BT's New Fiber Based Broadband Service to Speed Things Up in UK

On Tuesday, BT (BT) announced that it would spend roughly $US 3 billion to roll out a new fiber based broadband service capable of supporting up to 100Mbps with the goal of making  it available to 10 million homes by 2012. Similar to AT&T's (T) UVerse service, in most cases the BT fiber will link directly to the street cabinet, called FTTC (fiber-to-the-cabinet), and will not be installed to the home, called FTTP (fiber-to-the-premises), like Verizon's (VZ) FiOS service is. The Olympic village and other select locations will have the fiber connected directly to the premises, but those look to be less than 10% of the installs.

Reports say that BT will provide customers with an initial speed of 40Mbps with it increasing to 60Mbps based on accelerating the technology. Today, BT's standard fast broadband speed now tops off around 8Mbps with ADSL2+ offering a maximum speed of 24Mbps. However, a large portion of UK broadband customers of BT still complain they see nowhere near the 8Mbps rate advertised and are being misled. Virgin Media (VMED) is hitting back at BT's announcement saying it has already spent $26 billion to make 50Mbps rates available to 12 million customers in the UK by the end of this year.

Reports say that the UK still lags behind economies such as France, South Korea and Japan in terms of the maximum broadband speeds available to consumers. The bottom line for folks in the UK is that more competition is coming to the area, which means speeds should increase and prices should go down over time. More competition for truly fast broadband connections are needed in the UK and they need to be rolled out in outlying areas and not just major cities, something BT is saying it is committed to doing.

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