As reported in the Guardian and FT (via Wadds) the minister for communications, technology and broadcast, Stephen Carter, is planning to prepare a report called Digital Britain which, according to the FT, will help reboot the UK’s battered economy from the credit crunch.
Backed by business secretary, Peter Mandelson, the Digital Britain report will address how to fund public-service broadcasting, super fast broadband and at its core an ambition to accelerate the rate of growth, and cement the UK’s position as a world leader in the knowledge and learning economy.
I’m sure funding won’t be a problem. A couple of billion here, a couple of billion there.
Now that the City has pretty much had its day is this the dawning of a new kind of era in Britain? According to the Telegraph, Mandelson’s plan is to introduce a new economic framework that relies less on the financial services industry and can take advantage of globalisation and the doubling in size of the future global economy.
In my opinion Britain is one of the best countries to be placed as a digital hub of innovation. Here’s why:
Size – The UK is a small but densely populated island. Building new technical infrastructure to harness innovation would be less of an issue compared with much larger countries. Super fast broadband would be relatively cheap to implement. (Relative to the money that we the taxpayer have had to pull out to bail out the greedy bankers)
Wealth – Although only a small island (which always punches above its weight, mind you) the UK is still one of the richest countries with the fifth biggest economy in the world (according to the Economist).
People – The UK’s economy is already service based with circa 70% of GDP generated by the service sector. Making the transition (if there is one to make) should be relatively smooth.
Western – This sounds terrible but being a Western country and due to our education the UK is *supposedly* one of the most intelligent – although you wouldn’t think it talking to some of the people I once knew.
Multicultural – No other country in the world welcomes other nationalities like the UK. No other capital city has as much ethnic and religious diversity as London. As the world becomes even smaller (as we know it is) this diversification will only stand the UK in good stead of being the innovation and technical powerhouse of the world.
Okay okay, hype and patriotism aside, I still think I make good case. Ten years from now we’ll look back at what went on in the financial markets with contempt, disgust and embarrassment.
And if we don’t then, well, we have learnt nothing.
Stephen is a communications consultant based out of the UK. You can connect with him on Twitter or check out his LinkedIn profile. | Email Stephen
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Jed Hallam
An interesting post, it got me thinking though… Never a good thing.
Does it not seem as though Carter and Brown are simply looking for another boom industry to milk until it collapses? If the government pumps millions into digital and loosely regulates it like the financial services sector (I use the term loosely loosely) then surely anyone involved in digital (including you and me) will become the new bankers, taking home £1million bonuses and holidaying in St Tropez?
Hold on, that doesn’t sound too bad really…
Mark
While I’m one of the first to join you in applauding the slap in the face our ‘greedy bankers’ have been getting recently, it’s a bit naive to celebrate the demise of the UK banking and financial industry too much.
You point out that the UK is a wealthy nation. This is not least because of the contribution of the financial services industry, which has been the biggest contributor to the UK balance of payments for a good few years and one of the main contributors to UK GDP.
There’s also a positive economic knock-on effect from the financial services industry…for a start think of all the PR and media companies that generate significant revenue in supporting financial services and banks! These companies help drive the creative and digital industries.
You briefly mention education, though (rightly) rather tongue in cheek. This is the biggest risk for me. If you look at the world’s rapidly emerging economies – China and India particularly – and see the number of highly-educated and enthusiastic people they’re turning out of universities, and compare that to the UK, we’re going to have to work incredibly hard to keep pace if, indeed, we can.
Call me a cynic – and you generally can when there’s any Goverment initiative with the word ‘Britain’ in its title – but we were happy enough to ride the coat-tails of the lightly regulated banking industry until it all went tits-up…funny how now that’s happened Government is switching its attention somewhere else.
Dan
Surely a big part of this plan has got to be about making the digital sector sustainable?
The worst thing this could do is fuel another speculative boom, that could send everything tits-up as per dotcom bubble.
The so-called ‘knowledge economy’ worries me in particular, because I still can’t see how free content on the Internet can be sustainable for businesses — especially now advertising is taking such a hammering.
And this is especially worrying for mainstream and independent media.
Hmm, answers on a postcard to Steve Carter…
Stephen
@Mark
Fair points. However, as recent events illustrate, and as is the case in America, the UK banking and finance industry was never sustainable with lax regulation.
So while there was a positive knock-on effect for all of us, the ‘wealth’ it created was partly an illusion which the government is now paying back through borrowing … or should I say, “taxing our futures.”
I also wonder how much wealth it created for places outside London. For example, I don’t know of any “PR and media companies that generate significant revenue in supporting financial services” outside of London.
Agreed on the China/India point. China actually turns out more graduates than America has people (or something like that) but in terms of media and technology we have more established and experienced businesses and people. The challenge is to stay ahead in knowledge, technology and innovation.
As mentioned, (and I could be naive here) as the world’s most multicultural city, London can claim to be home to people from every country around the world. No other city can boast this in an era of supposed globalisation.
So, what choices do we have:
Manufacturing – we can make things again. Nope, emerging countries do it cheaper.
Banking – we all know what happened there.
Digital – given my reasons above I think it’s a viable option.
Cheers!
Simon Collister
Nice post about a topic that deserves attention but has received relatively little from UK bloggers – myself included.
Carter’s plans worry me. Partly due to government regulation (however light) is top-down and laden with bureaucracy which – unless something radical is planned (and don’t hold your breath) – will have exactly the opposite effect the government wants.
What is really interesting is that Yale academic, Yochai Benkler. has written extensively about the new economic models emerging thanks to the Internet. These mdoels rely on social or non-market forces and in the foreword to Wealth of Networks Benkler actually observes “the State plays no role [in the new economy], or is perceived as playing a primarily negative role … Just like the market, the state will have to adjust to this new emerging modality of human action.” i.e. the state doesn’t work in an Internet-enabled economy.
Benkler suggetss we are on the cusp of a new era for economics and creative opportunity – *providing* key players (governments; regulators; gate-keeping corporations etc) get it right from the outset. Carter and Mandelson’s announcements fill me with dread.