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BT CEO responds to 'UK worse than Japan' criticism
All about 'liquid bandwidth' he says - and a new sub-£20 product won't hurt

By Tony Hallett

Published: Monday 01 March 2004

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."