UK prepares for faster broadband

The government is to unveil findings from a long-awaited review of the UK's broadband services.

They will help decide if firms should get subsidies to lay higher-speed cables for homes and businesses.

Industry estimates have put a minimum £5.1bn price tag on fitting the UK for next-generation broadband.

That service would boost the speed of connections linking homes and businesses to the net to 100 Megabits per second (Mbps) and beyond.

Capital cost fears

In the UK the average speed of high-speed fixed line net access is 3-4 Mbps - depending on where people live. Telecoms firms aim to boost speeds by replacing ageing copper cables with fibre and use light to carry data.

However, the capital cost of such a national re-wiring programme could prove prohibitive.

The cost of stringing fibre cables to every home and business could cost £28.8bn, according to a report from the Broadband Stakeholder's Group (BSG).

The cheapest option would be taking fibre to the street cabinets that connect homes and businesses to telephone exchanges. But, said the BSG report, even this could cost £5.1bn.

The BBC has been told that the report says there is no case for the UK government to provide cash subsidies to telecoms firms in order to accelerate the deployment of fibre.

BT commitment

It is also believed to stop short of recommending big changes to the UK's regulatory regime to ensure firms invest in fibre.

Telecoms giant BT has already said it would invest £1.5bn to upgrade its network and put 40% of UK homes within reach of next generation broadband by 2012. In addition Virgin is investing in its network to boost speeds to subscribers.

The report, written by former Cable and Wireless boss Francesco Caio, is believed to call on the government to keep an eye on the development of next-generation broadband.

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