Time is running out to get the UK in shape to cope with the next wave of net use, says a report.
Within two years the UK must act, warn industry experts
Tough decisions on how to encourage telecoms firms to build faster networks must be made within two years, warns the Broadband Stakeholder Group (BSG).
Without these networks the UK could suffer profound social and economic setbacks, says the industry group.
Taking no action could also mean that digital divisions across the UK become entrenched.
The BSG report looks at next generation networks that industry experts believe will take hold in many developed nations as web-based ways of life become more accepted.
In 2001, notes the report, the UK was 21st among OECD nations ranked by the number of broadband users. Now the UK heads G7 countries for availability of lower speed broadband (up to 8Mbps).
However, it warns that all the hard work done to reach that position could be for nothing if more work is not done to update the UK's telecoms infrastructure to handle very high-speed broadband.
FUTURE NETWORK SPEEDS
BT's 21st Century Network: up to 24Mbps
Virgin Media: up to 50Mbps
Wimax wireless: Fixed - up to 40Mbps. Mobile - up to 15Mbps
Fibre to the home: up to 100Mbps
"That progress could come to a shuddering halt," said Kip Meek, BSG chairman.
"Broadband matters. There's plenty of evidence that broadband itself has had a very beneficial impact on economic performance.
"The move from narrowband to broadband has been very important and our hunch is that the move from low-speed broadband will be just as important," he said.
Ubiquitous and cheap high-speed broadband was likely to bring with it a new wave of innovation and a host of as yet undiscovered benefits, he suggested.
Mr Meek said it was hard to put an exact figure on how fast networks are going to have to be in the future, but speeds of 20Mbps and upwards were at the lower end of most estimates.
There was little evidence that the UK's existing telecoms infrastructure would be able to bring such high speeds to much of the population, he added.
The new networks must reach all parts of the UK
To make matters worse, the current state of the UK market was not encouraging telecoms firms to invest in hardware to improve the top speed of UK broadband networks.
"The point we have come to, whatever technology is adopted be it fibre, wireless or whatever, is that there will be a hefty bill," said Mr Meek.
"We have to create the circumstances in the UK where someone is prepared to write out the cheques to do that."
Rampant competition in the UK broadband market made it unlikely that any telecoms firm would spend the money without encouragement.
The report said the decisions to bring this about had to be taken in the next 12-24 months to avoid being left behind by other nations which are already confronting the problem.
Welcoming the BSG report, BT said: "The BSG is right to call on policy makers and regulators to act to encourage next generation broadband."
It added that it was already piloting higher broadband speeds and new services over its 21st Century Network. This will result in faster broadband for many from 2008, it said.
A spokesman for Virgin Media, formerly NTL/Telewest, said some of what the BSG was calling for was already available over cable. He added that Virgin Media's 10Mbps service will increase to 20Mbps from May this year and it is running trials of 50Mbps among some customers in Ashford, Kent.
BT said its 21st Century Network will boost broadband speeds
"We can do both without major infrastructure changes to the network," he said.
The report made a series of recommendations on how to make it easier to invest in and create next generation networks.
Firstly, the government had to get a deeper understanding of the importance of broadband and the barriers to investment.
Government should also explore models of how it might get involved in the creation of next generation networks to ensure that all parts of the UK get treated equally.
New regulatory frameworks may be needed to encourage telecoms firms to invest that do not dent the competitiveness of the UK's existing broadband market.
"We have got a two-year period where we have to move from saying this is an interesting problem to here are the steps that enable us to move forward," said Mr Meek.