BT is to announce plans for an accelerated rollout of full-fibre broadband to an extra one million households as its Openreach subsidiary prepares to invest hundreds of millions of pounds more into the technology.
The group’s board is expected to give Openreach the go-ahead next week to install full fibre-optic connections to three million homes over the next two years, up from the two million previously planned.
Openreach is the BT-owned company that controls the street corner cabinets, exchanges, wires and cables that form the backbone of Britain’s internet network. It will have to raise its annual spending on network upgrades by hundreds of millions of pounds from an estimated £1.6 billion last year, people familiar with the project said. Openreach, which by 2025 plans to connect ten million homes with “full-fibre to the premises”, or FTTP, connections, is under political pressure to act amid concern that Britain is falling behind the rest of Europe on the competitiveness of its digital economy.
Only 3 per cent of British homes have an FTTP connection, compared with 79 per cent in Spain. Most still rely for internet access on ageing copper telephone wires installed decades ago by BT when it was a nationalised company. These copper connections are slower and less reliable than fibre-optic connections, which can transmit far more data using much less energy. They also are more prone to faults.
FTTP connections are capable of delivering speeds of up to one gigabit per second, compared with the national average of only 16.5 megabits. The average link would take about an hour to download a Hollywood film such as Lord of the Rings, compared with a few minutes at one gigabit per second.
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An Openreach spokesman said: “We cannot comment on rumour and speculation. The business is consulting with its wholesale customers on how to achieve its ambition of making ultrafast — 100Mbps at least — fibre-to-the-premises technology available to ten million premises by the mid-2020s and it will be publishing an update on this process in the near future.”
BT, whose Openreach division supplies wholesale broadband services to suppliers such as Talktalk, is facing mounting competition from rivals such as Vodafone, City Fibre and Virgin Media, which are building networks.
The plans have been drawn up by Clive Selley, the first chief executive of the newly independent Openreach.
The accelerated rollout will involve thousands of engineers and huge orders of fibre-optic cables, which are in demand all around the world and are produced at scale by only a handful of manufacturers.
Separately, BT was hit yesterday with a record £70,000 fine by the telecoms regulator over its failure to provide information for the watchdog’s review of broadband and telephone services. Ofcom said that BT’s Openreach had failed properly to meet requests for information as part of its investigation into the wholesale local access market.