UK Broadband-for-all plan raises concerns over cost

Industry analysts are warning that in spite of the latest plans from the government to have a broadband internet connection in every home within the next three years, many household would still find having on to be too expensive.

The replacement of the current universal service obligation, which requires the provision of every home with a fixed-line phone by the former state monopoly, BT, is being looked at by ministers. It is now envisaged that a “universal service commitment in broadband” internet will be created following plans announced recently by the Communications Minister, Lord Carter.

Download speeds of at least 2Mbps by 2012 would be offered by the scheme, with the number of homes currently unable to get such broadband speeds standing at 7 percent of all homes or 1.75 million households.

The recent warning that some households would find that taking advantage of this plan would be too expensive came from Enders Analysis, the research company.

It was noted by Enders that there was a financial cap attached to the obligation that BT had to provide fixed line services. In short, the consumer requesting a fixed-line connection would be liable to pay the excess if the cost to the company exceeded £3400 ($5000) to provide the service.

Ian Watt, an analyst at Enders said that if a similar excess cost approach was taken by the Government to universal broadband, it would be likely that a number on homes would not be able to afford the 2Mbps broadband internet access.

He said “There may be a significant number of households – most obviously those in geographically isolated small groups – who will be unable to receive 2mbps other than by paying an infeasibly large amount for it,” he said. Problems like interference from electrical devices such as set-top TV boxes, or internal wiring issues may also mean that a large number of households would be unable to reach the 2Mbps download speeds, said Mr Watt.

In defense of the recent report statement Lord Carter said that download speeds of “up to” 2Mbps would likely be guaranteed by the universal broadband commitment. According to those who saw the earlier draft, it had originally said that the commitment should be “for a minimum” of 2mbps.

In order to watch video like the BBC iPlayer over the internet, download speeds of at least 1.5Mbps or higher would be required, according to Ofcom, the telecoms regulator, and for high definition Video speeds of 8Mbps would be needed.