Fujitsu's 1Gb rural broadband plan

RURAL broadband speeds could soon become a whole lot faster after Fujitsu announced plans to connect 5 million rural homes to its brand spanking new fibre optic broadband network.

The Japanese firm wants to deliver 1Gb services and is working with Virgin Media and TalkTalk, both of whom have said they will use the network, to offer superfast broadband to rural customers.

In addition, Fujitsu said that the network will be open to all ISPs who want to offer superfast services, providing customers with a wealth of choice and becoming the first real alternative to BT's broadband services in some rural areas.

BT vs. Fujitsu

In public, BT cautiously welcomed the competition from Fujitsu.

As the UK's biggest broadband provider and ex-incumbent it has been forced by the regulator to make its infrastructure available to other operators at a fair price in order to help reduce the cost and time involved in building future networks and boost industry competition.

The success of Fujitsu's plans rely on being able to install fibre using BT's infrastructure, such as poles and cable ducts, which will no doubt make BT a sizeable chunk of cash.

Broadband Delivery UK (BDUK) cash

However, Fujitsu's plan also depends on securing a large chunk of cash from the Government's coffers.

And it's over Government funding where BT and Fujitsu may become a little less amicable.

In December, the Government said it would provide £530 million to help towards the cost of rolling out superfast broadband in rural areas - known as the Broadband Delivery UK (BDUK) fund - and Fujitsu want £500 million of this to go towards its project, leaving around £30 million for smaller projects.

BT have also said that they're interested in Government money to push their superfast broadband network out to rural areas. Fujitsu's bid for almost all the money however suggests it thinks there is only room for one big project.

And the extra competition a new operator would provide could sway the Government's favour in its direction.

For Conservative ministers, for example, the combination of deregulation and private investment helping rural populations was always going to be a winner.

Communications minister Ed Vaizey appeared to be over the moon about the Fujitsu plan.

Vaizey rattled on: "I am delighted that Fujitsu along with Virgin Media, TalkTalk and Cisco share the Government's vision. The collaboration between these companies was exactly the sort of ambition and innovation the Government wanted to stimulate by removing barriers to broadband rollout...

"Creating this superfast broadband network will help improve the economic and social prospects of the homes and businesses where high-speed internet access remains just a dream."

Becoming less amicable

However, we don't need to wait for the doling out of BDUK cash to see the fur fly between BT and Fujitsu.

In November 2011 BT announced that they'd be speeding up their fibre roll out significantly, a move that could well make them a much more significant player in rural areas, significant enough to get Government cash almost by default.

More recently, in January 2012, Fujitsu was forced to pull out of the tender to run the BDUK scheme in Wales, leaving BT as the sole recipient for the cash in the region.

Good news for rural broadband

For now, whatever the nitty gritty of the competition, campaigners for "the last 10%" are likely to be pleased that there is competition on a national level in the long overlooked rural sector.

However, vital details such as precisely where the 5 million homes will be located and how much it will cost to buy services still remain unclear.