BT offers universal broadband in bid to avoid regulation

Telecoms giant BT has offered to deliver broadband to 99 per cent of UK premises by 2020 in a bid to avoid government imposed rules on delivery to remote areas. BT said it will invest ?600 million to deliver universal coverage by 2022 and provide speeds of at least 10 megabits per second (Mbps) to 99 per cent of premises by 2020 via its recently spun out network division, Openreach. A recent report from Ofcom suggested around 1.4 million UK households are currently unable to access broadband speeds of at least 10 Mbps, however MP’s were critical of the Ofcom report, believing it failed to distinguish between take-up and availability.

MP’s estimate there are a further 5.3 million UK premises which have chosen not to take faster broadband speeds, many of which are unable to access speeds of up to 10 Mbps. The government has proposed a universal service obligation (USO) to help remote households access broadband, which is currently under consultation. The USO, which the government planned to roll out in 2020, would give all households and premises, regardless of location, the right to request a broadband connection and BT would have to provide the infrastructure.

BT is proposing instead to roll out the necessary infrastructure “proactively” and would then recoup the cost from customer bills. The Department for Digital, Culture, Media and Sport said it will now consult on the BT proposal, and said if accepted the deal would be legally binding. Culture Secretary Karen Bradley said: “We warmly welcome BT’s offer and now will look at whether this or a regulatory approach works better for homes and businesses.

“Whichever of the two approaches we go with in the end, the driving force behind our decision-making will be making sure we get the best deal for consumers.”

BT chief executive Gavin Patterson said: “Our latest initiative aims to ensure that all UK premises can get faster broadband, even in the hardest to reach parts of the UK. In 2014 BT was accused to having secured an effective monopoly what was then estimated as a ?1.2 billion UK rural broadband rollout scheme after securing all 44 broadband projects on offer. The National Audit Office had warned the project was moving forward “without the benefit of strong competition to protect public value”.

BT has to date picked up ?1.7 billion in public money rolling out the rural broadband scheme across the UK, though last year was told to return at least ?258 million in subsidies where take-up of broadband was more profitable once launched that previously estimated.

Around four million homes have been connected to fibre broadband through the Broadband Delivery UK scheme since 2010.

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