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BT to upgrade 10 million homes with fibre

He said the industry needs to roll out super fast broadband and acknowledged regulations need to "provide the right incentives for operators to invest, recognising the inherently risky nature of these investments".

An Ofcom spokeswoman told silicon.com: "There may well be certain rules that apply to the copper world that they may feel need to be relaxed but those are all things that need to be worked out."

She added: "The difference between the existing copper networks and fibre obviously represents a significantly risky investment. That's why we're saying that we would set a rate of return that reflects that risk."

"We're certainly keen to engage with BT to work out an appropriate way that they can invest and to give them as much clarity as possible on the regulatory environment," she said.

CEO of the Broadband Stakeholder Group Antony Walker said the announcement is not the whole answer but is a significant step forward.

Matt Yardley, analyst at Analysys Mason, said that the move by BT will "remove some of the awkward questions about why are we languishing behind many other nations in the provision of high-speed broadband".

BT CEO Ian Livingston said broadband is now an essential part of customers' lives and the plans mark the "beginning of a new chapter in Britain's broadband story".

Livingston said the aim is for urban and rural areas to benefit from the investment and the company is looking to work with local and regional bodies to deploy the tech in the best way.