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BT is to significantly expand its fibre offering in the south-west after signing a £94 million contract to provide superfast broadband services to 90 per cent of homes and businesses in Devon and Somerset by 2016.

Known as the Connecting Devon and Somerset Scheme, it will be partly funded by the coalition's Broadband Delivery UK office (£32 million) and Devon and Somerset County Councils (£10 million), with the remainder funded by BT.

Under the terms of the deal, all local premises will need to be provided with a minimum internet download speed of at least 2Mb by 2016

The deal has suffered delays owing to contractual offers, with the new date of 2016 much later than the original target, but it will nevertheless be "vital" to maintaining the economic strength of the country, said Bill Murphy, Managing Director of Next Generation Broadband at BT.

"Reliable access to broadband is an integral part of 21st century living. It's much more than streaming video and music or online shopping: it's increasingly the way business is conducted and services are delivered," he said.

It will also enable firms to compete on a "level footing", regardless of their location, and make the area an entirely more attractive proposition for investment, Mr Murphy stated.

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