[the guardian] The government is seeking public advice on how to spend £1bn to ensure that almost all of Britain gets superfast broadband this decade – should it hook up rural communities first, or the suburbs?
The Next Generation Access (NGA) fund, which would come from a 50p a month levy on all telephone landlines proposed in the Digital Economy bill, is intended to persuade telecoms companies such as BT and Virgin Media to install fibre-optic cable to rural and suburban households where it might otherwise be unprofitable.
But the key question facing the government is whether it would be more effective to encourage telcos to install fibre-optic cable, capable of carrying two-way video and other high-speed internet links, in the most geographically remote areas – or provide funding for installation at locations that are close to those where fibre would be put in anyway without intervention due to market demand.
The two opposing approaches – dubbed "outside-in" and "inside-out" – are outlined in a consultation published today by the Department of Business, Innovation and Skills.
Charles Dunstone, chief executive of broadband provider TalkTalk, has previously described the proposed levy to produce the fund as "unjust and regressive". He has called for the private sector to be allowed to "drive next-generation broadband as far as it can".
The government has also pledged to ensure every community has access to 2 megabits per second (Mbps) broadband connection by 2012 – in time for the Olympic Games. But higher-speed broadband, with the ability to transmit high definition films and carry out live high definition video conservations, has been identified as key to economic growth as more transactions and business is done electronically.
Government launches consultation on next-generation broadband