BT to launch super-fast broadband

U.K. telco to spend $3 bil on network upgrade

LONDON -- Super-fast broadband services are set to be the new consumer battleground in the U.K., now that former state telecom British Telecom said it will invest 1.5 billion pounds ($3 billion) to upgrade its broadband network.

The revamped network will be capable of delivering between 40 and 100 megabits per second to more than 10 million U.K. homes by 2012, allowing the rapid downloading of movies and music at speeds significantly faster than the current 2 mbps to 10 mbps that most broadband users here receive.

The move requires regulatory clearance, but has been warmly welcomed by media regulator Ofcom, whose chief executive Ed Richards praised the initiative.

"These new networks will be a critical part of the U.K.'s infrastructure and will change our experience of communications," he said.

Following the announcement, Virgin Media, the U.K.'s biggest cable company, said it already is ahead of the game, with the planned roll out of a 50 mbps service that will pass 12 million U.K. homes by 2009.

BT will offer its services on a wholesale basis, allowing the cable operator satcaster BSkyB to rent bandwidth and offer services to its own broadband consumers where their own coverage is poor.