Phones levy to pay for broadband boost

A levy could be established on all fixed telephone lines to pay for an independent national fund to ensure "maximum next generation broadband coverage".

The Digital Britain report proposed a 50p-a-month levy on all fixed telephone lines. This money would go to an independent Next Generation Fund that would provide subsidies for operators to deliver super-fast internet to areas where it would not normally be commercially viable.

The Culture Secretary Ben Bradshaw also said that the Government intended to upgrade all national radio stations from analogue to digital by 2015.

He further announced that the Government would legislate to curb unlawful "peer-to-peer file-sharing" of digital content. Furthermore, it would implement a new more robust system of content classification for the video games industry.

The Digital Britain report, compiled by Communications Minister Lord Carter, included a pledge that every home in Britain would have access to two-megabits-per-second broadband by 2012.

This will be achieved using £200 million in public funds left over from the digital switchover help scheme.

Communications regulator Ofcom will be given new powers to clamp down on people who persistently download music and films from the internet illegally.

This is aimed at reducing unlawful online file-sharing by 70 to 80 per cent.

But Geoff Taylor, chief executive of the British Phonographic Industry, said the report had failed to speedily implement more effective measures, accusing it of "digital dithering".

Mr Bradshaw said: "Britain's digital industries are among the most successful in the world. The global technological revolution means if we make the right decisions now they will continue to grow and Britain will continue to prosper from them."

Mr Bradshaw acknowledged that the ease with which modern digitised content can be copied makes it "increasingly hard to convert creativity and rights into financial reward".

He said: "Developing legal download markets will best serve both consumers and the creative industries. But we will also legislate to curb unlawful peer-to-peer file sharing."

Ofcom will be given a new duty to cut down on the activity including obligations to notify people carrying out unlawful activity and release the identities of serial infringers to enable legal action by rights-holders.

Serial music and film pirates could also have their bandwidth reduced by Internet Service Providers (ISPs).

He reaffirmed the Government's commitment to universal access to today's broadband services but warned that, left to the market, the next generation of super-fast networks would only cover two-thirds of the country.

Telecommunication prices have reduced "significantly" in recent years and are expected to carry on falling, Mr Bradshaw said.

"We have concluded that the fairest and most efficient way of ensuring that people and businesses are not left out is to use some of that saving in the form of a small levy on all fixed lines to establish an independent national fund which will be used to ensure maximum next generation broadband coverage."

Internet entrepreneur Martha Lane Fox, who founded Lastminute.Com, will be the new "digital inclusion champion".

Public services "will be delivered primarily online and electronically" in the future "making them quicker and more responsive to the public while saving money for the taxpayer".

The report was written by Communications Minister Lord Carter of Barnes, who last week announced he is to quit his post and leave the Government next month.

Mr Hunt told the Culture Secretary: "With Lord Carter's surprising and rather hasty departure from the Government, it is now you, less than a fortnight into the job, who must now pick up the baton in an immensely complex but vitally important area for the economy."

Earlier Gordon Brown pledged to transform Britain into the "digital capital of the world" as he paid an early morning visit to a broadcast and mobile communications firm ahead of the launch of the Digital Britain report.

The Prime Minister toured the Arqiva site in Crystal Palace, south-east London, which is home to one of Britain's 50 high power transmitters.

The Prime Minister was joined by Business Secretary Lord Mandelson, Ben Bradshaw, the new Secretary of State for Culture, Media and Sport and Lord Stephen Carter, Minister for Communications, Technology and Broadcasting.

The group were shown examples of analogue television and radio transmitters inside the firm's headquarters and met two young apprentices, before going outside to view the 750ft tall broadcast mast which services 12million homes across greater London.

Speaking about the significance of today's Digital Britain report, which will set out the Government's plans for the future of the internet and communications industries, Mr Brown said: "Britain is going to lead the world. This is us taking the next step into the future, being the digital capital of the world. Making the investment that is necessary, but making sure that no family, no household, no business misses out. Every business will have access to fast broadband and the report today makes it possible for this to happen in the quickest time.

"Britain will be the broadband capital, Britain will make the investment that is necessary and every citizen in Britain will benefit from the fast connections."

He added: "I think what we have done is brought together all the providers in the area. We have harnessed the new technology, we have looked at what is possible for the country, so we can have universal services provided to every citizen in the country. They can get fast interactive broadband, that will mean they can use all the services possible throughout the country. People will be looking at what we can do and they will say Britain is leading, but they will also say that nobody is going to be left out."