NEWS BT CEO Ben Verwaayen has hit back at criticism that broadband speeds in the UK are too slow in comparison to some parts of Scandinavia and in particular countries in the Far East, saying what's important is specific services made possible by the right bandwidth at the right price.
The comments come on the day the telco has announced a sub-£20 per month 'basic' broadband offering, which it claims will still deliver 512Kbps speeds but will cap customer usage at 1GB of downloaded data per month.
Speaking at the UK Technology Partnering and Investment Forum in London this morning, Verwaayen revealed BT will eventually have a portfolio of broadband products at speeds going up to 1Mbps, 3Mbps and higher but said: "All services, with the exception of live TV, are possible with 1.5 to 2Mbps."
He noted that Softbank, one of the largest providers of broadband in Japan, supplies connections of up to 45Mbps but when he asked them what different things this allows end users to do, he was told: "Nothing but it's great marketing."
The 'sufficient speed' comments are bound to raise eyebrows. Many in the industry put ideal minimum bandwidth at around 8Mbps, allowing high-definition TV and other applications to run at once.
But Verwaayen went on to warn against "pestering ourselves" about megabit per second rates and instead "concentrate on services" and what he calls "liquid bandwidth". He said: "That's a much smarter way than talking about bandwidth megabytes."
Recent polling of silicon.com readers has shown 55 per cent define broadband as at least 512Kbps, which ties in with BT's definition. However, minorities - perhaps taking cues from rollouts elsewhere around the world - see the term meaning over 2Mbps (according to 8.3 per cent) or over 10Mbps (5 per cent).
Last week, after studies of the Japanese market, Brunel University's Dr Jyoti Choudrie said: "The UK broadband community needs to sit up and take note of the example Japan is setting."
But the debate is not about speed alone. One in four households in Japan has broadband, as opposed to fewer than one in 10 in the UK.
However, Verwaayen countered: "The spread in Japan [of broadband availability] is much greater. If you are rural, forget about it. I don't think that's a policy that would work over here."
The move by BT to provide an entry-level broadband service which - unlike offerings from Tiscali and, as of today, Telewest - doesn't come at a lower speed has been welcomed by Ovum.
In a research note, the analyst house says: "With BT's brand and marketing clout, together with a low price, there is no doubt that more customers will turn once again to BT."
Comments
There are 22 comments. Join the discussion
1. Mike McCreadie
The lack of any competition to BT leads them to take very few risks. Unfortunately this means that although I live on the outskirts of a major city there's no chance of them enabling broadband in my area unless they get gauranteed numbers to pay for it. If there was realistic competition someone would take the risk but until then any definition of broadband means little to me.
2. anonymous
This artyicle shows just how effective the BT marketing machine has been. Three years ago NO-ONE thought of 512Kb as 'broadband' - 2MB was seen as the minimum. Anything less, down to ISDN, was seen as 'mid-band'
3. Jeremy Chatfield
It's not "BT's brand and marketing clout", surely? This must be a typo for "BT's ability to snow the regulator"?
How long have we been waiting for Local Loop Unbundling? Who controls the exchanges? Who sets the cost that third parties see for access? This is not "market-leading" this is anti-competitive "monopoly control" in action.
4. anonymous
I get frustrated at the constant debate over broadband, speeds, price, availability when we should be looking to tear out all this 100 year old copper and build a fibre to the home which would initially provide 10/ 100MBps and eventually maybe gigabit.
5. Nico Macdonald
I am sympathetic to Verwaayen's defence, particularly his advocacy of services. Many future services delivered over broadband may require very little bandwidth, taking advantage instead of having an always on connection with little latency. How much bandwidth do those hot communication technologies SMS and IM need? Almost none. Even delivery of TV could be facilitated by 1.5 to 2Mbps broadband, using asynchronous models. (After all TiVo delivers TV using RF, which is much lower bandwidth than any broadband BT sells.)
Sadly, in the UK we are still fixated with broadband for faster access to Web sites and email attachments, and music and software downloads. We have to get away from our PC-centric, reactive model of network use and develop services that take advantage of <em>all </em> the characteristics of broadband, and that also better fit into our lives. For all of Verwaayen's convincing talk, BT has yet to deliver in this area.
(I wrote further about the bandwidth fetish in a December 2003 journal posting '<a href="http://spy.typepad.com/technology_and_society/2003/12/enough_bandwidt.html">Enough bandwidth already</a>.)
6. anonymous
Hooray for BT they have broken the price model - NOT.
When investigating this new price structure versus the older one, the consumer will save a breathtaking £4 in the first year! That works out at a staggering 33p per month.
To make matters worse, I have to stump up £80 for the use of a restricted service before I can use it - smooth!
Come on BT - marketing hype will not encourage people to sign up for these deals. What they need are honest, realistic prices that start off at a low cost, and as you use more you can pay more. You have been doing this through dial-up for years so you should be able to get you head around it.
7. anonymous
The trouble with this country is that of GREED. We pay top end of the scale for substandard services compared to other parts of the world. Look at the US and Singapore prices of broadband is so much cheaper than her in the UK. The high prices we pay here goes to lining the FAT CAT's pockets for absolutely poor service like Council TAX, PAYE & NI, a TAX
8. Colin Robertson
For me "broadband" means much higher speed than V90 and the ability to share the phone line. This is very adequately met, for everything I want to do, with my 512Kbps provider (AOL). Higher speeds, if widely available, will open more possibilities, but to say my 512Kbps service is not broadband is absurd.
9. anonymous
"However, Verwaayen countered: "The spread in Japan [of broadband availability] is much greater. If you are rural, forget about it. I don't think that's a policy that would work over here."
This really is the height of hypocrisy from Mr Verwaayen. After all, wasn't that just what BT's policy was until public outcry (with a little help from Silicon.com) forced them to change their tune?
10. Adrian Carey
Once again BT gives excuses for restricting progress. If there was sufficient bandwidth available - services like real time teleconferencing could take place over the internet rather than via expensive ISDN lines. Now this would be something that BT would be in favour of.....wouldn't it??
11. anonymous
I know it is unfashionable but I feel i have to offer a little defence for BT on this issue.
It is true that the more bandwidth Britain can squeeze from the network the better however we have to be mindful of a fundamental difference between the infrastructure in other countries say Japan and that within the UK - The age of the beast.... BT inherited (cheaply it must be said) a massive estate of distrbuted cabinets feeding a copper network, the design is, relatively speaking, ancient.
Whereas as I understand it Japan and other so recently nascent economies have relatively modern infrastructures more widely based on final mile fibre, allowing more cost effective delivery of wideband technologies which offer those blistering speeds we crave.
just goes to suggest that you just can't compare different markets that simplistically.
When you further consider the massive investment BT have made and the 85% household availabilty to 2m user takeup (i make that about 15-20% utilisitation) you can understand why they are a little reticent to explore faster more costly technologies. However if you want 500Mbits BT can give it to you (if you want to pay for it!).
Broadband has been promised for all (read as most) exchanges by the end of 2005 and if you really want it now you can campaign or even invest with a bunch of like minded souls in your own (maybe grant supported) DSLAM
I recollect not so long ago happily leaving a machine on overnight to download a massive 17 Mbyte install of Mozilla maybe we need to remember a bit of patience? I know it's been a long time coming but my grandmother loves her 33.6 modem to bits she'll probably do no more than chat to distant friends with broadband. A bit of conservative web authoring and an ability to step back a bit and look at where the country has got to might make things seem a little better.
Gamers filesharers and porn addicts aside where the bandwidth is a must it might be painful to use your narrowband at the moment but you could always move if it's that much of a hinderance 8-)
12. anonymous
The profits BT make and the service they deliver are severly unbalanced. If they had competition they would do something about this huge issue. How many of you out there have rang BT tech support because you cannot get online and they tell you to go to their website to troubleshoot? Hello!!!!
13. anonymous
Suffolk calling.
And there ain't no broadband oot eer bwoy, as they say in these parts. Ten miles north of BT's development labs at Martlesham.
Every month I ask BT for broadband, every month they say no chance. Broadband Britian will never go broadband while BT can make more money on dial-up, like my £150 a month.
14. Michael Carter
This is all to do with positioning crap products at inflated prices. They keep telling us that providing broadbrand services is really really difficult and that our 600k connection is really really cutting edge when other countries show us this is just not the case. They're basically rationing the service to keep prices artificially high.
15. Mark Broughton
I lived in a rural part of Japan for 5 months last year, a place called Kasai City if anyone can find it on a map, I had a single CAT5 cable into the apartment, through which I had, digital TV, Telephone and broadband internet at a rate that allowed me to download a 1Mb file in under a second, so that claim that if in rural Japan is a load of Bull !!
16. anonymous
Broadband is often not the limiting factor.
The way the web page has been writen is a large factor and silicon is one of the slowest to load of any when using broad band and not worth trying with modem.
17. Philip H Young
Dear Mike McCreadie,
BT have had their hands & feet tied together for far to long to enable oppersition to get established. But the oppersition are far to greedy & only want big profits for their share holders. They only target large business costomers for a quick buck, & to pot with the individual living in the sticks. They leave all the costly jobs such as giving broadband service to the likes of you, as a lone individual provision job to BT. This is mainly as you do not represent a large profit to them. PS have any of the other companies made an effort to provide cableing in your area? Have they made an effort to provide their own infrastructure? Most probably not, they will rely on the fact the Oftel allow them to use up BT's spare capacity, at BT's cost. Who has to provide Public Phone Boxes in the wilds? Who has to provide service both telephonic & broadband to farmers & others living well away from the nearest town or village? Oh! BT because their licence states that they have to. But for some reason the other companies don't.
18. Philip H Young
Dear Jeremy Chatfield.
L.L.U. This was decreed by the regulator, to happen. BT had no say in the matter. They had to make available space in their exchanges, access to their distribution & every thing that goes with it. The cost of which was outside BT's hands & was aducated outside BT. Under the strict eye of the regulator. But most of the individual companies decided not to proceed. Some did & are opperational. It was all down to profit. Equipment is very expencive even when placed in a BT area & not in your own little room. Please ask these other companies why they did not go ahead.
19. Philip H Young
To:
Name: Anonymous
Country: Suffolk
Occupation: MArketing Analyst
Comments: Suffolk calling.
And there ain't no broadband oot eer bwoy, as they say in these parts. Ten miles north of BT's development labs at Martlesham.
Every month I ask BT for broadband, every month they say no chance. Broadband Britian will never go broadband while BT can make more money on dial-up, like my £150 a month.
BT offer for £15/month BTopenworld try that it is cheaper way for you to slag off BT.
We won the last war & fortunatly the main of the country way in tact. But our communications network survived. The only unfortunate thing about that fact is that we were left with a very old infrastructure of copper cable. In the late 70's copper was not freely available & aliminum cables were used. Unfortunatly broadband will not work over aliminuim. The installation of fibre into the home is excencive. I have no doubt if you as an individual were willing to pay for it any company providing broadband would put it in for you.
20. anonymous
I come from Japan 6 months ago to study ih the UK, and I feel that BT broadband costs quite high and annual contract is surprising business. Yahoo Japan provides 45Mbps ADSL service by £20/month with free activation and first 2 months fee. Hence other ISPs provide optical 100Mbps service which costs about £33/month. Cancellation is free.
In addtion, Yahoo provides optional service which are CATV, IP telephone, etc.
I think high speed broadband service with reasonable price may increase its customer, then the ISP can invest enough contens services. It also may attracts more customers as a good circulation.
To spread broadband business, the UK needs new innovator like Yahoo Japan, because Yahoo Japan competes NTT, which is the most biggest telecommunication firm in Japan like BT. So broadband is spreaded in Japan rapidly.
21. Mike McCreadie
Philip, you seem to be confused. The infrastructure, as you say, may be provided by BT, but that doesn't mean that they should be the only people to carry the burden of cost. Bandwidth, like gas and electricity, is bought and sold before it reaches the consumer so there is no reason to claim that BT must carry the cost of providing the infrastructure on their own. BT alone (excluding cable and satelite of course, but they are different technologies) are in the position to provide broadband infrastructure. They alone are in a position to ration it or freely provide it as they see fit, so they alone are in a position to dictate the market. It goes without saying that they will try to maximise profit for the least risk and that's what they're doing. Oftel is trying to be fair but at the moment the picture is askew in favour of BT. They are the monopoly and Oftel are in place to ensure that they do not abuse it but that doesn't mean that BT won't play the game in their favour. They're not taking risks. They don't have to.
22. anonymous
I have just found out that apart from not being able to get broadband, my villgae is not able to get ISDN either. I was told it NEVER will by engineers and that if I did want it I would have to move to get it. Nice one BT.
Where do I go to get this injustice righted?