Rebirth of England.

Chapter 753 Broadband Promotion Program
"Excuse me, the broadband industry in the UK is developing slowly and stagnantly, like a snail! This has seriously affected the development of our Internet technology industry. If we cannot change the status quo as soon as possible, in a few years, the Internet industry in the UK and even the whole of Europe will lag far behind the development of Asia and North America, becoming a veritable Internet desert."

This is what the head of Digital Future Investment Company said in front of a group of heads of relevant institutions at a hearing held by the new government on the development of Britain's technology industry after Cameron came to power.

The purpose of this meeting is to launch a plan to vigorously develop Britain's network infrastructure, with the goal of building an ultra-fast broadband network covering the whole of Britain within five years.

"Although O2 Telecom has tried its best to build broadband access services in the UK, it is a fact that BT still controls most of the infrastructure for fiber optic access in the UK. I think you should listen more to the opinions of small and medium-sized companies. BT charges them too high a fiber optic access fee..."

Barron once complained privately to Jeremy Hunt, the British culture secretary:
"Of course, from a personal perspective, I am happy to see this situation. It is also because of this that O2 Telecom has been able to develop its broadband business rapidly and win many customers at a more suitable price. But from the perspective of the entire country, because even O2 Telecom needs to measure the cost-effectiveness of infrastructure investment, it will not be able to take care of a wider market in the short term..."

His other meaning, which he did not say directly, is that British Telecom got too much of the government's investment, which was inconsistent with their construction and contribution ratio.

It can be said that many of the data listed in this meeting show that the current level of network construction in the UK is far behind the current global leading ranks.

For example, according to data from Ofcom, the UK telecommunications regulator, less than 30% of British households have access to ultra-high-speed broadband with speeds of 5Mbps or above!

Currently only about 12% of Internet users in the UK have uninterrupted access to high-speed networks of 5 megabits per second, compared with 65% in South Korea.

A survey result from Ofcom last week also showed that only 0.2% of households in the UK are currently connected to fiber optic networks, while the proportion in Sweden is 12%, and Japan ranks first in the world with 34%.

Moreover, the main fiber optic access method in the UK is fiber to the road - first connecting the fiber optic cable to the telephone booths in each area, and then connecting to each household through the existing copper wires. This is called FTTCand, and the fastest Internet speed available is only 4 megabits per second.

O2 Telecom provides fiber-to-the-home (FTTH) services in some areas, with speeds of up to 100 megabits per second.

"Broadband network itself is not the goal. The most important thing is to use various services of broadband network, such as remote classroom and telemedicine, so as to make people more closely connected. This will change people's lifestyles, accelerate the transmission of information in the whole society, and promote the development of our Internet industry. Although we already have some leading Internet companies in Europe and even the world, such as Woaw, Argos.com, and DailyVedio, if we do not speed up the popularization of broadband, the development of these companies will eventually be restricted, and they will eventually lose to those companies in Silicon Valley..."

Barron told Culture Secretary Jeremy Hunt that these words were not alarmist:

"In the past year, the digital industry contributed 10% of the new value added to the UK, equivalent to about 1300 billion pounds, and the number of employees in the digital industry accounted for 6% of the total British workforce, more than 170 million people. It can be clearly seen that the digital industry still showed strong growth momentum during the economic recession."

Similarly, according to a survey by the London School of Economics, laying out ultra-fast broadband networks across the UK could create more than 30 new jobs.

And every £1 million the government invests in network-related infrastructure is likely to bring in nearly £100 billion in related industry growth! As the saying goes, "a new official starts with three things". Cameron himself is very concerned about the development of London Tech City - two years ago, Johnson of the Conservative Party was appointed Mayor of Greater London, and he also strongly advocated the promotion of London Tech City.

In addition, he had promised in the general election to increase government investment and promote employment, and now he also needs to implement some plans that can be widely publicized.

This is also the main reason why this discussion was held shortly after he took office.

As for the funds to promote this plan, Baron promised Cameron that if the funds for this plan were used more "fairly" and invested in companies that were more proactive in construction, rather than still relying on British Telecom as the main force, then his British Fortune (BFT) Fund would be willing to return part of the funds invested in this fund and the corresponding interest to the government in advance.

According to this agreement, the BFT Fund will first return 25% of the funds and corresponding interest to the Bank of England, with a total amount of more than 135 billion pounds. These funds will be used to invest in plans to promote Britain's broadband infrastructure within five years.

When Standard Chartered Bank acquired Northern Rock Bank, which was injected with capital by the government, Barron was willing to let Standard Chartered Bank return the £250 billion invested by the government.

But the condition proposed at the time was that the government needed to inject a total of 500 billion pounds into the British Fortune (BFT) fund, part of which would be used to repay the 250 billion pounds, and the other part would require the BFT fund to eventually return the funds and corresponding interest through investment.

Now, through Barron's series of investments, especially the profits from short selling in Europe, there is not much pressure to return part of the funds.

And most importantly, when the remaining 250 billion pounds of the BFT fund were converted into US dollars, the exchange rate of pound to dollar was as high as 2.11...

Now, although the exchange rate of the pound to the US dollar has not reached its lowest level in ten years, it has also dropped to around 1.45.

The advantage they have gained simply because of the exchange rate is already very obvious, not to mention that the assets that the BFT Fund bought at the bottom during the subprime mortgage crisis have now appreciated a lot.

Now Barron doesn't even have to sell those investment assets. Just using a portion of his own funds to make a profit is enough to pay the 25% of the funds and the corresponding interest first.

Moreover, O2 Telecom will inevitably receive a considerable portion of the subsidies in the government's broadband infrastructure promotion plan using these funds.

(End of this chapter)