Agenda for Action in the UK:  Continued

CHAPTER 4 VIEWS OF WITNESSES

THE CURRENT SITUATION

4.1 "The IT revolution and the information age is a reality and it is going to affect the way every business operates and the way every one of us leads our lives"[1]. The technology for the information superhighways of the future is already in place. Local broadband networks are operating, in the United Kingdom in Cambridge and Ipswich,[2] and prove that the technology is there and it works (Q 580). The superhighways themselves, on the other hand, do not yet exist (Q 863, pp 191, 198, 300).

4.2 PC penetration per household is 37 per cent in the United States,[3] 25 per cent in the United Kingdom and only 7 per cent in Japan, although the Japanese market is growing rapidly. Twenty per cent of United States households have modemed PCs, compared with only 2 per cent in the United Kingdom and 1.4 per cent in Japan. There are 16 Internet hosts per thousand population in the United States, 12 in Sweden, 5 in the United Kingdom and 1.3 in Japan (Q 299). Worldwide, it is estimated that some 30 million people have access to the Internet. Most of these Internet users are limited to the text that can be squeezed down a traditional telephone, as only a small minority yet have access to high speed image transfers. By 2002 more than 200 million people worldwide[4] are expected to be connected to at least part of the Internet, with 150 million subscriptions to on-line services. The World Wide Web is doubling in size every three months. Approaching 100,000 Web sites were forecast by early 1996. Fewer than 300,000 British PC owners currently subscribe to either a Bulletin Board Service or have an account with an Internet Service provider. This represents a penetration of about three per cent of PC owners (p 244).

4.3 The United Kingdom Education and Research Networking Association (UKERNA) said that the challenge was to be ready for the information superhighway when it did arrive. UKERNA added that we did not yet know how to make the most of the new information technology developments because "our thinking is conditioned by many years of using narrow band telecommunications where long distance transmission capacity is characterised as a scarce and expensive resource" (p 301). The changes brought about by abundance could lead to developments of major social and economic importance.

4.4 The Internet (a global network of networks) was generally not considered by witnesses to be a superhighway (p 234), just "one, relatively slow, component" of it (p 191). The Institute for the Management of Information Systems (IDPM) described aspects of the Internet as "actively userhostile" (p 235) and expressed concern over the resultant public perception of the information superhighway. The IDPM said that the "important task is to persuade the majority of users to upgrade from the "Internet" ... before the widely expected consumer backlash (against current content, response times and difficulty of access) does too much long term harm to the underlying concepts" (p 235).

4.5 Most witnesses were more up-beat. Microsoft described the Internet as "an extraordinarily successful, marketbased, global network" (p 145), HeriotWatt University said "the development of the Internet will fundamentally effect the way that education is provided" (p 228) and the Library Association described the Internet as a "treasure trove of information from many sources" (p 251). The Library Association also praised the development of the World Wide Web for being user friendly and enormously powerful for information retrieval. The University of Warwick said that most of the basic Internet standards were now well established and that most difficulties were associated with areas of active development where standards had not yet been fully defined and ratified (p 304).

Developments towards the superhighways

4.6 The British Computer Society (BCS), said: "it is highly likely that any future superhighway will have evolved from the Internet. It is the best available role model we have for how such a network might be used" (p 165).

4.7 Microsoft described the current state of the on-line market as "very small". They estimate that in the United States there are about 10 million users of the World Wide Web. In the United Kingdom there are about 500,000 users of the World Wide Web or commercial on-line services, and three million Internet e-mail users. Microsoft were one of a number of witnesses to refer to the fact that, unlike parts of the United States, where local telephone calls are free, in the United Kingdom local telephone calls are charged, and "it can be quite prohibitively expensive if you try and use an on-line service during the day" (Q 368). BT responded to this point by saying that whilst local telephone calls in some parts of the United States were free, service providers there tended to time (and charge for) Internet usage. They also added that "there is no such thing as a free telephone call! The package in the United States that you pay for on a monthly basis includes unlimited use in a very small area which is defined as your local area, and that is built into the package charge". BT believed that the large numbers of personal computers in US homes, where penetration was between 40-50 per cent, had been "probably the more significant enabler in terms of Internet traffic" (QQ 535-7).

4.8 Both BT and Microsoft talked about the natural progression to broadband services through medium band. Microsoft said that "we believe that ISDN is hugely important in terms of mid band because, in order for this to be a really captivating medium, we need much more richness in terms of graphics and sound and ISDN can provide that and give people the performance they need". They pointed out that ISDN was at present far too expensive for the average consumer in the United Kingdom (Q 368). New systems such as Java, where Microsoft and other companies are providing additional features including video sound, would greatly increase demands on capacity and necessitate universal access to ISDN "and through the years even broader band than that" (Q 402). CompuServe complained that although BT promoted ISDN for business use, its spread into UK homes was small, and particularly so when compared to its take-up in Germany, where ISDN lines were cheaper (QQ 757-761, 766-767).[5] Ian Taylor MP, Parliamentary Under Secretary of State for Science and Technology, said that "until this year `ISDN' has meant `it still does nothing' as far as BT is concerned" (Q 1008).

4.9 The Cable Communications Association (CCA) said that "the cable companies are building the networks as quickly as we can physically do it. The development of applications and services ... is therefore now the key question. It will be these applications and services that transform the networks that we are building into the information superhighway." (Q 52)

4.10 Many witnesses bore testimony to the abandonment of the fruitless search for a single "killer application" which, it was once imagined, would entice large numbers of people to use the superhighways of the future. In particular, only a few years ago it was assumed that video-on-demand services would be a principal business for cable companies, and this assumption has been proved false (Q 661, p 193). The Confederation of British Industry (CBI) said that currently the single most important use of information highways was e-mail, which had grown significantly as an inexpensive and convenient means of communication. It was believed that the United Kingdom was amongst the heaviest users of e-mail in the world and growth in its use by companies was likely to continue (p 193).

4.11 The CCA said that "you are not going to find one application which appeals to absolutely everybody. I think you may find two, three or four themes which are developing." They saw education, home working and games as the three most important current developments. Almost 1,000 schools had been cabled under the Cable in the Classroom programme, and the CCA estimated that by the end of the decade almost three-quarters of United Kingdom schools would have been cabled free of charge by cable companies. Cable companies were working on a number of projects with schools to develop applications for children to do homework (Q 54).

The United Kingdom

4.12 In February 1996 the new fibre optic network passed more than five million of the 16.2 million homes within the United Kingdom. Slightly over one million homes and businesses were connected, and some 500 schools were also connected (p 192). There are about 120 Internet service providers in the United Kingdom (Q 368). In February 1996 the United Kingdom had more Internet hosts per head than either France or Germany, with 7.8 hosts per 1,000 inhabitants as against 5.6 for Germany and 2.4 for France.[6]

4.13 Unlike the governments of some other countries, the UK Government has set no target dates for the installation of broadband infrastructure. Mr Taylor, the Minister for Science and Technology, said, however, that "the cable industry's own build rates in their franchises would mean that probably, even if we were not to let any more franchises, 73 per cent of the population would be covered by the year 2001, and I suspect that we will launch more franchises so our target is about 85 per cent.[7] For those regions which are not likely to get cable because of geography we have released some 10 gigahertz radio spectrum which is ISDN equivalent in terms of capacity. I think the Government is working to make sure that by the beginning of the next century the bulk of the UK population will have access to the potential to satisfy their demand for wideband and broadband technology" (Q 1012).

4.14 In 1994 a study of investment in networks in the United Kingdom and its major competing countries showed that the United Kingdom was first or second in all the major areas of network investment (Q 12). OFTEL said that the United Kingdom "is leading the world in liberalisation, particularly in infrastructure competition, competing networks; that the investment in networks is being made at a rate which exceeds almost anywhere else and arguably the United States as well, that the benefits are being delivered; and ... that the rest of the world is now following what some years ago was thought to be a rather eccentric UK approach." (Q 27). Microsoft said that "we certainly as an organisation have benefited massively from the deregulation of telecommunications in the United Kingdom" (Q 368). CompuServe took a similar view, saying that partly because of its deregulated environment, the company found it easier to operate in the UK than any other European country. "We definitely find it more attractive operating our business here in the UK than in France or Germany both from the legal point of view and the tax point of view and the employment perspective" (QQ 756, 771). Mercury Communications said that the UK telecommunications market was arguably the most competitive in the world (Q 872).

4.15 The Policy Studies Institute (PSI) said that a liberal telecommunications regime in the United Kingdom had led to a high level of investment in the infrastructure. "The fact that the work has been carried out by a number of different companies has, however, meant that the network is patchy and uncoordinated." (p 259).

4.16 The Association for Information Management (ASLIB) agreed that the United Kingdom had a head start for developing the information superhighway in terms of telecommunications deregulation and use of the English language, but were concerned that these advantages were "going to be whittled away very fast indeed" by English-speaking competitors from countries including India and Canada (Q 140).

4.17 The Scottish Office (pp 287-289) and the Welsh Office drew attention to particularly note-worthy developments in their respective countries.[8] The Welsh Office listed the six main priorities for its role in developing the Information Superhighway in Wales, and said that "in addition to the potential benefits to Welsh business and society generally, it is worth highlighting the potential for the new technologies (for example, to enable teleworking) to put rural areas on an equal footing with urban zones in terms of both business development and service delivery. Potentially this could promote more even economic development within Wales and also between Wales and other regions of the UK or the world." There is a plan to ensure that at least 130 business parks in Wales are cabled over the next three-five years. The Welsh Development Agency-sponsored "Network Wales" has encouraged small firms to establish a presence on the Internet. Wales has a higher density of telecottages and telecentres than any other part of the UK. A pilot telemedicine project in Mid Wales links GP surgeries and hospital sites and allows remote diagnosis of dermatological conditions (pp 307-308).

USA

4.18 The position of the USA with regard to the information superhighways was seen as both a threat and an opportunity by different witnesses. UKERNA said "The US understands the role of Internettype developments better than any other country and this will allow them to achieve dominance in the information superhighway market place if the United Kingdom and other countries do not take appropriate measures to strengthen their positions" (p 301). A particular threat highlighted by the Economic and Social Research Council (ESRC) was the trend in the USA towards packaging all types of education, entertainment and business information products together. The consequences for the industry were clear: "Those who create the most attractive bundles are also those who tend to operate on the largest scale" (p 212).

4.19 ICL said that "there are threats because of the sheer scale, speed and political commitment of the USA to the Information Superhighway. The UK could and should help to develop EU policies to counterbalance the potential domination of US products, ideas and culture" (p 232). ICL added, however, that "the US provides us with a window of opportunity" (p 231) for exploiting the United Kingdom's skills and innovation potential in publishing, broadcasting, distance education, animation, film and video technical capability, music and software. Europe could also use the opportunity to export its languages and cultures back to the multilingual USA.

4.20 Virtual Precincts Limited said that it was not a problem that the US dominated the software industry world wide and the cable industry in the United Kingdom because these were just enabling technologies: "What is important is that United Kingdom companies become successful service providers, since the successful service provider will have access to a global market through the information superhighway" (p 308). The Universities and Colleges Information Systems Association (UCISA) agreed and said that the United Kingdom already excelled in services (e.g. education) and should develop them further instead of trying to compete with equipment producers in the Far East or advanced products companies in the USA (pp 299-300).

Japan

4.21 Janice Hughes of Spectrum Strategy Consultants said that Japan had a highly controlled and centrally planned vision for the information superhighway. Current initiatives included the creation of a Telecommunications Council to co-ordinate cross-departmental activity in this field. "But unfortunately in practice the two key ministries ... are completely at loggerheads and a lot of organisations in Japan have to have two different regulatory advisers in their companies ... because they have to send different people to the separate ministries." The one Ministry was developing content initiatives, whilst the other was trying to promote broadband networks, in which it had commercial shares, and video on demand trials (Q 313).

ACCESSIBILITY

4.22 The problem of individuals, sections of society or geographic areas without access to the information superhighway (the `have nots'), and how these would be disadvantaged in comparison with those who did enjoy access (the `haves') was raised by a number of witnesses. For example, the Office for Standards in Education (Ofsted) said: "A small minority of pupils, with access to the Internet at home, is advantaged over their peers" (p 256). The Library and Information Commission said that the `have nots' were at risk of being left behind (p 247) and the ESRC said it was probable that the gap between the `haves' and `have nots' was already growing (p 213).

4.23 The Direct Marketing Association (DMA) used the phrase `electronic ghetto', and called it a serious social issue requiring urgent evaluation by the Government: "the electronic ghetto describes a new arena for discrimination between rich and poor, the `haves' and the `have nots'. Recent years have seen further rapid polarisation between these groups in the UK in terms of income and opportunity, and the coming world of electronic communication presents yet another source of disadvantage" (p 202).

4.24 The National Consumer Council (NCC) predicted opportunities for those who could not at present fully participate in society, including disabled people, but said that "the very enormity of the changes could exacerbate the position of already disadvantaged consumers if they are excluded" (p 611). The DMA said that Government would need to make a conscious decision for the information superhighway to become a reality to such groups (p 200).

4.25 The Royal Academy of Engineering said that there had already been much research into public kiosks from which the "Information Superhighway" could be accessed, some of the work having been initiated by G7. Kiosks were being used to a good extent in Japan and there were early versions also in use in France and the United Kingdom, with advanced versions under development. Kiosk development was potentially important as their use was not confined to public information alone and could be viewed as "tomorrow's public telephone boxes" (p 276).

(i) Ease of access

4.26 The CCA said that "what we really believe is the answer to getting true service throughout the United Kingdom is allowing competing networks to build." They estimated that cable would pass 75 per cent of households in the country when all the cable franchising and building had been completed. Radio loops and emerging new technologies would allow the industry "to reach all parts of the United Kingdom with competing networks in an economic fashion". The geographical issues of universal service were, and would continue to be, addressed by rapidly evolving technology (Q 102). At present, radio worked well in areas of sparse population, but developed problems in congested areas. Cable, with its almost unlimited capacity resulting from its large bandwidth and its ability to connect "hundreds and thousands of customers to the cable network", was better suited to densely populated areas (Q 105).

4.27 The Royal Society of Edinburgh said that "the Local Loop,[9] and the facility of individual homes and small businesses to connect to the network is crucial to the development of the ISH.[10] In many cases it will be uneconomic for competition to exist in the building of this infrastructure, especially in rural areas. The Government should seriously consider non-market funding and ownership models, or alternatively regulation and policy frameworks that encourage local loop providers to support open communication standards and gateways to other networks. This is possibly the most socially valuable part of the network since in the long term it offers direct access to consumers, and offers citizens the opportunity to communicate and conduct business from their own locality." (p 285)

4.28 OFTEL said that radio spectrum at 2Ghz had been made available by the DTI to enable operators to provide fixed telephony services by that medium to remote rural areas of the UK. The designated areas were local authority areas where the average population per square kilometre was less than 50. This covered much of Scotland and Wales and a substantial number of local authority areas in England.[11]

(ii) Affordability

4.29 The National Consumer Council has recently concluded that "affordable access to new services for all in their own homes is probably unachievable in the medium term. To use them consumers need expensive equipment, such as a PC, or perhaps in future a PC/TV, and in the short to medium term, a modem (until communications links become entirely digital). Services themselves also need to be paid for. Even modest use of new services is unlikely to make a light user scheme an appropriate way to subsidise access for low-income households. New ways will need to be found of meeting demand for service among consumers who cannot afford the necessary equipment or line usage. The existing community service requirements included in BT's universal service obligation provide one model for this."[12]

4.30 The Department of National Heritage said that the idea of libraries forming the focus for public access to superhighways was gaining currency, and some libraries were already providing public access to the Internet. The Department and the Library and Information Commission were "investigating how best to encourage this access within the framework of a coherent IT strategy for libraries. The involvement and engagement of the private sector in this process will be critical" (p 589).

4.31 The National Association of Citizens Advice Bureaux (NACAB) saw themselves as being able to fulfil a key role in extending access to the Information Superhighway of the future. The 1,800 Advice Bureaux are, between them, used by 5 million people every year, and one in four of the adult population are thought to use the Bureaux at some point in their lives. NACAB said that "our clients on the whole are what we would term the have nots, who might be left behind in the information society ... the people who use us are largely poor, troubled, distressed, fallen on hard times, and they come to us for advice and information. So we have the confidence of the have nots, and that is the client group that uses us a very great deal. ... Citizens Advice Bureaux getting involved in the Superhighway means we can bring them aboard to some degree". As a voluntary organisation the Bureaux needed grants to enable them to fulfil this role. It also had no IT training budget for its 28,000 advice workers, many of whom were volunteers who might work for the CABx for a comparatively short time (QQ 606-7, 609).

4.32 The Citizens Advice Bureaux are currently dependent on a 70 volume paper database which is updated every month, using a considerable amount of staff time. NACAB thought that changing to an on-line database system would make it a much more effective tool (Q 611). They believed, however, that their main business over the next 10 years would remain person to person advice (Q 617).

4.33 The CCA were convinced that affordability "really is the critical issue for universal service"--to which they believed that competition would provide the main solution (Q 102). Another way of reducing start-up costs will be provided by the development of Network Computers (NCs), consisting of comparatively cheap terminals linked to servers which provide the memory functions, including for software (QQ 540-545).

(iii) User-friendliness

4.34 Mr John Harper addressed the future takeup of the Internet, and other services, in the home and expressed the need for a change in mind set away from delivery by the personal computer (PC) with its inherent problems of cost and usability: "If either the Internet or highspeed highways proper are really to catch on with the mass public the industry needs to come up with a new generation of terminals retailing for much less than a PC, which can be used by people who are not computer literate and which will fit in the livingroom environment" (p 226). At present insufficient attention was being given to the development of such hardware in the United Kingdom.

4.35 A similar view on the need for userfriendly equipment was expressed by the IDPM: "Service standards will probably be driven by the recent US recognition that at least 80 per cent of the population will never pay for products that are more complex to handle than a TV Zapper and that such a device is probably all that is needed to handle the most profitable 80 per cent of applications" (p 236).

4.36 The universal experience of accessing the Internet seems to be that transatlantic traffic can be frustratingly slow, particularly in the afternoons when schoolchildren are doing their homework and the United States' working day is in full swing. As ASLIB put it, "if you want to get something on the Internet you can go away, have a cup of coffee, come back and it is still slowly downloading". ASLIB blamed this problem chiefly on the current lack of sufficient bandwidth (QQ 167-170). The Director General of the British Library agreed: "America just does not exist in the afternoon as far as the United Kingdom is concerned" (Q 229).

4.37 Microsoft said that they were building a data centre in Europe and in Asia to replicate the most popular sites on the Internet, which would avoid the need to access the information from the United States. "Ultimately one of the differentiators of one service versus another will be the level of performance they are able to provide a user for the majority of the content they want to get at. If you want to access a very specialist site on an unusual topic which ... is on a small PC in someone's bedroom in Guatemala ... when you eventually try to get to the person's bedroom in Guatemala, you will be going down a very thin pipe and it will be very slow but you can still get to it if you want to." They thought that Internet access would soon speed up, and ISDN would improve the speed of access still further (Q 400).

4.38 Another problem with the Internet is that, as the Newspaper Society put it, "it does take a degree of perseverance and at least two children to be able to understand how to operate it properly" (Q 359). ASLIB thought that although in the long term people would learn to navigate the information superhighway without assistance, over the next two decades the majority of people would be ""have nots" who would not be able to find their way through the information which is on the superstructure". An interface of professional advice and help would therefore be needed between the ordinary citizen and the global information infrastructure, which could be provided through the public library service[13] or community centres (QQ 128-129). The current generation of cataloguing and indexing tools was slow, tiresome and inefficient, but it would be "at least 20 years, maybe longer, until the computerised automatic indexing systems really come to fruition" (Q 134). Research was being carried out in the United States on the development of "intelligent agents", pieces of software which understood individuals' information needs and priorities and would seek out information on the Internet accordingly. ASLIB called on the Government to encourage further research into "intelligent agents" in the United Kingdom (Q 171).

4.39 Another problem is the sheer volume of information on the Internet, much of which is junk. ASLIB recommended using a system of three-, four- and five-star information sites, "based on some sort of general understanding of what the quality of the information is" (Q 170).

(iv) Universal Service Obligation

4.40 The European Communications Network (ECN) considered that the Universal Service Obligation (USO) could be divided into a geographic part (dependent on where one lived) and a demographic part (dependent on who one was and whether one could afford to pay). "The geographic USO can be simply resolved by levying a licence fee on all operators to cover the cost of getting the network to remote areas ... The demographic USO is a political dilemma" (p 218). The National Consumer Council naturally put the consumer first and said that "The concept of universal service obligations should be extended to all consumers" (p 612).

4.41 Other witnesses held the view that universal access to the infrastructure rather than universal service should be the main concern (pp 222, 299). The Universities and Colleges Information Systems Association (UCISA) said: "The United Kingdom must proceed as soon as possible to the installation of universal infrastructure, priced at a realistic level, in order to allow use by all" (p 299).

4.42 To promote access and services in uneconomic areas the Federal Trust proposed the establishment of national universal service funds managed by the regulators.[14] The Federal Trust also proposed the establishment of a maximum level of service which EU member states could insist on. It recommended that the imposition of formal universal service obligations should be progressive, taking account of the cost and availability of new services (p 222). This would help Member States which might find it difficult to provide a full range of high level services to all areas.

4.43 The CBI, on the other hand, doubted whether it was necessary or relevant to extend universal service obligations to the information superhighway and, even if this were done, doubted whether the economic benefits of the information society would be forthcoming in the immediate future (p 194).

CONTENT

4.44 Many witnesses stressed the need to promote British content. Content was described as "the essential ingredient" for the information superhighway (p 161) and the DMA said that "in our view it is content and application that is critical not the technology" (p 207). In this field many witnesses (eg pp 243 and 259) suggested that the United Kingdom already had an important asset that should be exploited to our advantage--the English language.

4.45 The CCA said that "we all agree, as an industry, that the greatest need for content right now for our infrastructure is more good British programming as opposed to more important programming" (Q 53). ASLIB warmly supported the suggestion of a content foresight initiative "to ensure that the United Kingdom is at the leading edge of the global information infrastructure of the future" (Q 149). They wanted the initiative to run across government departments, and called on the Government to create a set of objectives to be achieved within a certain time frame (Q 142).

4.46 De Montfort University said: "Britain has immense collections of heritage information and intellectual property on which to base major media business of the future. Government can promote the digitisation of and access to this heritage and intellectual property by supporting key projects and demonstrators" (p 197). This view of "unlocking the nations archives" was also supported by ICL (p 231). The University of Oxford suggested that high priority should be given for access via the information superhighway to primary information (eg Hansard and legislation) (p 303).

4.47 The Department of National Heritage said that as "content-rich" institutions, museums were well placed to exploit the possibilities of superhighways and take part in the developing new technology. The Museum Documentation Association (MDA), funded by the Department, develops standards for museums, advises them on the implications of the new information technologies, including developments in superhighways. The Department had made additional funding available to the MDA to enable it to carry out a special investigation into IT and museums. The Scottish Cultural Resources Access Network (SCRAN 2000) is the first recipient of an IT award (£7.5 million) from the Millennium Commission. SCRAN 2000 is a joint project by the Scottish Museums Council, National Museums of Scotland and the Royal Commission on the Ancient and Historical Monuments of Scotland. It involves digitising about 8 million items and 10,000 images from over 200 Scottish museums and institutions and will be widely accessible to schools and libraries (p 589).

4.48 The PSI and ICL considered that the Government had a key role to play in providing content with social applications. The PSI suggested services to provide a range of information needed by the citizen (eg social and political entitlements and responsibilities, so-called `citizenship information') (p 262). Telecential Communications said that "Network operations are illequipped and disinclined to become suppliers of content" (p 294).

4.49 Microsoft stressed the need for content generally: "you can have the right price, the right infrastructure, the right technology, but without content neither would be possible. That content needs to be useful, it needs to be appealing, it needs to be relevant, and ... there is a role for government in protecting the work, the investment that is required actually to create this appealing, exciting content" (Q 368). CompuServe saw the future lying in specialist content areas. "One of the overriding trends in the industry is that it is becoming more segmented so that whereas in the past you might have joined CompuServe or America Online or MicroSoft, in the future you are much more likely to be joining Medics Online or Accountants Online". They foresaw the development of both professional and lifestyle sectors, for example catering for children or teenagers. "This product today is far too complicated for the broad market, but all our energies are being focused on addressing that issue, not on acquiring more content and not on necessarily even making it cheaper, but we are trying to make it easier to use." (QQ 744-745)

4.50 Mr Phillis, the Deputy Director-General of the BBC and Chairman of BBC Worldwide, said that the BBC's programme content was "the strongest asset the BBC has and can bring to the superhighways and the digital age ... it is an essential part of planning for the BBC's future strategy to ensure not only that that content and those programme services are available by the traditional means of broadcast delivery, but that we can extend the availability, the understanding, and the range of information and supplementary information that the on-line services of the superhighway will allow us to exploit. It is very much driven by the belief that irrespective of the technology in terms of the services to the citizen and to the consumer, it will be the content of programmes which will attract and stimulate and draw people to the new means of delivery" (Q 464).

Educational content

4.51 Many witnesses agreed that educational content was one area that the United Kingdom should develop and exploit (e.g. pp 224, 251). The view of the Further Education Development Agency (FEDA) was typical: "there is potential for growth in United Kingdom computerbased learning materials which reflect United Kingdom rather than US cultures and languages" (p 225). FEDA added that the main market for products might be with individual distant students and the wider community.

4.52 The National Council for Educational Technology (NCET) drew attention to the need to develop educational software in the United Kingdom, and suggested that a good place to start would be in looking at CDROMs which would address British curriculum requirements. There was, for example, no appropriate software targeted on mathematics and science for Key Stage 2, and "much of the software that is available in other curriculum areas and for the older age groups is from America, even though ... some of it has been produced here, shipped out to America, packaged and re-sold back to us" (QQ 251-254).

4.53 NCET said that one of the main barriers to the development of educational software was funding. "While there is a tradition of paying for resources in terms of books, there is not yet a tradition of paying for resources that come over the wires in the digital domain. Those schools that have connected to the Internet at the moment ... are getting information apparently "freely" over the Internet and so in order for there to be a revenue stream for content producers education establishments are going to have to pay. Unless there is that change of culture at some point the big commercial operators capable of producing high quality materials will not come into the market" (Q 255).

4.54 The University of Oxford said that to realise the potential benefits of the information superhighway "there can be no doubt that we must move to the stage of inter-active technology" (p 303). The content would also most likely be delivered in a multimedia format, and De Montfort University highlighted the problem of cost: "Multimedia materials are typically one hundred times more expensive to prepare than traditional class materials and costs are frontloaded. These costs must be recovered through scaling up of market penetration via a pervasive high bandwidth network infrastructure" (p 197). De Montfort added that such a network did not yet exist outside the Higher Education institutions and that private sector finance would probably be required if it were to be developed.

SERVICE PROVIDERS

4.55 OFTEL defined service providers as "people who are not building their own networks but want to provide services over somebody's network." The Director General of OFTEL saw service providers as one of the main challenges for the development of the Information Superhighway (QQ 42-4). BT was keen to see "many thousands of service providers", claiming that it was in BT's interest "to encourage them by example, by help, by doing everything possible to get service providers up and running because without them our network investment is wasted" (QQ 509, 511).

4.56 Mr John Harper said that the dominance of the BT network, so that other companies were dependent on it for the bulk of their customers' traffic, was the single most important cause of problems. He proposed "a fundamental restructuring of the industry into wholesale (network) and retail (service providing) sectors ... for reunifying network operations under a single regulated company; and for completely deregulating provision of services and throwing it open to allcomers" (p 227). He believed that such action would stop unnecessary and costly duplication of network facilities. A similar proposal was made by Cable and Wireless, which said that a separation of service and infrastructure providers would allow the "unencumbered creation of new services, products and players" (p 173).

4.57 Telecential Communications said that because service provision and network operation had, traditionally, been within the same company the development of both had been restricted. A free market for service provision would lead to new services and incentives for network operators to provide a high capability infrastructure (p 295).

4.58 Service providers indicated two main concerns in a recent OFTEL consultation exercise. First, that the network owners were also their competitors in service provision, and they were therefore looking to the regulators to ensure that there was fair competition. Some people had argued that to ensure fair competition there needed to be some degree of separation between BT's network and service provision activities. OFTEL did not agree, but considered that there was a need for a regulatory structure "to ensure fair competition for those entering the market just for service provision." The second main concern was that there was at present no significant distinction between the prices charged to a retail customer and to a service provider for use of the network, even though the latter might be generating a significant volume of business over the network. OFTEL proposed that BT should develop a new series of charges for service providers so that they could access the network at lower rates (Q 44).[15]

4.59 BT pointed out that they had been the originators of many of the ideas which were being mooted for a specific service provision regime (Q 510) and considered that the "market could be further stimulated if there was greater pricing flexibility in the way that BT was allowed to charge itself and others for the provision of service". One of the reasons for BT establishing its own multimedia service provision activities, for which it paid the normal retail price to the BT network, was to allow it to experience buying from the network under the same rules as other service providers (Q 531).

EDUCATIONAL USES

General

4.60 Ofsted stated that reliability, affordability, ease of installation and ease use for all of the necessary technology were critical if the information superhighway was to make a positive impact on schools, teaching and learning (p 255). Taking a wider view, Telecential Communications suggested that education and training (in particular, lifelong learning) would become a prime motivator for the growth of the information superhighway industry (p 294).

4.61 The role for Government, according to Ofsted, should be in evaluating the best educational uses and disseminating the results, establishing quality control, encouraging networks for professional support, addressing the issue of copyright and promoting the training of teachers both initially and inservice (p 257). Aspen Consultancy said that Government should also be active in promoting education at both the early years and the executive level (p 161).

4.62 HeriotWatt University believed that the Internet would have a fundamental effect on education: "Much more responsibility will be placed on the student to organise his or her own study programme, to study at their own pace and submit themselves for examination when they feel appropriate" (p 228). Changes for the university sector were predicted as the quality of an institution would start to be judged on the level of support given to the learning process and on the reputation of speciality subjects.

4.63 In 1995 the Government conducted a consultation exercise on "Superhighways for Education".[16] The priorities established from the exercise are as follows: "raising the general level of IT capabilities in schools, further education colleges and initial teacher training; developing high quality on-line education applications and services; developing the infrastructure of equipment and connectivity. The Government committed itself to: support and encourage the piloting of new communications technologies in education; to make available resources to enable continuing provision of equipment and training; to liaise with industry to promote the development of additional on-line applications and services; and to work with the Higher Education Funding Councils to review progress on the SuperJANET[17] project and to disseminate the outcome as widely as possible. The Government will also look to the communications companies and providers of on-line services to ensure that institutions are not deterred from connecting to networks because of high service or product costs" (pp 288-289).

Level of use

4.64 In March 1996 about 4,500 schools and colleges in the United Kingdom had connections to the Internet (Q 255), mostly via dial-up over normal telephone lines. NCET research conducted in the context of a project with the BBC Networking Club showed that the most popular services were e-mail and World Wide Web access, which offered many benefits for teaching and learning. The NCET said that e-mail offered the possibility of communicating directly with other people and organisations around the world, working on collaborative projects and accessing expertise not usually available. Graphical browsers such as Netscape put the resources of tens of thousands of databases around the world at the finger tips of teachers and learners, through a simple file-transfer operation (p 98).

4.65 NCET said that most of their evaluation of communications technologies had been based on narrow band dial-up over the conventional telephone network. Teachers involved in those projects had spoken of "changes that they have seen in pupils' work and in increased motivation, the greater availability of resources and the greater pride in terms of being able to present work taken from digital sources". NCET was currently involved in managing the evaluation of 21 pilot broadband projects to identify the added value of connections to these networks, within what contexts standards were raised and learning was improved, and to identify the implications for teacher training. NCET pointed out, however, that in other types of information technology use it was relatively simple to set up different sizes of pilot projects and extrapolate from the data thus collected to a wider audience. "When we are talking about networks we actually cannot evaluate how people will use networks until everyone is connected because the behaviour changes when all of the community is connected. When you have only a small number of the community connected people actually do not use the full facilities. So it has posed a particular challenge because we are having to use a leap of imagination to get to the extrapolation" (Q 248).

4.66 NCET believed that schools needed local area networks in order to maximise the benefits of Internet access (Q 258), a point with which the DfEE agreed (Q 282). Ofsted said that "the physical connection of school premises to the Superhighways and the development of a LAN [local area network] within a site to allow access from various rooms, have been implemented in only very few institutions" (p 255). Moreover, usage had often been limited except where interested teachers had taken the lead: "This is partly because of the dearth of material with curriculum relevance on file servers, and partly because physical connection has rarely been smooth and productive in the use of teachers' and pupils' time" ..... "Some are not much farther along the road to smooth working a year after first access to the Internet" (p 255). This and the "mismatch between current realities and the hype" (p 256) were identified as real problems that could easily lead to teachers being predisposed not to use the information superhighway in the future.

4.67 FEDA expressed similar views: "current developments are haphazard in terms of usage because of inadequate coordination and lack of a clear curriculum strategy which a national support programme could provide" (p 223).

4.68 "The NCET called for an out-sourced service for schools whereby they would pay a fixed, subsidised rate for a level of service including a specified band width and support, and possibly including training (Q 257). One commercial service which has already progressed beyond the trial stage is BT's CampusWorld, which is an Internet-based content service developed in line with National Curriculum requirements and currently providing about 18,000 pages of information which both pupils and teachers can access in a closed "walled garden" environment. CampusWorld is a nation-wide service, with over 2,000 schools already subscribing[18] and around 70,000 accesses each teaching day. BT also runs CampusVision using ISDN telephony to enhance remote learning, particularly in areas of the country where teacher provision in certain subjects is difficult and the use of ISDN tele-conferencing can thus enhance teaching capability (QQ 519-524).

4.69 The Institute of Physics said that the advantage for schools of on-line connections via the Superhighway as opposed to CD-Roms was that the latter could become outdated quickly, whilst on-line connections could be used to provide up-to-date information. "It is very important that children do learn about developments which are happening currently within science ... for too many years we have taught physics in schools which is largely 19th Century and only peripherally 20th Century and that must change" (Q 721). The Royal Academy of Engineering said that "in many schools the high cost of books has led to "one textbook" courses. It would encourage sixth form and university students to take a wider view if textbooks were available (for a comparatively affordable charge) on the World Wide Web" (pp 276-277).

4.70 ASLIB called on the Government to encourage partnerships and, where appropriate, to provide pump-priming funding to raise the investment to improve the educational infrastructure. They also wanted the information infrastructure included in the National Curriculum (Q 183), as did the NCET (Q 264).

4.71 Perhaps the widest use of online services and networks for educational purposes in the United Kingdom is by The Open University. Currently 15,000 (10 per cent) of their students and 1,700 tutors (25 per cent) were said to be registered to access online services hosted at The Open University or available on the Internet. These figures were expected to increase to 100,000 (66 per cent) and 3,700 (52 per cent) respectively by the year 2000 (pp 613-614).

Affordability

4.72 The Open University also identified cost to the student and the cost of training as significant barriers to the use of computer technology and network communications in education. The Open University was anticipating that its own expenditure on just online support services could be in excess of £5 million by the year 2000 (p 614). To support homebased learners, The Open University suggested, amongst other ideas, that an "`educational services' 0345 number at reduced tariff" could be offered to reduce the cost of network access (p 615).

4.73 The costs to schools (in particular "fear of the potential cost of telephone connections" p 223) were identified as a major barrier to the uptake and use of the information superhighway in education. Ofsted stated: "In almost all the examples cited of largescale use of telecomms by schools the telephone charges had been either waived or heavily subsidised" (p 257). "Whatever the tariff for access, it needs to contain safeguards which allow the cost to be effectively and responsibly controlled by the institution" (p 257). Ofsted favoured the use of a levy mechanism on existing superhighway users to provide access to remote areas, and also to ensure that educational institutions were offered attractive use tariffs (p 257). The Further Education Development Agency (FEDA) suggested that "A `map' of the highways and a clear `fare' structure would encourage purposeful travel" (p 223). FEDA also said that "a further education version of HE's [higher education's] JANET and SuperJANET would secure more equitable access" (p 224).

4.74 In the USA there is regular cross community support within the education sector and UCISA said that, as a result, schools were much better provided for in the USA than in the United Kingdom. UCISA identified the problem: "A more significant factor [to lack of money], which has inhibited HE from assisting other communities, has been the strict adherence to the constraint imposed by Government funding rules, which mean that facilities provided from the HE budget cannot be used to support other communities" (p 298). The Open University also expressed support for a change in the funding of the Higher Education network infrastructure and said that: "The Government could do more to foster a culture which acts against the current `Cinderella syndrome' where delivering relatively low technology solutions at industrial strength to a mass audience is seen as less important than delivering advanced technology to a few" (p 614).

Teacher training

4.75 Microsoft identified a need for teachers "to be skilled up in the utilisation of the PC and the Information Highway as a tool for teaching" (Q 368). Such activities are already underway where the value and potential of the information superhighway have already been identified. At The Open University, for example: "Both students and tutors are being taught useful IT skills and are gaining competencies in information management. The tutorial staff are also receiving training in effective teaching using the new communication technologies" (p 614). The Chief Executive of the NCET said that she could not "imagine how we can still be undertaking initial teacher training without making IT a clear pillar of that training ... It should be relatively simple to catch teachers in their initial teacher training stage. That is one of the easier things to do if we had a mind to do it." She advocated giving portable computers to teachers so they could use them in the privacy of their own homes (Q 262).

4.76 The Department for Education and Employment (DfEE) said that it was now a requirement of all courses of initial teacher training that they included elements of IT usage and experience (Q 281). The DfEE was running a pilot programme to equip over 1,000 teachers with multi-media portable computers to enable them to improve their skills in private and to explore the use of computers in the curriculum (QQ 266, 284-285). The DfEE pointed to the responsibility of the Teacher Training Agency in this area, and hoped that "we may see some movement towards teachers themselves, in the context of lifetime learning, perhaps taking on more personal responsibility for updating themselves and more use of their own time" (Q 284).

4.77 The Teacher Training Agency (TTA) said that "there is a general need to raise the IT capability of teachers if we are to make a reality of the superhighway", and also that, "school leaders need to be trained in both the curriculum and administrative potential of IT and related technologies" (p 293). The TTA highlighted problems with the present training situation for teachers: "in all key stages IT teachers command of their subject lags behind when compared with the command other teachers have in their subjects" (p 293). The picture for Key Stage 2 was particularly poor with only 31 per cent of IT teachers being graded as very good, compared with a figure of 50 per cent for all subjects. At Key Stage 4, 67 per cent of IT teachers were graded as very good, compared with 86 per cent for all subjects (pp 2934).

4.78 The Institute of Physics said that many teachers, particularly in primary schools, had little knowledge of science and were therefore in need of considerable training effort since science was now part of the National Curriculum at primary level. The Superhighway could also be used to help keep secondary school teachers up-to-date (Q 726).

Industrial training

4.79 Several witnesses emphasised training as a priority area. The Heads of Departments and Schools Committee of BAILER, for example, said that a great deal of industrial training could become computer-based. It predicted that the existing commercial companies in the industrial training sector would move into cyberspace and be either followed or led by the large management consultancies and the computer software houses, such as Microsoft, which already had considerable computer-based training resources themselves. Microsoft, for example, was already offering training in computer subjects through its Microsoft Academy on the Microsoft Network (p 571).

4.80 The DfEE said that development projects by the Department and others had shown how technology-based training could provide high quality learning, accessible at a time and place to suit the learner or the employer. New technology could also, through enhanced simulation technologies, offer a quality and range of training which was unachievable by conventional methods. In 1995 the Department had announced a new Innovation in Training Initiative, which would help Training and Enterprise Councils in particular to develop flexible learning methods based on the newest technologies in their own programmes and to establish local access to advice and information on such methods, especially for small firms (p 583).

SuperJANET and academic use

4.81 The Joint Academic Network (JANET), which is not a "superhighway" as it is of limited bandwidth, offers extensive coverage by connecting more than 50,000 computers including all higher education institutes (HEIs), the Research Councils and some industrial sites. It allows email, access to remote computing facilities and information services and access to the Internet (p 288).

4.82 There is currently only one educational broadband information superhighway operating in the United Kingdom and that is SuperJANET, which was started in 1993 and is funded through the Higher Education Funding Council. SuperJANET is capable of handling real time multi-media traffic enabling the transmission of sound and video as well as text and numeric data (pp 97, 288). SuperJANET covers some 130 sites in higher education[19] and research and is due to expand further (Q 289). The Library Association said that the national libraries, which had access to JANET, were making increasing use of the network to deliver and promote their services. The National Library of Scotland, for example, was making available unique databases such as the Bibliography of Scotland (p 252).

4.83 ASLIB called on the Government to make JANET and SuperJANET more widely available to industry (QQ 184-191). The British Library, which is connected to SuperJANET itself, said that "there is a need for citizens of this country and for major institutions in this country to have access to SuperJANET or something like SuperJANET" because it provided access to a huge amount of information very quickly (QQ 219-224).

4.84 The DfEE said that a number of further education colleges were being connected to SuperJANET, as they had become more involved in the provision of higher education. Researchers in higher education used SuperJANET to form international links with other researchers and to access large information data sets. Extending SuperJANET "too widely", for example to schools, "might mean that it would cease to meet the needs of higher education and research and also perhaps at the same time it would not actually meet the needs of schools or other interested users" (Q 291). The higher education sector already considered that it had insufficient band width for all the international connections it wished to make, and additional users would create "even more demand for those services and the chances are that no-one is going to be satisfied." (Q 296) The DfEE also drew attention to concerns which had been expressed by companies supplying networking services commercially, who were "extremely reluctant to see SuperJANET broadened to wider usage outside the HE sphere" (Q 294).

4.85 The Institute of Physics (IoP) said that British academic traffic had insufficient protected bandwidth to support national research programmes. The United Kingdom was probably the only European country which connected to the laboratory at CERN (European Organisation for Nuclear Research) only via Europa-net, in contrast to other countries which had used leased lines to supplement Europa-net. For its publishing operations, the IoP used commercial Internet providers rather than JANET, so it could readily compare the two services. It believed that for international Internet connections the academic community was getting a poorer service than commercial users (QQ 691-692). Partly as a result of EC funding, an increasing number of scientific experiments were conducted on an international basis, making the ability to communicate with colleagues overseas an essential working tool (QQ 714-717).

4.86 The Universities and Colleges Information Systems Association also complained of the constraints placed on the United Kingdom Higher Education sector playing its part in the international community by the restricted capacity of international bandwidth (p 298). The Scottish Office said that "in the recent Government Consultation "Superhighways for Education" many HEI responses identified a lack of international connectivity (especially to the USA) as a growing problem. The narrowness of international bandwidth, in addition to increasing Internet traffic is resulting in increasingly slow data transmission" (p 288).

4.87 The Royal Society of Edinburgh said that the whole of Scotland was now covered by four Metropolitan Area Networks (MANs) linking Scottish Higher Education Institutes whereas England and Wales were still only partially networked. The MANs offered new opportunities for co-operation and collaboration between institutions, including support for a national electronic library, distribution of televised lectures and the sharing of computer-based teaching and learning materials. Students could be provided with the facilities for "self-paced, supported learning" (p 285).

Life-long and distance learning

4.88 The Further Education Development Agency said that both "staff and students require information technology core skills for sustained employability" (p 225). The Policy Studies Institute said "information handling skills, in the broadest sense, need to be an explicit part of the national curriculum" (p 264). The University of Leeds was more specific and called for computer literacy skills to be replaced by "information literacy", as this would be the key educational and training issue of the new millennium (p 303): "Without it being seriously addressed and adequately resourced, the users of the Information Superhighway will be as disenfranchised as if they had been set free in a library without ever having been taught to read and write" (p 303). The CBI made a similar comment, highlighting the importance of skills training: "what is the point of universal access for someone who does not understand how to use a service or what to use it for?" (p 194).

4.89 ASLIB said that they had recently launched a distance-learning package which would go on to the Internet and enable them to reach "anyone in the world at very low cost with training and education" (Q 132).

HEALTHCARE

4.90 The British Medical Association (BMA) highlighted three main types of application for the information highway in medicine. First, there were the library aspects of service provision, where access to information was provided through the World Wide Web or through Medline. Secondly, there were administrative applications, for example transferring contract data between purchasers and providers. Thirdly, there were the clinical aspects, including managing communications between one doctor and another, for example communications between a General Practitioner (GP) and a consultant using telemedicine or, more simply, sending an electronic referral letter from a general practice to a hospital and receiving a discharge letter in the other direction. Dr Ross Anderson, a Consultant to the BMA and Lecturer at the University of Cambridge, told the Committee that it was the "very simple aspects of the information superhighway such as electronic mail between general practice and hospitals which probably have the greatest potential for bringing real short term gains. I have no doubt that in the medium to long term there will be a lot of gains to be had from telemedicine but right now working secure e-mail systems will probably bring the most benefit" (Q 409).

4.91 The Department of Health also emphasised the administrative benefits of electronic communications in the National Health Service (NHS). They stressed the benefits for patient care of, for example, a GP being able to receive the result from a hospital pathology or radiology department as soon as it had been produced. They also believed that using e-mail for messaging and transmission of forms in the NHS "could save at least £100 million a year ... and that buys an awful lot of hip replacements" (Q 433). The Department of Health estimated that about 25 per cent of dentists were already making item of service claims electronically, and 66 per cent of "computerised general practices" were doing patient registrations electronically "and most of those are now moving on to make their item of service claims electronically" (Q 435).

4.92 The Royal College of Nursing (RCN) listed a number of possible examples of administrative applications of electronic communications which could be of direct benefit to patient care. These included improvements in communication between multidisciplinary teams such as care programmes for mentally ill patients, and rapid dissemination of urgent information such as drugs to be recalled. The RCN pointed out that current methods of disseminating urgent information in the NHS had recently been questioned. Following the confusion caused by the attempt to disseminate information about the potentially harmful effects of some contraceptive pills in October 1995[20] the Department of Health had agreed to review the information systems used to issue new health warnings (pp 282-283).

4.93 Several witnesses mentioned telemedicine as one of the potential benefits of the Internet (Q 435, p 283). Examples of telemedicine include the use of a specialist service to a remote dermatologist by a GP's surgery in Wales, and the academic department at Manchester Royal Infirmary training surgeons using virtual reality at a distance. The BMA said that telemedicine had particular benefits in relation to medical conditions which could be diagnosed by sight rather than touch, and looking in orifices which were not normally exposed, for example dermatology, endoscopy and laryngoscopy and similar procedures. The benefits were greater when the distances involved between the locality of the GP and the specialist were greater, for example in Scotland and Wales, or if the traffic was bad in some parts of the South West of England (QQ 409, 413-414). Whilst acknowledging the notoriety which some Internet support groups had attracted, the BMA drew attention to the potential benefits which these groups offered by giving patients and trauma victims from all over the world the opportunity of discussing mutual problems whilst retaining their anonymity (Q 418).

4.94 In the United Kingdom over 90 per cent of GPs have computers in their surgeries and over half of those use computers in their consulting rooms--"probably the largest single group of clinicians anywhere in the world who have ... found a ... practical benefit for patient care in the daily use of computers and information technology in the context of the consulting room" (Q 408). Only a small percentage of these computers are currently connected to an external network, at least partly because of concern about the confidentiality of personal health records.

4.95 Lack of critical mass does not appear to be the major barrier to the development of a British information highway in medicine. The BMA identified the need to legitimise the computerised medical record as one of the main impediments to progress. It has been part of the terms of service of GPs that they must make records on paper (QQ 408, 410). The Department of Health, whilst agreeing with the significance of this legal constraint (Q 436), said that "the major barrier in many places is the willingness of hospitals to allow it to happen" (Q 444).

4.96 In an ideal world, an official from the Department of Health thought that more financial resource for GP practices would be the single most important key to increasing the rate of uptake of IT in the health service. "We know exactly what we require in a practice to enable all these things to happen and because there are so many GP practices that is where the major costs lie. So if I could wave a wand I would invest about £5,000 in every GP practice in the land and connect them to the NHS wide networking system" (Q 446). He also recommended on-line booking of outpatient appointments: "that is something I think the NHS needs to have. If you can book a holiday anywhere in the world then it is about time that you can book an outpatient's appointment before you leave the GP's surgery" (Q 433).

4.97 One of the main concerns raised by the Royal College of Nursing (RCN) was security. The RCN said that the NHS needed to communicate with social services and the private sector and patient information would need to be transferred to these agencies. "However the standards within the NHS Wide Network do not apply to local authorities and the private sector. The RCN is concerned that the same stringent standards must be applied if the security of health related information is not to be compromised." One of the problems identified was the lack of a formal approval process for software used throughout the NHS: as well as causing problems for compatibility this also raised concerns over whether data could be protected from corruption and unauthorised access. In addition, "the guidance issued by the Department of Health only considered the threat from external (to the NHS) unauthorised access" and the RCN said that there was also a risk from `internal' unauthorised access and use of patient information. The RCN called for encryption to be used to protect the privacy of patient information and suggested that it was a role of Government to provide a framework for security standards (pp 281-283).

4.98 The University of Warwick also suggested that it was a Government role to ensure that privacy in general could be maintained where necessary (p 306). The University of Leeds suggested that while the concerns of the NHS about security of information were understandable, they were at present "unnecessarily constraining on the potential for interconnectivity with other parts of the public domain" (p 302).

4.99 The RCN considered that US software had already had a negative impact because of the marked differences between the nursing cultures of the US and the UK. "In the UK the dominance of US based nursing information systems has already damaged nursing's attitude to IT". It called for "an agreed `core specification' for nursing and health care information systems" which would focus on the relationship between the nurse and the client. At present most of the software in use was more suitable for contracting and meeting patient charter standards rather than supporting patient and client care (p 283).

BUSINESS USE

4.100 Application and use of the Internet in British industry lags behind its use in the United States.[21] In 1995 it was estimated that 37 million people aged over 16 in the USA and Canada had Internet access, of which 2.5 million produced goods or services over the Internet (Q 661). According to figures from the American Physical Society, of the 132,000 registered domain Internet addresses in the USA 120,000 are for industry and 2,000 for universities. The Institute of Physics is working to help industry, particularly small and medium sized enterprises, to use the Internet for technology transfer, networking and finding trading partners (Q 727).

4.101 The Chairman of the Technology Foresight Information Technology, Electronics and Communications (ITEC) Panel saw the Information Superhighway being "as essential as the phone for the economy over the next few years". He cautioned, however, "that the technology should be thought of as essentially disruptive to many, if not most, enterprises ... if you imagine buying a music CD in the UK at the moment. If you spend about £12 or so, something like £5 of that £12 is for physical distribution. If you could distribute it electronically across some kind of network, then whoever was consuming that £5 on trucks, warehouses and so on is going to find things quite disruptive ... When the means of production are increasingly brain powered, the way in which we organise business around brain power as the key asset is going to be a real dilemma in the information age ... understanding how to master this technology is going to be ... crucial to the way the economy in a high value adding, developed country is going to operate." (Q 658)

4.102 Microsoft highlighted the fact that the Internet represented "a real opportunity for British business, particularly in the software and media fields, to reach world markets without having to partner with a distribution organisation in North America or Asia". Corporate Local Area Networks could create "an incredible number of opportunities to improve productivity and empower departments" ((Q 368). ASLIB suggested that there might be a dedicated United Kingdom Internet for business, pointing out that trading on the Internet was rising rapidly and was "a fraction of the cost of trading in other ways" (QQ 165-6).

4.103 NatWest has been involved in the East Anglian trials using broadband networks. It said that with electronic delivery methods companies offering direct line financial services to customers might enjoy a competitive advantage as compared to those companies with a large branch network to support. NatWest could already "down-load electronic cash into your home over a Mondex terminal, so in theory most of the basic transactions satisfy more than 80 per cent of our requirements and can be accomplished now, almost totally automatically without the need for a physical high street presence." NatWest's duty of care to its employees and sense of "responsibility to ensure that as far as possible we maintain employment" placed a break on the speed at which such a change would take place (QQ 580-583).

4.104 NatWest also drew attention to the fact that "the mere existence of the Internet allows consumers to find financial institutions elsewhere around the world, and ... to enter into a relationship with them ... there is a need to ensure that the regulations governing the operations of banks and accreditation of banks and financial institutions are monitored and are implemented to protect the consumer" (Q 581).

4.105 The Newspaper Society said that the on-line edition of the Irish Times had been "very, very successful simply because there are so many expatriates". The Irish Times' research had suggested that expatriate Irish people were prepared to pay for such a service "if the price is right" (QQ 340, 345). There were, however, few British examples of local publishers making money from on-line services. One successful initiative by Northcliffe Newspapers was Autonet, which was a classified advertising service for motors in the south west of England (Q 345).

4.106 Patents are now published in both digital and paper form, and in a few years' time will be published only in digital form. The British Library already has a collection of over one million patents held in electronic form (Q 206).

4.107 A recent report by the Robert Gordon University Aberdeen on The Intelligent City: electronic information and its potential in the provision of health and safety information in the oil and gas industry found that oil and gas companies appeared to be technologically constrained not only by considerations of security, but also by the limited awareness of key personnel. The report identified three categories of staff:

    --   "the IT managers, who have a detailed understanding of Information Technology and the ability to influence corporate investment in it, but who have limited awareness of the specialist information needs of the staff of their companies, and of the information resources, particularly external information, available to meet those needs

    --   the specialist managers, in this case the health and safety managers, who have an understanding of the specialist information needs of the companies, a limited awareness of the information resources available to meet those needs, and the ability to influence corporate investment in it, but who have little understanding of the potential of Information Technology

    --   the Librarians, who have an understanding of the specialist information needs of the companies, an awareness of the information resources available to meet those needs, and some understanding of Information Technology, but who have little influence over major issues of corporate policy and investment.

There was little evidence of a developed strategy involving all of these employees. As we move from the so called `post-industrial Society' into the `Information Society', this paradigm of expertise and responsibility becomes questionable."

4.108 The Intelligent City report concluded, first, that a fundamental re-assessment of the training of IT specialists was necessary, with a view to broadening their understanding of the role which information played in organisations and of the information resources available.[22] Secondly, more attention needed to be paid in the education and training of both general managers and specialist professionals to developing an understanding of how people and organisations use information, the relevance of electronic databases to meeting information needs, and to means of organising or accessing information. Thirdly, general managers needed to be better equipped to appreciate the need for and the possible components of a corporate information strategy. Finally, the education of librarians and information scientists needed to place greater emphasis on the promotion and development of corporate information strategies, user needs analysis and evaluation and consolidation of information.[23]

Home shopping

4.109 The CBI said that use of the Internet for retail had not yet reached its full potential. Thousands of companies advertised their goods on the Internet, often reaching new customers inexpensively, but the actual volume of transactions remained modest as security of transactions remained a major concern. As this problem was overcome, however, there might be many new opportunities for niche suppliers as well as major retail groups. There were also considerable opportunities for manufacturers to communicate directly with their customers, allowing them to determine precise needs, tailor products to the individual and market directly to the consumer (p 193). The CCA pointed out that shopping was partly a social activity (Q 55).

4.110 QVC (a shopping channel on cable and satellite television) considered that the widely available tools of the telephone and television presented greater sales potential for mail order shopping in the immediate future than the Internet. Although in the United States some 80 per cent of QVC's audience had never made a purchase from QVC, mail order was expected to become more popular, partly because of the increase in the numbers of "working women". "Time poverty is much more of a consideration nowadays. In addition to that, we know that there are more people who are less mobile, older people, women with babies who are at home, so the demographic changes that are taking place will make mail order more attractive to more people and so it should have a large penetration. However, anybody who thinks that this or QVC is going to be the death of traditional high street retailing is kidding themselves. It will have a very, very small effect on high street retailing" (Q 844). The profit margins available in the supermarket trade were so small as to make non-specialist grocery shopping via the Internet uneconomic (Q 846).

4.111 However, CompuServe said that their electronic shopping area, which in 1995 had been expanded to include the UK, had been "very successful", with £1½ million worth of retail sales in the shopping area in one year with 700,000 visitors in the area and an average order value of £45. They considered that ingrained habits were inhibiting the growth of online shopping rather than the supposed insecurity of online transactions (QQ 772-781).

EMPLOYMENT CONSEQUENCES

4.112 The Chairman of the Technology Foresight ITEC Panel emphasised that there would be both positive and negative employment consequences arising from the Information Society. On the positive side, "it is a wonderful opportunity for business in the UK, small, medium and large, to reach many new market places internationally, to reach new kinds of consumers, to serve enterprises in other countries and so on, so it is an excellent opportunity for knowledge workers, for brain power, really just to get on with it. Access like that is going to be very important, so the UK could become one of the best places to have brain power businesses. That key question of why do you not set up this particular piece of value adding business activity in the UK rather than anywhere else is going to be a central question for our Foresight Panel. I think it is a central question for the UK economy and for UK politics. ... On the down side ... it is a wonderful way for businesses in other countries to come and access domestic markets here and supply them. It is a wonderful way for businesses here to out-source functions to overseas suppliers. It is a great way to export jobs." (Q 687)

4.113 CCTA, the Central Computer and Telecommunications Agency, quoted the current US administration's view that "information is one of the nation's most critical economic resources. Estimates are that two thirds of US workers are in information-related jobs and the rest are in industries that rely heavily on information." CCTA said that "it is not unreasonable to assume that this estimate could apply to Britain. In which case the Information Superhighway, which provides the means of accessing and transmitting much of this information, becomes vital ... The Information Superhighway is key to delivering electronic government that will soon operate in ways that the most visionary planner could not have imagined five years ago" (pp 176-177).

4.114 The IDPM said that information technology had led to the "implosion" of corporate career structures (p 239) and that this had had a major impact on employment. Job losses had occurred in banking, administration and clerical sectors and there was more to come: "The potential for many ITrelated jobs to move offshore cannot be overstated. If the task can be adequately specified ... an Indian Software house may already be able to bid at 2025 per cent of the UK/US price for comparable quality" (p 241).

4.115 Aspen Consultancy gave a graphic example of how the work of a high tech distribution company could be replaced by electronic means, thus negating the need for the company itself. The term "marketspace" was coined to describe how jobs would disappear down to a few crucial points (many of which could be overseas) while the rest of the business was conducted electronically (p 161).

4.116 In relation to employment prospects and problems, ICL said: "It would assist the UK greatly if targeted awareness programmes were addressed to the areas of greatest threat and opportunity." ICL emphasised the potential of broadband technologies for assisting teleworking, which it thought would "become an increasingly real option for many people" (p 231).

4.117 The CBI also focused on the need for planning so that the employment consequences of the Information Society in the United Kingdom were managed in an orderly fashion. "There is large potential for growth in employment in the Information Society, albeit in new forms and types of employment for which education and training will be required. At the same time in the UK there is a threat to traditional sources of employment in manufacturing and the production of material goods due to the newly developing Asian economies based on their lower wage and social cost structures. It is particularly important therefore to manage this change to avoid social upheaval and the consequential cost. Government policies, both economic and social, should take account of the need for time to implement the considerable changes implied by the development of the information society (p 195).

4.118 The Technology Foresight ITEC Panel emphasised the need for large numbers of skilled information technicians. Furthermore, "if this technology really is going to be pervasive in society then most of our citizens will need to be literate in those sorts of skills." (Q 687)

Teleworking

4.119 The BCS was among several witnesses[24] who stressed the potential benefits of teleworking: "this can have enormous impact in the need for expansion in the physical transport infrastructure which is very expensive--much more so than the cost of a high bandwidth communications infrastructure--and environmentally damaging." The BCS recommended speeding up "the realisation of this potential" by incentives for individuals to use a part of their home for remote working and, "for people who do not have the space, the provision of local telecommuting centres removing the need for a long commute. Such centres could be a regular feature of all suburbs and villages" (p 170).

4.120 The CBI said that there had already been considerable growth in teleworking, which could accommodate both full-time and part-time employment, allowed much more flexibility than traditional forms of working and had the potential to help revitalise depopulated communities. It warned, however, that the trend should not be over-emphasised. "Many business tastes are unsuited to relative remoteness from customers, suppliers or colleagues. Moreover, many employees prefer to work in physical proximity to their colleagues" (p 195). The ESRC said that the recent literature on changing working practices suggested that various forms of teleworking were unlikely to grow significantly in the absence of major and widespread adjustments in lifestyles, support services, etc. (p 213).

4.121 IDPM distinguished between what it saw as the advantages of "flexiworking", working from a home office linked to the corporate systems but having regular physical meetings with colleagues or customers and using company premises and facilities for what could not be done economically from home, and "the teleworking trap", where the individual did not regularly communicate other than electronically or by post (p 240). The Library and Information Commission said that there was "a feeling in some quarters that teleworking is being promoted by the telecommunications and IT industries, which stand to benefit from equipment sales, but the economic benefits have not yet been proved" (p 250).


1. Evidence from Dr Alan Rudge of BT, Q 546. Back

2. We are grateful to On-Line Media for enabling us to visit the Cambridge On-Line trial, and to BT for demonstrating the Ipswich trial at their Martlesham Heath Research Laboratories. Back

3. The Committee received various different estimates of PC ownership, Internet usage, etc. Back

4. Microsoft's estimate was that 200 million people would access the Information Superhighway by the year 2001 (Q 397). News International cited a similar estimate (Q 961). Back

5. When this report went to press, BT were offering, for a limited period, free ISDN connection to the Internet, and a special offer on ISDN subscription charges. Back

6. House of Commons Debates, 17 April 1996, cols. 705-6. Back

7. The Director General of OFTEL thought that "the economics of the cable industry will restrict commercially sensible investment to perhaps 85 per cent" (Q 1034). Back

8. All Northern Ireland Departments were asked if there was anything unique to Northern Ireland which the Northern Ireland Office might wish to bring to the Committee's attention, and they all responded with nil returns (p 613). Back

9. The part of the telephone network from the home to the exchange. Back

10. Information Superhighway. Back

11. Footnote to Q 1036. Back

12. National Consumer Council, The Information Society: Getting it Right for Consumers (London, April 1996), 67-68. Back

13. ASLIB pointed out that two-thirds of the population used public libraries already (Q 136). The Library Association said that public libraries had not had the same opportunities or funding for access to the Internet as had been available in the academic sector, and this had adversely affected public library access to information (p 252). Back

14. Ofsted supported a similar levy mechanism (p 257). Back

15. Since OFTEL's first session of evidence to this enquiry the Director General proposed licence amendments for BT's and others' licences (Q 1032). Back

16. The consultation paper can be accessed on the Internet at:
                      
http://www.tsoinfo.gov.uk/document/supered/supered.html

The results of the consultation exercise were published in Superhighways for Education: The Way Forward, which can be accessed at:
                      http://www.tsoinfo.gov.uk/document/supered2/supered.html
Back

17. For which see paragraphs 4.82-4.84 below. Back

18. BT hope to have 8,000 schools subscribing to the service by the end of March 1997 (Q 522). Back

19. Not all higher education institutions are connected to SuperJANET (p 288). Back

20. The BMA also referred to the "third generation Pill scare" and the subsequent sharp rise in the number of abortions (Q 423). Back

21. A significant proportion of Internet use is for recreation. CompuServe pointed out that 60 per cent of the traffic on their network was in the evening. They said that "most of the growth in this whole industry is on the consumer/leisure side and not so much on the business side" (QQ 750, 753). Back

22. "Group Ware" software such as Lotus Notes and MS Exchange can help to keep different parts of organisations, for example research, marketing and sales departments, informed about each other's activities, to their mutual benefit. Back

23. JM Smith, JW Murdoch, IM Johnson and RC Marcella, The Intelligent City: electronic information and its potential in the provision of health and safety information in the oil and gas industry, Report to the British Library Research and Development Department (Robert Gordon University, Aberdeen, 1996), pp 68-70. Back

24. Eg, pp 189, 195, 264, 280, 295. For further background information see also the Report by the Parliamentary Office of Science and Technology, Working at a Distance - UK Teleworking and its Implications (June 1995). Back

 


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