Virgin Media rolls out superfast broadband

LONDON, Dec 15 (Reuters) - Cable operator Virgin Media VMED.O became the first Internet provider to roll out a mass-market super-fast broadband service in Britain on Monday, launching a 50 megabits per second offering.

The average broadband speed in Britain is between 4 and 5 MB.

Virgin said the new service, which had been heavily trailed, would be almost nine times the average headline UK speed and cost 51 pounds ($76.73) per month on a standalone basis, or 35 pounds a month when taken with an 11 pound phone line.

Virgin customers with other services such as TV would also benefit from package discounts. The Virgin cable network covers around half of the country and the super-fast service will reach 40 percent of the network by the end of 2008. It should reach the rest of Virgin’s network, or a possible 12.6 million homes, by the summer of 2009.

The group has said the increased speeds will allow users to enjoy interactive gaming, the downloading of online video including high-definition TV and teleconferencing in multiple rooms of a house at the same time.

It has already touted what it believes is a strong advantage over its rivals which rely on the slower copper-based networks provided by BT BT.L. However some analysts have questioned whether demand for faster services is strong enough.

“This service will transform the way people interact and entertain themselves online,” Virgin Media Chief Executive Neil Berkett said in a statement.

BT is already trialling and rolling out 24 MB in some parts of the country.

It also already supplies fibre-based fast services to more than 120,000 businesses and it has said it will build a high speed network covering 10 million homes by 2012 with speeds of between 40 to 60 MB and up to 100 MB in some parts of the country.

The roll out depends on whether industry regulator Ofcom agrees to set the terms so BT can get a decent return on its investment.

Reporting by Kate Holton; Editing by Rupert Winchester