Broadband threatened by road digging charges

A £500 daily charge for occupying roads when installing equipment could mean a significant hike in the cost of broadband installation, MPs fear

Concern is growing that the rollout and take-up of broadband services by UK companies could be damaged if telecoms firms are forced to pay up to £500 per day to dig up roads and install equipment.

The Department of Transport, Local Government and The Regions (DTLR) recently launched two pilot schemes under which gas, water, electricity and cable companies will face the daily charge. The initiative -- called "lane rental" -- is an attempt to reduce traffic delays, and the government has indicated that if it successful it will be rolled out across the UK.

A number of MPs are understood to be very concerned that this could seriously damage the take-up of broadband, as it would significantly increase installation costs and consequently put off many companies from upgrading to a high-speed Internet connection.

Richard Allan MP, who represents Sheffield Hallam, believes that telecoms companies are being unfairly blamed for traffic disruption.

"No proper research is being done into the actual causes of these delays. It seems that the government has come under political pressure, and the easiest thing for it to do is bring in these charges," Allan told ZDNet UK News. "It's effectively a tax on broadband," he added.

The government claims to be committed to making the UK a world leader when it comes to the availability and take-up of broadband, but Allan believes that the £500 daily charge will have a damaging impact on telecoms companies who sell high-speed Internet services to companies.

"If a business wants fast Internet access then they really need their own fibre-optic line. Cable companies and telcos such as Thus who offer individual connections for businesses are most likely to be hit by these charges," Allan said.

Allan raised his concerns last week, during a parliamentary debate into the Communications Bill. He is now organising a series of parliamentary written questions in an attempt to fight the lane rental plans.

According to e-commerce minister Douglas Alexander, the Department of Trade and Industry -- the government department that is largely responsible for broadband -- is meeting regularly with the DTLR to discuss the lane rental pilot schemes, which are due to be reviewed after the end in May 2004.

"The effect of national implementation of lane rental charging on the rollout of broadband and 3G mobile networks will be taken into account in these reviews," promised Alexander last week.

The lane rental charges should not have any effect on the cost of consumer broadband packages based on BT Wholesale's self-installation broadband.

"The whole point of ADSL-based broadband is that it uses the existing copper telephone wire, so there's absolutely no need to dig up the roads," a BT spokesman pointed out.

However, the charges could impact on the cost of cable-based broadband services, if ntl or Telewest embark on an expansion of their networks in the future.

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