Gov won't fork out for next-gen broadband

Companies not getting help with £30 billion bill

15 September 2008 12:49 GMT / By Katie Scott

A new report has suggested that the government isn't going to reach into its pockets to help pay for the UK broadband network to be updated.

Last week, the Broadband Stakeholder Group, a Government advisory group, said that installing high speed broadband - capable of speeds up to 100Mbps - in every home in the UK could cost up to £29 billion, with a minimum cost of £5 billion.

But now a new report, following on from a 6-month long review of how ready this country is for high speed web access, says that companies aren't going to get help footing the bill.

Review author Francesco Caio says that instead of paying money to telecoms companies, the government should encourage these companies to take on the risks themselves.

BT has already announced it is going to spend £1.5bn on laying fibre and Caio pointed to this, and Virgin's plans to also update its networks, as "promising signs" that the UK will be able to update its broadband infrastructure.

But it will be "support" that the Government offers and not subsidies, the report suggest, such as working with building firms to ensure new builds have next-gen internet access.

Antony Walker, head of the Broadband Stakeholder Group, responded to the report stating that the government needs to act now.

"The government needs to come off the fence about next-generation broadband and be very clear that it thinks it is of real, fundamental importance to the UK economy for the next 5-10 years", he said.

"Making sure that patchwork fits together seamlessly - that's where government and Ofcom have a role to play", he concluded.