BT’s New, Faster Internet Is Already Too Slow for Its Rivals

East of Ipswich, on a former Royal Air Force base, British telecommunications provider BT Group is testing what it calls the near future of broadband, according to Bloomberg.

By the end of the year, thousands of homes will be hooked up to BT’s G.fast networking hardware, which the company says will be enough for customers to stream high-definition TV to multiple sets, download movies onto a laptop, and chat on Skype all at the same time, without any dropouts or buffering. And, not incidentally, it’s a lot cheaper to install than fiber-optic cable.

In decades past, BT was the monopoly phone company in the U.K., and even as a privatized, publicly traded enterprise, it still runs all the street-level cabinets used by other broadband providers like Vodafone and Sky. BT has a last-mile problem: Although it’s strung 1-gigabit-per-second fiber between the street hubs, most homes are connected to the network with its old-school copper lines, so the average speed is more like 30 megabits per second.

Replacing all of BT’s copper with fiber would cost about 28.8 billion pounds, researcher Analysys Mason estimates. Instead, BT plans to spend about 6 billion pounds through 2020. retrofitting its street boxes with G.fast processors, which it says can wring faster speeds from copper wires by upping the transmission frequency and reducing signal disruption.

BT says its G.fast connections should be able to reach 330 Mbps, far from the high end of fiber but as speedy as its top fiber offering. For many customers, that estimate is optimistic. Broadband signals degrade as they travel over copper lines, so homes that are more than 1,000 feet from a G.fast cabinet are likely to be much slower. That’s one reason BT’s five-year rollout is targeting only 10 million homes and businesses.

BT’s rivals call G.fast a half-measure and say that as the U.K. prepares to leave the European Union, small businesses looking to compete online need high-speed fiber to keep pace with countries that have much faster internet connections, including South Korea, Japan, and even Germany and France.

Despite its drawbacks, G.fast is a solid step forward, says Matthew Howett, an analyst at researcher Ovum. “If there were unlimited money available, BT would probably be putting fiber to the remotest farmhouse in Scotland, but money isn’t unlimited,“ Howett says. “Why would you disadvantage Britain by not taking advantage of incremental improvements using a technology that exists today?“