Digital Economy Bill

Rishi Sunak Excerpts

Tuesday 13th September 2016 Commons Chamber

[Rishi Sunak (Richmond (Yorks)) (Con)]

The average smartphone user in the UK uses their device for more than two hours daily, so when we talk about rural communities without access to a mobile signal, let us be absolutely clear about what we mean. We are talking about the fact that people in swathes of our country are unable to participate in an activity that the rest of us consider so indispensable and so vital that we engage in it for 10 minutes of every waking hour.

The Bill before us today contains two important steps towards closing that gap. The first is action to reform the electronic communications code to reduce land rents and to free up capital to invest in infrastructure, and the second is Ofcom’s new powers to capitalise on the opportunities for dynamic spectrum access.

Let me turn first to the provisions for reducing the cost of land used by mobile operators. In going beyond the Law Commission’s recommendations and moving wayleave valuation to a compulsory purchase basis, the Government have acted boldly in the public interest. This one change will do the following: reduce rental costs; tackle the vexatious issue of ransom rents; and begin to close the gap between the rent for an electric pylon—in the hundreds of pounds—and that of a mobile telecoms mast—up to the tens of thousands of pounds.

Let me be clear: some of my constituents will lose out from this Bill. It is no secret that small rural businesses, farmers and landowners have benefited from the extra income that renting land to mobile infrastructures can provide. It is an important source of income, and I take very seriously the concerns of the National Farmers Union and the Country Land and Business Association. What is equally plain, however, is that, in boosting investment in rural coverage, the potential benefits to rural communities can outweigh those costs. We must not expect the rural people whose income will be reduced by this Bill to receive nothing in return. The analogy is made with the compulsory purchase powers in the utility and energy infrastructure side of our country. However, the National Grid is a regulated asset, which means that any cost savings it enjoys as a result of compulsory purchase powers are automatically, by regulation, passed on to customers. In the case of the mobile operators, that is not necessarily so. Interfering with property rights, as the code does, is a major step for this House to endorse. I therefore urge the Government to ensure that the Bill benefits not just the network operators’ balance sheets, but the public interest. Operators will save hundreds of millions of pounds as a result of these changes, and in return there are a few things the Government can do to keep their feet to the fire. First, the Government can ensure that they live up to the obligations of mobile coverage that, by 2017, 98% of UK households have access to 4G and 90% of our land mass is covered by voice and text.

[Antoinette Sandbach]

Does my hon. Friend agree that it is a great source of frustration that mobile phone companies, when they sell 3G or 4G contracts knowing there is only 2G or no provision, say that it is just an opportunity to access 3G or 4G where there may be such provision? Does he not think that is mis-selling?

[Rishi Sunak]

My hon. Friend makes a valid point and I share that frustration, which my constituents have also brought to me.

There are further steps that the Government can take. I endorse here the comments of the hon. Member for Berwickshire, Roxburgh and Selkirk (Calum Kerr). The Government could suggest progress towards a model of independently owned infrastructure, such as is found in the United States. Independently owned masts are, on average, 10 metres taller. They can host multiple clients, unlike network-operated masts, so they reduce costs in the system, expand coverage and broaden access, and are a welcome development.

I urge the Government to look at the example in Australia where Vodafone and Telstra have combined to form a national roaming agreement, allowing network sharing in the country’s most remote regions. When the next spectrum licence auctions come along, we must ensure that coverage is paramount in the conditions. I concur with the comments by the hon. Member for Berwickshire, Roxburgh and Selkirk: we should look at the example in Germany, where they use outside-in provisions to cover rural areas before moving to the dense, profitable urban areas.

The second part of the Bill that I want to mention is the slightly technical area of white space. It gives me great personal pleasure to talk about these clauses, for my brother-in-law, as a young PhD student in the United States, was one of the first people in the world to develop a working white space system, which allowed the transfer of data on this innovative new use of spectrum. White space refers to radio spectrum frequencies that have already been allocated to users but which are not always used. For example, digital terrestrial television signals use different frequencies in different parts of the country, so as not to interfere with one another, and that leaves an opportunity for a new generation of mobile devices to use that white space spectrum in particular parts of the country. That process is known as dynamic spectrum access.

Much as I criticise Ofcom in other areas, I would commend it for being incredibly farsighted and enabling the UK to be a leader in capitalising on this innovative new technology. It has set up several trials in the past few years.

The Bill will specifically allow Ofcom to register and regulate geolocation databases. Databases allow the new devices to query exactly what spectrum is being used in what area, and it is a practical and necessary step required to make white space devices much more widespread. White space spectrum is very powerful. It can travel hundreds of miles and through walls. For that reason, it is a technology that we must capitalise on, and I commend Ofcom and the Government for taking steps in that area. It will be of enormous benefit to my rural constituents.

In conclusion, as technology and innovation open up new frontiers and possibilities, it is the role of this House to ensure that every member of our society, rural or urban, can reap the rewards. The foundations laid by the Bill make that outcome a more realistic probability and I am delighted to support the Bill this evening.