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Tuesday, 12 December, 2000, 21:41 GMT
Fast net is slow to arrive
tortoise AP
Broadband net connections may be slow in coming
By BBC News Online internet reporter Mark Ward

Five companies have called off plans to offer high-speed internet services to home surfers.

The companies are pulling out because the cost and complexity of providing the services are too great to bear.

Oftel says the withdrawals will not disadvantage consumers because many more companies are pushing ahead with plans for fast internet services.

The move comes as Oftel criticises BT for slowing the pace at which competitors can get access to its exchanges.

Net loss

Many keen net users around the country are counting the days until they can go online using a high-speed ADSL connection that works via their telephone line.

Asymmetric Digital Subscriber Line (ADSL) connections run up to 10 times faster than the fastest modems and leave the phone line free for ordinary voice calls.

To speed up the process of getting fast links to consumers, Oftel has forced BT to give rivals keen to offer ADSL access to the privatised utility's exchanges.

Broadband benefits
24-hour internet connection
Video on demand
Fast interactive digital television
Fast interactive home shopping
Video e-mail
Video conferencing
Fast downloading of games, music and software
These high-speed services can only be made to work by putting an ADSL box at either end of the phone line linking a home to its local exchange.

But now, five companies have announced they are putting on hold plans to roll out the fast net services nationwide.

Telewest, NTL, Global Crossing, Worldcom and KPNQwest are all scrapping their DSL plans.

All say the high cost of building a nationwide network to support the services is prohibitive and hard to justify as investors turn against funding high-tech firms.

Telewest estimates that it would cost it more than 800m to set up a national ADSL service.

Cap promise sought

Two other telecommunications firms, Thus and Energis, are believed to be seeking assurances from Oftel that the cost of access to BT's exchanges will be capped.

Telewest and NTL are concentrating instead on the areas where they have already installed cables that can support TV and telephone services.

"We share the view that we would be better advised to spend our money and concentrate our firepower in rolling out aggressively in areas we have already got," said Telewest.

In an attempt to boost take-up of its cable modem service, NTL recently halved the montly cost of its service.

A spokesman for Oftel said the withdrawal of the companies, which include some of the UK's biggest cable firms, would not unduly affect consumers.

"A considerable number of operators have bid for space in BT's exchanges," said the spokesman.

"The market place is still developing and local loop unbundling is one way of delivering high-speed services to consumers."

Late last month, Oftel took BT to task over the speed with which it was giving rivals access to its exchanges.

Broadband: What you need to know

See also:

01 Dec 00 | Business
28 Jun 00 | Americas
27 Jul 99 | Business
06 Dec 00 | Talking Point
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