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BT trumpets subsidies for village broadband

Free cash pleases telco

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BT is encouraging local authorities in rural areas to consider subsidising faster broadband installations, after a village Parish Council in Kent agreed to stump up part of the cost of fibre-to-the-cabinet.

As a result of the subsidy all 1,350 premises in Iwade, near Sittingbourne, will be offered theoretical maximum download speeds of up to 40Mbit/s from Autumn.

The village's telecoms infrastructure was not originally planned to receive any upgrade. BT has committed £2.5bn to upgrade two thirds of its network by 2015, but the scheduled work is concentrated in densely populated regions where the return on on investment will be greatest.

In Iwade, the Parish Council's money helped pay to connect four street-side cabinets to the Sittingbourne exchange via fibre optics. The Parish Council provided £13,000 - about £10 per premises - for the work from a County Council grant, and BT provided the remaining £62,000.

In commmon with about three quarters of BT's wider upgrade programme, the connection from the Iwade cabinets to homes and businesses will still be copper wire. The remaining quarter of upgrades nationally will involve full fibre-to-the-premises.

BT Openreach boss Steve Robertson said he was keen to hear from other rural communities seeking faster broadband.

"Our investment is one of the biggest commercial investments in fibre in the world and we are prepared to invest further if others are prepared to work with us. Our partnership with Iwade is a great example of this and we're very keen to work with other parts of the country on similar projects," he said.

The announcement comes a week before a government conference on how to deliver faster broadband to the "final third" of the country where BT has judged its investment cannot be commercially justified.

Officials have invited ideas on how to cut the costs of deployments after a £6 per year tax on landlines, earmarked to fund rural broadband upgrades, was scrapped by the new government. There is also the possibility that ministers will top-slice the TV licence fee to subsidise upgrades.

Virgin Media, whose network currently covers about half of UK premises, mostly in urban areas, has also signalled its interest in deploying fibre optics to villages. It is currently running a technical trial in Buckinghamshire using street-side poles to string up broadband lines - avoiding expensive ground works - and is in talks with electricity companies to share their poles. ®

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