Virgin Media races to offer fastest UK network

The 100Mbps service will require a new modem, provided free

Virgin Media is set to turn up the dial on its cable network, offering users speeds of up to 100Mbps (megabits per second).

It aims to provide the service to over 50% of the UK by mid-2012, beginning in December with 200,000 homes in London, the Home Counties and West Yorkshire.

It is the latest move in the race to bring super-fast broadband services to the UK.

It will give new impetus to rival BT's super-fast broadband rollout.

Left behind

Neil Berkett, chief executive of Virgin Media described the service as "a significant milestone".

"The world of possibilities that broadband will enable is set to explode," he said.

The first towns earmarked for the super-fast service are Chelmsford, Farnborough and Heckmondwike in West Yorkshire.

The service will be available as part of a telephone or TV bundle for £35 a month or £45 for a standalone broadband product.

"It will be interesting to see whether the British public will be tempted away from their compulsion for cheap deals," said Michael Phillips, product director of comparison website broadbandchoices.

"So far only a small proportion of Virgin Media's four million broadband customers have signed up to its 50Mbps service," he added.

Mr Berkett said Virgin Media had seen "a massive uptake" in the number of customers watching video-rich services and using bandwidth-hungry applications.

"We are now in a world where people want the best connectivity with whatever screen they are using and those service providers that aren't able to deliver this will simply be left behind," he said.

BT is Virgin Media's chief rival in the super-fast broadband race and is planning to offer fibre optic broadband to around 70% of the UK by 2012.

It questions Virgin's prices.

"Their new service is more than twice the price of BT's fibre product and we are surprised by the high price when most family budgets are tight," said a statement from BT.

It also questioned why Virgin Media has not been required to open its network to other operators in the same way as Ofcom requires of BT.

The majority of BT's next-generation broadband roll-out consists of so-called fibre-to-the-cabinet (FTTC), which is initially delivering top speeds of around 40Mbps (megabits per second).

The faster fibre-to-the-home (FTTH) technology, which can offer speeds to compete with Virgin's network, will only be available to a quarter of the total.

Experts argue that FTTH is a more future-proofed technology because it offers much faster upload speeds for services such as high-definition video conferencing which are becoming more popular.

Virgin's 100Mbps service will offer upload speeds of 10Mbps.

"This will be of particular interest to those who are sharing content online, and may help drive wider use of cloud-based applications," said Sebastien Lahtinen, co-founder of broadband news site ThinkBroadband.

League table

Prime minister David Cameron welcomed the Virgin Media roll-out.

"We want to see superfast broadband brought to peoples' homes and businesses right across the country and this exciting news takes us a step closer towards reaching that goal," he said.

Despite the government's determination to make the UK the fastest broadband nation in Europe by 2015, Britain is currently ranked 18th in the global broadband ratings.

It has also failed to make it on to super-fast broadband rankings released by the Fibre to the Home Council for Europe at this week's World Broadband Forum in Paris.

The league tables show that some 18 million homes in Europe can get FTTH, with Eastern European countries dominating the rankings.

In many cases this is because of poor existing infrastructure meaning fibre optics make good economic sense while the high proportion of people living in flats mean more homes can be reached via such technology.

Chris Holden, president of the FTTH Council for Europe said Eastern Europe could become a more attractive place to do business.

"Businesses will go where the bandwidth is. It is disappointing that countries such as Italy and France are at the bottom of the rankings while the UK, Germany and Spain aren't even on it," he said.

He said that despite a flurry of recent activity it would be "very difficult" for the UK to catch up.

No money

The European Union wants to see half of Europe's homes benefiting from 100Mbps broadband by 2020. By the same date it wants 100% of homes to have broadband speeds of at least 30Mbps.

Charlie Ponsonby, chief executive of broadband comparison service Simplifydigital, said it was hard to see where the money will come from for such an ambitious roll-out.

"The UK's broadband infrastructure is much like the railway infrastructure - getting better, but by no means up there with the world leaders. The trouble is, it is likely to cost about £2.5bn to bring us in line with the best in the world," he said.

"We expect the government to continue to make lots of positive noise and encouragement for the private sector, without actually reaching for their chequebook," he added.

Last week the government announced that the BBC would fund super-fast broadband roll-outs in rural areas.

At the World Broadband Forum, companies have been busy showing off their net wares, including a glut of companies offering cheaper solutions to fibre optics.

Some firms are offering ethernet solutions for the so-called last mile of connection between the telephone exchange and peoples' homes which would offer 100Mbps at a fraction of the cost of FTTH.

Network firm Adtran has ongoing trials of its Ultra Broadband Ethernet technology and is on the verge of signing deals with several European telcos.

At the other end of the scale, a device to boost the speeds of broadband in rural areas was also being shown off.

The WiBE gadget connects to the 3G network, creating a web hotspot where phones and dongles have no signals.

Although its average speed is just 2.8Mbps it could be a lifeline for remote areas languishing on dial-up speeds.

The gadget goes on sale in the UK from next week.

The UK government has put back the timetable to offer a minimum 2Mbps broadband connection to every home from 2012 to 2015.