BT Makes Fibre Network Proposal

BT announced today that it might spend £1.5 billion on new, super-fast fibre optic broadband networks.

The massive infrastructure project would connect around one million households, which could then enjoy download speeds of up to 80 megabits per second (Mbps). By way of comparison, the current average speed is 2-3Mbps - with most homes connected to the network via slower copper phone wires.

BT also said that general network improvements will also result in ten million homes experiencing faster broadband speeds. However, the telecoms provider added that its investment was dependent on a "supportive" attitude from watchdog Ofcom, allowing it to derive greater returns.

Fibre optic cable connections are already widely used in Scandinavia and parts of south east Asia, while nationwide networks are also currently under construction in countries such as France. The very high cost of installing fibre has been seen as the reason for the UK's comparatively late entry into the market.

The firm indicated that the fibre broadband upgrade programme would be partially paid for through the suspension of its ongoing £2.5 billion share and buy back programme this month.

BT chief executive Ian Livingston said: "Broadband has boosted the UK economy and is now an essential part of our customers' lives. We now want to make a step-change in broadband provision which will offer faster speeds than ever before. This marks the beginning of a new chapter in Britain's broadband story."