BT has called for a new regulatory regime to address telecom network deployments that use fibre-optic cables after the company revealed details of a project in Kent that will support broadband speed of up to 100 megabits a second.
BT's Openreach division will deploy the UK's fastest residential broadband network in the Ebbsfleet Valley from August as part of a Land Securities development that will result in 10,000 houses being built alongside 6 million sq ft of commercial space.
Fibre-optic cable can support much faster broadband speeds than traditional copper lines, supporting services such as high-definition TV and instant downloads, and is also more reliable than the older network infrastructure.
The development represents a test-bed for BT as it ponders the best way to deploy fibre-optic networks across the country.
BT's Openreach, which has already kitted out 120,000 UK businesses with fibre-optic access, argues that deploying fibre-optic cable in new residential developments costs no more than installing copper-based infrastructure, yet replacing the country's entire existing copper network is not yet economically viable, with demand for broadband speeds 20 times faster than the current UK residential average as yet unproven.
Steve Robertson, chief executive of Openreach, said the Ebbsfleet development represents a test for how the "new world" of fibre-optic network access should be regulated. "There has been a sea change in the UK market over the past two years with companies like Carphone Warehouse, Tiscali, O2 and Orange putting huge investment into networks. We have arguably the most competitive market in the world for broadband, but we need to maintain that in the new world."
Ofcom launched a consultation into how to regulate access to next-generation networks last September and will publish a statement on it over the coming months. Mr Robertson said that he was determined to push the pace of the regulatory consultation to ensure the process is not drawn out, as investment in network infrastructure is critically dependent on Ofcom's consultation.
The regulator is keen to ensure that competition continues to thrive in the broadband sector but also to allow companies investing in new infrastructure to make a return. In some countries, regulators have introduced regulatory "holidays" where the telecom company building the network provides its service division with exclusive access to the new infrastructure. Such an agreement is unlikely in the UK, where BT agreed to isolate its network division from its retail operation to ensure that rival broadband companies can compete.
Broadband speeds have come under the spotlight over recent months. Consumer groups have criticised providers that do not deliver advertised speeds, while the Government has raised concerns that the UK could be left behind as other countries surge ahead with plans for nationwide fibre-optic networks.
Openreach's Mr Robertson said that the Ebbsfleet development will be "very, very significant" in determining BT's approach to fibre-optic deployment as it represents a first step in gauging consumer demand for ultra-fast broadband and what pricing model would be relevant. Preliminary wholesale prices range from £530 a year for the fastest broadband connection down to £100 a year for a more basic line in the Thames Valley development.
Mr Robertson said that BT will adopt a patchwork quilt approach to improving broadband speeds in the UK rather than committing to a total overhaul of its networks. The Openreach CEO said that most consumers do not need speeds anywhere near 100Mbps, and that to utilise such fast connections, applications and consumer hardware will need to develop substantially. "It's difficult to say where the high watermark is for speed. Regardless of what the future holds, we will live in a mixed economy in terms of technology for some time yet. There is no magic wand or silver bullet. It's going to be a major period of transition and this is just the first step," he said.
BT buys 'Dragon's Den' Wi-Fi firm
BT has snapped up a small Wi-Fi business made famous when its founder successfully secured funding from Peter Jones and Theo Paphitis on the hit BBC show Dragon's Den. The two investors took a near 40 per cent stake in the business for a £150,000 outlay; the show was aired in November 2005. Dominic Killinger, who attracted bids from all but one of the "dragons" on the show, founded Square Mile Marina to deliver mobile broadband access using Wi-Fi technology to coastal areas. The service was designed to appeal to yachtsmen, and since securing the investment the business has expanded to provide Wi-Fi access at 39 coastal and inland marinas in the UK and Jersey. The company will be integrated into BT's Openzone unit, providing Square Mile's existing users with access to 2,000 BT hotspots at hotels and airports in the UK as well as 35,000 other sites worldwide. BT, which already sponsors yachting events, declined to say what it paid for the company.Reuse content