BT Suggests that Mobile Phone Users Should Help to Spread the Cost of the Broadband Tax

In the Digital Britain report published last month Lord Carter who is the Communications Minister proposed a 50p per month tax on all fixed phone lines. The aim of the 'Broadband Tax' is to help cover the costs of providing high-speed broadband to the nations computers.

What is needed in order to improve our broadband infrastructure is nothing short of a complete overhaul. The current copper phone lines were not designed to transport large amounts of data at high speed, they were designed to handle voice calls. The problem is that there is some debate about who should be paying for the new system.



BT has suggested that in order to reduce the tax per customer more people should be taxed. Their solution is to place a tax on mobile phones as well. Some of the £1.5bn which is expected to be raised by the tax may be available to mobile operators as well as fixed line companies as they are both able to join the bidding process for a share of the funds.

BT's director of industry policy and regulation (snappy title!) Emma Gilthorpe has said "the government should consider the opportunity to widen the base for the tax and possibly reduce the amount that each individual household pays". The problem with this theory is that most households own a combination of a fixed line and several mobile phones so in the end the same people may be paying the same amount as they would with the standard fixed line tax.

Those without a fixed phone line, mobile broadband customers for instance, might end up paying towards the improvement of the infrastructure if BT's proposals are considered.

Is The Recession Boosting Mobile Broadband Sales?

Mobile broadband continues to attract new customers, it's growth unhampered by the global recession. A report by the EITO (European Information Technology Observatory) has predicted that the UK wireless communications market will grow by 6.6% in 2009.

“Thanks to new applications and attractive devices, mobile telecommunications remains a growth market in spite of the economic crisis“ EITO-Chairman Bruno Lamborghini

The UK is leading the charge with the highest growth rate in Europe with mobile revenues expected to grow by 3.8%. Internet browsing is having a massive impact of mobile phone design as the increase in average screens size shows. Mobile browsing capabilities are now becoming the most important feature for many when looking for a new phone.

Mobile broadband provides a lower cost alternative to traditional fixed line broadband due to lower monthly data costs and lack of line rental fees. Those looking for short term or more flexible contracts are turning to mobile broadband. Improvements in the 3G infrastructure have reduced the difference in connection speeds between mobile broadband and fixed line connections. The availability of pay as you go mobile broadband deals mean that those with lower monthly usage levels are able to take advantage of lowers costs based on their exact usage.

Some of the best mobile broadband deals offer free laptops as part of a monthly subscription and this has no doubt helped to boost take up. Getting online is now a similar process to getting a mobile phone contract and younger users are more comfortable with this than with fixed line subscriptions.

Being the lower-cost alternative has been good more mobile broadband companies with the recession changing the face of the industry. The ability to spread the cost of buying a laptop appeals to customers who feel less financially secure.