ISPs Cable & Wireless and Fujitsu have pulled out of the Broadband Delivery UK (BDUK) bidding process to secure funding for a broadband pilot in the Highlands and Islands region of Scotland.
The government pledged £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 BDUK and is available to BT and its competitors who will bid for the funds to accelerate broadband rollout in rural areas.
Highlands and Islands was selected as one of four rural areas, along with Cumbria, North Yorkshire and the Golden Valley in Herefordshire, to receive between £5m and £10m to pilot the latest superfast broadband fibre technology.
Highlands & Islands Labour MSP Rhoda Grant has said that the bidders withdrew due to a lack of public money being made available.
Fujitsu has confirmed that it withdrew from the Highlands and Islands bid because it claims the "area would require additional investment for the required infrastructure".
Cable & Wireless was not available for comment at the time of publication.
"I am deeply concerned to learn that a second bidder, Cable & Wireless, has withdrawn its tender for the Highlands and Islands broadband pilot," said Rhoda Grant.
"This follows Fujitsu backing out last week due to the lack of public money being invested in the project," she added.
"This pilot is of vital importance to every community throughout the Highlands and Islands and it is essential that more public money is invested in this project – so far only 10 per cent of the estimated costs have been secured."
Grant is pleading for the Scottish government to release more funds to ensure the rollout is secure.
"Westminster is presently investing more in broadband in Scotland than our own Scottish government is and this needs to change," said Grant.
"[I am] calling on our government at Holyrood not only to introduce its broadband action plan with immediate effect but also to urgently increase the amount it is investing in Scotland's digital future."
This now leaves just BT and Commendium as the last remaining ISPs looking to secure funding for the area.
"BT is still bidding for the highlands and islands broadband project. It is a challenging project given the topography but we remain committed to working with Highlands and Islands Enterprise to try and find a solution," said a BT spokesperson.
"BT has a strong track record in the region and so has a good knowledge of what is and isn't feasible given the funds available".
This news comes shortly after it was revealed that Geo Networks has withdrawn from the BDUK framework, claiming access to BT's ducts and poles is too expensive.
BT is allowing network operators to connect to its infrastructure, where they can install sub-ducts in BT's ducts, or attach equipment on to BT's poles, in order to provide broadband in hard-to-reach areas without having to make huge capital investments in setting up their own infrastructure.
Fujitsu and Cable & Wireless were not available for comment at the time of publication.