Broadband in Scotland : broader, faster, poorer, remoter

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Sutherland, Ewan (2017) Broadband in Scotland : broader, faster, poorer, remoter. Fraser of Allander Economic Commentary, 41 (1). pp. 93-119. ISSN 2046-5378

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Abstract

The provision of universal broadband Internet access in Scotland has been the subject of political promises, to support economic growth and reduce social divides. The market supplying broadband is subject to complex, multi-tiered governance. Until the UK leaves the EU, it is subject to EU aspirations, directives and regulations, which are implemented in London by the UK government and regulatory authority. There are strong path dependencies, arising from the Openreach agreement on wholesale access, between the regulator and BT, which affects both the residential and business markets. Competition in fixed broadband is primarily service-based and dependent on regulation. Mobile broadband has limited infrastructure-based competition, with incentives from UK government to extend coverage. State aid has been provided by complex means to support increased rural provision, but has not been ended, in favour of cross-subsidies. Those disinclined to use the Internet are being encouraged to do so, by local initiatives, partly to ease the digital by default strategy for government services. Brexit brings the possibility of change, by leaving the EU governance system, while the possibility of Scottish independence would require an entirely new system of market governance.

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