Realising Scotland's full potential in a digital world: a digital strategy for Scotland

Chapter 4

"Economic success demands that our ability to benefit from digital is not limited by where we chose to live or work."

Fergus Ewing: Cabinet Secretary Rural Economy and Connectivity

• 88% of premises have next generation broadband access.
• 83% of premises have superfast broadband access.
• 46% of rural premises have superfast broadband access.
• Average broadband download speeds are 35 Mbits/s across Scotland and 15 Mbits/s within rural areas.

Digital Scotland:

• Provides high quality connectivity across the whole of our country
• Is recognised internationally as a natural test bed for innovation in connectivity

Connectivity is a vital part of our national infrastructure. People think about it in the same way as gas, electricity and water. Businesses depend on it to improve productivity, support customers and open new markets. And we see investment in fibre, masts and sensors as being as vital to economic growth as more traditional investments in the physical infrastructure of roads, rail and buildings.

"Achieving 100% superfast broadband coverage will further boost Scotland's status as a world-class, digitally-connected nation. Digital contributed £10.3 billion to the Scottish economy last year and, with 82% of firms providing significantly more digital content than they were three years ago, Scotland is leading the way. The Scottish Government is creating an environment that supports private investment in broadband rollout and this is delivering benefits. Virgin Media recently announced ultrafast rollout to over 360,000 premises in Scotland, two-thirds of which will be FTTP, taking our footprint to well over 1 million premises in Scotland. This will grow as we assist in the delivery of the 100% commitment."

Martin McFadyen, Head of Scotland, Virgin Media Business

Telecoms is a reserved matter which means that, like defence and foreign affairs, it remains the responsibility of the UK Parliament. However, the central importance of digital connectivity to Scotland's economy has meant that the Scottish Government has had to become increasingly active in this area. We know that in the past, too many areas of our country have not shared in the benefits of good quality connectivity. We therefore want to work in partnership with the UK Government, other parts of the Scottish public sector, the UK regulator Ofcom and with industry to ensure that this doesn't happen in future. The Scottish Government will use its powers to create an environment where the private sector can invest, while ensuring that Ofcom and the UK Government do more to shape the regulatory environment in a way that recognises and responds to the unique challenges posed by Scotland's low population density and geography.

National and local government in Scotland have worked well together in recent years to extend access to high quality connectivity in areas where investment could not be justified by commercial providers alone.

Our investment through the Digital Scotland Superfast Broadband programme has greatly enhanced Scotland's digital infrastructure, creating a fibre spine that runs through most of mainland Scotland and reaches out, through sub-sea connections, to some of our most remote rural and island communities.

We want to build on this, to create high bandwidth, easily accessible fibre infrastructure across all of Scotland. This will provide a platform on which we can:

• Extend superfast broadband access to all by 2021, while encouraging the growth of ultrafast services
• Revolutionise performance by connecting fibre to masts, small cells and sensors and deliver further increases in speed and reliability as we move towards symmetric gigabit connectivity
• Extend international fibre links, reducing our reliance on London and building greater resilience and diversity into our networks
• Make targeted investments in mobile infrastructure that address gaps in 4G coverage, while laying the groundwork for 5G deployment in Scotland
• Develop a national LoRa-wide area network that supports Machine-to-Machine networking and puts Scotland at the cutting edge of the Internet of Things, while supporting our businesses to innovate and take full advantage of the economic opportunities offered by IOT.

We will continue to invest in digital infrastructure, focusing on areas that are beyond the reach of commercial suppliers. But our planned investment is likely to have a different focus in future.

We want to promote an "outside-in" approach. We will prioritise future public investment on our hardest to reach rural areas while ensuring that our UK partners prioritise rural coverage when it comes to setting future coverage obligations. At the same time, we will encourage commercial suppliers to address remaining gaps in urban Scotland.

We will bolster Scotland's backhaul capacity. This will underpin a wide range of connectivity services, from superfast broadband and 4G today, to ultrafast broadband and 5G tomorrow.

100% coverage will not be delivered by one technology, one supplier or one procurement. We are planning a phased approach that will see a range of projects progressed from 2017 onwards. This includes a project, supported by the European Union, to bring new sub-sea fibre and microwave connections to our island communities.

We will launch a public consultation on our new intervention area for the Reaching 100% programme in Q2 2017. This will move away from an approach based on postcodes, to one based on premises, removing the anomaly where some premises have missed out of the benefits of previous programmes. We will launch new procurements later in 2017, with deployment anticipated from 2018.

The outside in approach will also drive our approach to extending mobile coverage. Scotland was left poorly served as a result of previous UK-wide spectrum auctions, which prioritised revenue at the expense of rural coverage. We will work with the UK Government, Ofcom and industry to ensure that history does not repeat itself.

The action plan we have agreed with the four UK mobile operators commits us to working together to develop an infill programme to address mobile "not-spots". We will set out our plans by June 2017, with new procurements to follow soon after.

"After many years of doing without, Coll has now got a fantastic 4G mobile mast which has been quite revolutionary. Where i live - at the end of the line - the phone line was so crackly it was a struggle to speak with clients and understand them. I previously had a landline and satellite broadband but have actually cancelled both because the 4G service here is so good and so fast. The world-wide wait is no more."

Pete Mackay, Coll Remote Support

We will also ensure that Scotland is at the forefront of 5G. Working with Scottish Futures Trust, we have already established relationships with key 5G players - from academia, industry, 5G working groups and regulatory bodies. We will formalise these relationships to drive the development of 5G in Scotland - and in so doing, ensure that Scotland receives a fair share of UK-Government funding to support 5G trials.

We will make Scotland a natural test bed for innovation in connectivity. This requires us to build links with businesses across the world to attract their investment against international competition and develop a robust case that demonstrates the impact that an investment in connectivity can have on sustainable and inclusive economic growth.

Actions

Actions to deliver high quality connectivity across the whole of Scotland:

• Ensure that every premise in Scotland is able to access broadband speeds of at least 30 Megabits per second by 2021
• Launch a public consultation in Q2 2017 to confirm the areas in which we need to intervene to deliver 100% broadband coverage and then start the procurement process soon after to begin deployment in 2018
• Ensure that 4G coverage is available throughout most of Scotland and on all key transport routes - A and B roads and main railway routes
• Urge the UK Government and Ofcom to apply the "outside-in" principle when auctioning spectrum for 5G deployment and ensure that operators deliver coverage to our most rural areas before they deploy in urban centres
• Establish a "5G Hub" in partnership with industry and academia to ensure that Scotland is at the forefront of 5G research and deployment
• Develop our understanding of the Internet of Things and how Scotland can benefit
• Ensure that all of Scotland's cities have internationally competitive connectivity
• Extend Scotland's Internet Exchange across multiple sites, ensuring greater diversity and improving internet performance for end users
• Use Scotland's business rates system to incentivise the commercial delivery of new fibre and mast infrastructure
• Take advantage of Building Standards policy to help ensure that new buildings are digital ready
• Support Community Broadband Scotland to deliver a pipeline of 16 community networks across the country with potential to connect up to 8,000 premises
• Develop, test and make decisions based on robust models of investment drawing on the very latest international data on the economic and social value of digital connectivity