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Gov't to help finance next-gen broadband network

No indication of how much will be offered

Gordon Brown has revealed the government is considering investing in Britain's next-generation broadband network.

The cost of transferring the UK's existing copper network to a new high-speed fibre system that is capable of offering homes in Britain 100Mbps broadband, has been estimated at £15bn.

Telecommunications companies including BT and regulatory body Ofcom have been squabbling over who will foot the bill. Meanwhile, the government has remained tight-lipped on any financial help it planned to provide.

However, the Prime Minister told The Observer that renewing the 'digital infrastructure' is part of his plan to help the country beat the recession.

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"When we talk about the roads and the bridges and the railways that were built in previous times - and those were anti-recession measures taken to help people through difficult times - you could [by comparison] talk about the digital infrastructure and that form of communications revolution at a period when we want to stimulate the economy. It's a very important thing."

Brown made no indication on how much or when the help would be provided. Whether this will be enough to soothe the concerns of BT shareholders that recently questioned the level of investment required by BT compared to the returns, will remain to be seen.

BT shareholders may also be concerned by recent research by the Broadband Stakeholder Group (BSG), which claims the cost of installing and supplying 100Mbps super-fast fibre broadband to the whole of the UK could cost as much as £24.5bn, thats £10bn more than it was first thought.

See also: BT pressures Ofcom on 100Mbps fibre broadband

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