BT encouraged by G.fast broadband speed trials

Shares in BT Group gained on encouraging early trial results that found its G.fast technology, which can roll out more quickly and cheaply than replacing its entire copper wire network with fibre-optic cable, was capable of achieving speeds of more than 5 gigabits per second.

"The results give BT confidence that G.fast is a future proof technology that can help the UK maintain its position as the leading digital economy in the G20," the FTSE 100 company said.

BT and technology partner Alcatel Lucent has been testing G.fast broadband since 2007 and recently has begun testing a potential future development called 'XG.fast' in experimental laboratory trials at two locations.

If the XG.fast results can be replicated on a larger scale they could represent an important breakthrough for BT, by enabling it to deliver much faster broadband speeds to more customers without the disruption and expense of laying fibre-optic cable all the way from its cabinets in the street right into homes and businesses, known as fibre-to-the-home.

BT plans to use G.fast technology as a key part of its Openreach broadband infrastructure arm's plan to widen the number of UK premises that receive ultrafast speeds to 10m by the end of 2020, and to most of the UK by the end of 2025.

Currently the company runs fibre to the street cabinets but copper wire into many homes and business.

But the company implied that it would only deploy G.fast in 2016/17 alongside its fibre-to-the-cabinet and fibre-to-the-premises services "if UK regulation continues to encourage investment".

"These are exciting results," said Mike Galvin, a BT director within the technology service & operations division. "We know that G.fast will transform the UK’s broadband landscape but these results also give us confidence the technology has significant headroom should we need it in the future."

G.fast is currently being trialled by Openreach in Huntingdon and Gosforth, where triallists have received speeds of more than ten times the current UK average.

Goldman Sachs recently said in a note that, while G.fast will not be ready for scale commercial launch until the end of 2016, it believed BT’s G.fast roll-out "will be materially faster than its ‘targets’ suggest".

Analysts also suggested that G.fast can be deployed in the cabinet or closer to the household at the "distribution point" - this can be on a telegraph pole, in the basement of an apartment block, in a lift shaft etc. "This means that it can be deployed on a more bespoke basis to deliver very fast speeds to certain households and can also be very useful in densely populated areas with many apartment blocks."