BT has terminated its local exchange ADSL upgrade programme, saying that local business and government agencies must prove the commercial case for individual exchanges to be converted.
"We've equipped a thousand exchanges and have seen lower demand than we would have liked," said Clair Hannah, broadband marketing manager at BT Wholesale.
"There are pockets of the UK we haven't covered, and we don't have any additional rollout planned beyond these thousand exchanges.
"That doesn't mean we won't upgrade any more exchanges, but that in those pockets we will want local businesses or regional development agencies to prove that it is commercially viable for us to do so before we go ahead. Exchanges will be judged on a case-by-case basis."
BT Wholesale says some 60 per cent of the UK is now covered by DSL-upgraded exchanges.
The telco says it has spent tens of millions of pounds installing ADSL kit, which can cost up to £500,000 per exchange. Many have only a few users using ADSL lines.
But critics say that BT's decision in August to lower the price of ADSL is the reason why continuing to upgrade exchanges is uneconomic, and that some customers will be left frustrated.
Customers in the 40 per cent of the UK not serviced by upgraded exchanges must either rely on cable, if available, or face paying installation fees of £899 for expensive satellite services.
It is unlikely that other telcos would come to their rescue. It is thought that the disappointing pace of local-loop unbundling (LLU) by BT's rivals has resulted in just 150 lines being unbundled, most in Battersea, London.
The government has hinted that it may support rural public services but has so far made just £30m available. BT has already received limited funding from the EU to upgrade ten exchanges in Wales, which would otherwise have not been so.
BT said it would now concentrate its funds on promoting ADSL broadband in the claimed 60 per cent of the UK where it is available.
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