The £1.5 billion fibre-optic network investment plan announced by British Telecom some months ago was officially given the go-ahead by Ofcom earlier this week. Despite suggestions that Ofcom would severely limit the potential return on investment for BT it appears as though the recession will see a relatively lax regime with regards to the creation of the new network.
BT expects to deliver the first superfast broadband service next year with plans for 40% of UK homes to have access to the network by 2012. While this is a fairly adventurous project, especially in the current economic climate, it is only step one of a wider fibre-optic network project which should eventually see the vast majority of UK homes hooked up to the new superfast highway. Interestingly it has also been revealed that Virgin Media hopes to roll out its own high-speed broadband service to more than 50% of UK homes by autumn this year. However, as we covered on one of our recent post this planned roll-out by Virgin Media has also caught the eye of Ofcom.
It looks as though Virgin Media broadband will be treated in a similar fashion to BT in the future with suggestions that the company would be forced to give competitors access to its broadband network in exchange for an ongoing fee. In many ways Virgin Media will pay the price for its ongoing success although it will still have the upper hand with regards to charges and competitiveness in the sector.