regulation preventing or capping the prices they could raise.

Q38 Mr Jones: Could we turn to telephony. According to your data Wales has poorer 2G and 3G mobile coverage than much of the rest of the United Kingdom. What steps would you say need to be taken in order to provide Wales with a similar level of service as is enjoyed in parts of England?

Mr Williams: As I said in my opening remarks, the general level of 2G coverage is very high, but again that leaves us with some notspots. In each case all of the operators have met the terms of their licences, therefore there is no regulatory mechanism by which we can force Vodafone, Orange, O₂, to build more transmitters. Again, encouragingly what is included in the relevant section of the Digital Britain report is the possibility of operators being encouraged to share network assets and infrastructure so that coverage can be expanded. I think that was particularly encouraging because probably that is the first time we have heard that talked about in those sorts of terms, and certainly the first time that the Government itself is signalling an intention to work with the operators towards that end. That certainly is the way forward in terms of getting greater coverage. Then we move onto the matter I have referred to once the ability to reach an agreement with the five mobile network operators to liberalise the 2G spectrum; because under the licensing regime that existed when those licences were granted, an operator could only use the spectrum for that particular purpose. That of the characteristics of Ofcom's approach to spectrum policy is that going forward people will be in a position to change the use they make of a particular piece of spectrum. They have a licence to use it but it is up to them and it will not be tied to a particular technology. We need to find a way of bringing this 2G spectrum into that liberalised regime. Under one of the Digital Britain work streams there is currently a team, including obviously all of the mobile operators, which has been brought together under the chairmanship of Kip Meek of the Broadband Stakeholder Group to try and secure an agreement between the mobile operators; and if that happens then what we look forward to is to see a considerable and rapid increase in the deployment of 3G technology in Wales; because, as you mention, our maps fairly clearly show that there is very little 3G availability currently in Wales; and that will be vastly improved if an agreement could be reached with the mobile operators. Of course, the other thing that will play into that will be the availability of more spectrum in due course.

Q39 Mr Jones: Could we turn now to television, please, and that is the question of the so-called digital dividend. You have to a certain extent touched on it, but can you describe some of the potential uses and benefits of the spectrum that will be released as a result of the dividend?

Mr Wiliam: To some extent of course the spectrum could be used for the same use in the future, that is commercially. Operators might choose to bid for spectrum that is released under the process to provide more television services, in this case probably digital television services, through further digital television multiplexes. Another area that is possible is in relation to television; there is mobile television possibly, televisions in new kinds of mobile devices that people would obviously carry round with them. There is also the potential of course for development of local television, in particular in relation to the geographic interleaved spectrum. There are basically two kinds of spectrum being released through the digital dividend process: that is spectrum that has been cleared for use across the UK as a whole; but in addition there is spectrum that will be available in some areas that, in terms of frequency, is shared with the current use of digital television; but in some areas, where the television channels are not being used, that spectrum is available for other uses. We have already looked at the potential use of that for local television. Interestingly, we held an auction in Cardiff last week, and the first allocation of this spectrum in Wales was allocated to Cube Interactive; in the end there was only one applicant. They will be using the spectrum to provide, they say, local television services amongst other things, some interactive services as well, from the Wenvoe transmitter which will service Cardiff and Newport, reaching something like potentially 300,000 viewers.

Q40 Mr Jones: Possibly more pressure on local printed media?

Mr Wiliam: Possibly, but it depends of course on the kind of services they roll out. It might well be very different from that.

Q41 Mark Williams: What steps are being taken to ensure universal access to BBC Radio Wales and BBC Radio Cymru on DAB digital radio across Wales? In your submission you talk about 74% of the population being covered largely in the south and east of Wales. You will remember our globalisation report which urged DCMS and Ofcom to work closely together to ensure universal access. Could you give us an update on where we are now in terms of extending that coverage?

Mr Williams: Under the terms of the regulatory and licensing regime that Ofcom inherited, BBC Radio Cymru and Radio Wales were treated on a par with local BBC radio services in England; that meant they were not on the UK-wide available multiplex, which is the one which delivers Radios 1, 2, 3, 4, 5, 6 et cetera; which has meant that BBC Radio Cymru and Radio Wales have to sit, they have guaranteed coverage on any local multiplex which is in operation. I think when we last gave evidence to the Committee there were two of these in operation: Cardiff Newport being one, and Swansea being the other. We had accelerated our licensing proposals for the rest of Wales in order to ensure the availability of those services on DAB multiplexes. In September 2007 we licensed the North-East Wales and West Cheshire multiplex, and that is due to go on air in September of this year. In March 2008 we licensed the West and Mid Wales multiplex, and those were two areas that were brought together to create a bigger area, which enabled us to push it further up the list of licensed areas than they would have been if they were treated as two separate areas; and that will come on air by March 2010. Finally, the North Wales multiplex was awarded on 24 June 2008 and will be on air by July 2010. What we are seeing there is albeit slow for people again; if you do not receive a service I am sure people would feel this - but it is not something that can simply be turned on by turning a switch; we have to go through the licensing proposals under the terms of the 2003 Communications Act; we have to find companies that are willing to bid; and then of course not the inconsiderable task for those companies to build -----

Q42 Mark Williams: Has that been a challenge - finding companies that will bid for those?

Mr Williams: It has in certain parts, because there is one area I have not mentioned there which is the Heads of the Valleys area, where although that was available very early as an area that could be licensed, there were no takers. Our approach there will be to allow the expansion of the Cardiff and Newport multiplex so that the operator there will be allowed to expand into the Heads of the Valleys in order to get provision to those people who live there.

Q43 Mrs James: Building further on some of the things you have said about digital inclusion in Wales and we have heard issues about the copper wiring and topography. Short of us ironing out Wales, because we all know we are bigger than England when we iron it out, what else do you think is necessary to ensure that everyone can benefit from digital technology?

Mr Williams: There are two challenges across all of these areas that we have been talking about: there clearly needs to be a coordinated approach, because in all of these varying areas of technology there are things that obviously commercial operators need to do, and commercial operators will only do things if there is a commercial return there. There are things I think Government can do to encourage that and, in certain cases to intervene where the market has not provided. That is what we have seen with the RIB scheme I mentioned earlier. There are things we as a regulator can do. Referring once again to the Digital Britain report, I think the benefit of the timing of that report is that it pulls together, for probably the first time in such a coordinated manner, what needs to be done in a large number of areas. That deals I think with the provision, the availability of the service; then I think the other half of the challenge is what needs to be done in certain areas to encourage take-up of those services.

Q44 Mrs James: Quickly on the back of that one, do you think that the Government and infrastructure providers are doing enough to provide the basis for a digitally-inclusive Wales?

Mr Williams: The position now is far better than it was when Ofcom first came into existence. There is a greater realisation that availability of digital services is not something for business-people alone or for people who have a specific interest in gaming or entertainment; these are services that provide key elements to people's lives. For instance, Ofcom's Advisory Committee for Wales has taken a great interest and has put considerable pressure on the executive at Ofcom to change the way in which mobile operators deal with 999 calls, basically to get to a stage where, if there is no 999 service available on one provider, your phone will migrate automatically to another provider to provide what is called 999 roaming. That is a very important service, as is access to healthcare services or educational services via broadband. We are moving in the right direction, there is greater appetite there than ever before and the fact that these issues have been highlighted by the work of elected members both here and in Cardiff, by Committees such as this one drawing attention to these issues, has put a greater focus on these to ensure that things are happening sooner than they otherwise would.

Q45 Mrs James: In your opinion which of the technologies is the most effective in including disadvantaged groups in Wales? Is there one that is particularly better?

Mr Williams: I do not know if there is an answer to that that is based in fact but clearly mobile telephony and what can now be done with mobile telephony - which is more than simply making telephone calls and texting - is clearly more widely available than almost any other technology. Digital television is widely available in Wales although the switchover process has not yet formally started almost in terms of what is left of it, but despite that take-up is very high. Robin, I do not know if you want to add anything.

Mr Blake: The point you make is very well-made; certainly those groups that find difficulty in acquiring a fixed line telephone connection and a PC to be able to go on-line are more likely to do so on a mobile, it is more of a personal device and they find it more comfortable to use and, with a greater flexibility that the technology is now bringing to them, it provides them with a route in where otherwise they might not have.

Q46 Chairman: Thank you very much for your evidence this morning and thank you also for your earlier memorandum which we found most helpful in preparing for this session. There are two other major issues that I want to raise, but I will do so in a letter to you; those are promoting media literacy and also on-line protection. Rather than have a long session on that this morning we would like you to write us a note about that, but we will write to you outlining what we are particularly interested in.

Mr Williams: Thank you, Chairman.