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£1B Boost for British Broadband

9:35 AM -- The U.K. government has officially launched its £1 billion (US$1.6 billion) Next Generation Fund in an effort to ensure its Digital Britain broadband plans are not a flop. (See UK Pledges £1B for Broadband, UK Outlines Broadband Plan, and Britain Talks Up Digital Future.)

The U.K. Business Secretary, Lord Mandelson, says some of the funds will go towards connecting rural and hard-to-reach areas with decent broadband links so they don't get marooned on the wrong side of a digital divide. [Ed. note: That would, presumably, include Nether Wallop and Upper Dicker.]

The government announcement is replete with the usual hot air about "super-fast broadband" -- a term BT Group plc (NYSE: BT; London: BTA) is using to describe all manner of access speeds -- and making the U.K. "globally competitive." It even manages to name-check "cloud computing" as a "high level benefit" that next-generation broadband can deliver. (See BT Ramps Its FTTx Plans.)

Further down its announcement, though, is a reminder that the fund is being created by a monthly £0.50 tax on each fixed line in the U.K. (See Digital Britain Disappoints.)

But at least there's going to be some funding. When anyone might benefit from the cash, though, is anyone's guess. Today marks the beginning of a "consultation process" on how the funds should be spent. "Stakeholders" have 12 weeks to respond, after which the submissions must be considered, and the arguments can start.

But even this new funding won't ensure that the whole of the U.K. will get a similar level of service. The funds will "support Digital Britain’s aim to roll out next generation networks to at least 90 per cent of the U.K. by 2017."

The government previously made a separate announcement, the "Universal Service Commitment," which aims to ensure that everyone in the U.K. has access to a broadband connection of at least 2 Mbit/s by 2012. (See Britain Botches Broadband.)

— Ray Le Maistre, International Managing Editor, Light Reading

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