BT says broadband tax won't stretch far enough

 

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By Barry Collins

Posted on 2 Jul 2009 at 11:30

BT has cast doubt on the Government's "broadband tax" figures, claiming that the funds generated won't be sufficient to fibre the entire country.

BT to guarantee 15Mbits/sec connections with fibre

The Digital Britain report proposes a 50p-per-month levy on landlines, that will generate about £1.5 billion to help bring fibre to the "final third" of the country.

However, at a briefing at BT's London headquarters this morning, the company's group director of strategy and portfolio, said the money won't stretch that far. "If the Government's looking for 66% to 100% [fibre coverage], I will be very surprised if that amount can cover it," said Olivia Garfield. "If you're going for 80% to 85%, I can see that being covered."

A spokesman for the Digital Britain team told PC Pro: "The Digital Britain report clearly says we're looking for 90% coverage by 2017 and we're confident we've done the research right."

When asked how much input BT had in the setting of the 50p figure, Garfield replied: "none". She claimed that BT was told about the broadband levy about 20 minutes after the press were.

"We think it's an interesting announcement," Garfield said somewhat diplomatically. "The detail is the next phase."

Garfield said that BT was looking forward to Ofcom announcing further details of how the money generated by the Next Generation Fund will be distributed to telcos such as BT and Virgin Media.

When asked whether BT would be required to match Government subsidy with their own funds, Garfield said that companies tendering for the funds would "be given a pot of money to build the infrastructure".

"There will be a bidding process were you will say 'I can build x percentage [of the network] for that amount of money," she added.

Garfield's colleague, David Campbell, the managing director of next generation access at BT Openreach, claimed companies could use the money to plug holes in their existing fibre rollout.

"There are lots of potholes in the Virgin network that I know, if it had funding, it would like to fill in," he claimed.