BT speeds up fibre broadband rollout

By Derek du Preez
31 Oct 2011 View Comments
BT has introduced its first 21CN service for global organisations

BT has today announced that it will roll out fibre broadband to two-thirds of UK premises by the end of 2014, one year ahead of its original target of 2015.

To ensure it can keep to the new timetable BT is recruiting a further 520 engineers, most of whom will be ex-armed forces, to assist with the deployment.

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"The acceleration reflects the success of the programme to date and is a testament to the hard work and innovation of our people," said Ian Livingston, CEO of BT Group.

BT is bringing forward about £300m of investment over the next few years to fund the accelerated rollout, which forms part of its overall £2.5bn investment in commercial fibre broadband.

The government pledged a further £530m last November to ensure that 90 per cent of households in each local authority could access super-fast broadband as part of its Comprehensive Spending Review.

This money is being administered by Broadband Delivery UK and is available to BT and its competitors who will bid for the funds to accelerate broadband rollout in rural areas.

Rob Bamforth, analyst at Quocirca, argues that this move by BT is likely to be driven by a commercial desire to get hold of additional government funding, where it might work to its advantage in the bidding process.

"The government has committed to putting more money into the rollout of broadband in the UK and there is an opportunity for BT to capitalise on this," said Bamforth.

"BT is obviously going to be bidding alongside other ISPs, and so I don't think this announcement is 100 per cent altruistic," he added.

Jeremy Hunt, Secretary of State for Culture, Olympics, Media and Sport, welcomed BT's announcement by saying it is "great news for the UK".

"The government is committed to ensuring the UK is leading the way in broadband provision and BT's accelerated rollout will help make that a reality," said Hunt.

Bamforth also believes that BT is starting to notice increased competition in the broadband market.

"I wouldn't say that BT is starting to feel pressure from its competitors just yet, but I would certainly say that it is starting to notice that other players, such as Virgin Media, are pushing their fibre rollouts too," said Bamforth.

Virgin Media is in the process of rolling out superfast broadband, with speeds of up to 100Mbit/s, to 13 million homes by 2012.

"There is definitely a competitive imperative for BT do to more at the moment because everyone else is starting to become a bit more noticeable," said Bamforth.

"BT is continuing to push its strategy and its vision to deliver a 21st century network. It has to push forward for this reason. However, I would say that the possibility of additional funding and the competitive landscape are equally important now."

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