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Broadband Britain risks life in slow lane - report

'Buck up, Ofcom'

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A year long study into Britain's broadband has warned that the country risks falling behind the rest of the world.

The UK is currently in the top tier for broadband reach and access, but this happy situation may not last. The Broadband Stakeholder Group (BSG), in a major report, says Ofcom has two years to stimulate investment in infrastructure.

"If we twiddle our thumbs now we'll have to play catch-up in the future," Anthony Walker told us. "Ofcom needs to accelerate the work they need to do."

The BSG doesn't advocate public spending on broadband infrastucture, but said that without encouragement there was no incentive to lay new fibre or light up existing unused fibre capacity.

Walker pointed to two areas where costs discouraged new deployment. "We'd like to see government examine how non-domestic rating applies to unlit fibre. Right now, if you light that fibre, the full domestic rating applies. There's a disincentive for operators to exploit the fibre that's already in the ground."

The cost of laying new fibre was huge, he said.

The BSG notes that Virgin Media, which now owns the cable monopoly in the UK, is only available to 50 per cent of households. In order to modernise its network, currently capable of 10mbits/s (down), to 220mbits/s (down) and 120mbits/s (up), Virgin needs to spend between £150 and £200 per customer. That's a capital expenditure of around £600m.

Deploying fibre to the home for every UK household would cost £14bn.

Earlier this year a Deloitte and Touche report suggested that consumers will end up footing the bill for better broadband infrastructure - especially if IPTV flops.

The government also needs to devise a digital strategy to ensure people who are socially excluded have the broadband access. But what about the refuseniks, we wondered?

"Broadband allows more compelling video-rich and data-rich services to be created," said Walker. "When people see value they'll act. The market hasn't had to work that hard yet to get consumers - if anything, operators are struggling to meet the demand they have now. But as adoption rates start to slow down, operators will focus on these niche markets."

So we need a sort of MySpace for wrinklies?

"I think things like that will emerge in time," Walker said.

Read today's interview with Ofcom chief Ed Richards here. ®

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