I think broadband in the States has been subsidised by the Government for quite some time in order to make it cheaper for people to have Internet access from home. The UK's lagged behind for quite some time, but as the result of the Digital Britain summit that took place at the British Library the government are planning to have a minimum of 2Mbit/sec broadband in all UK homes by 2012. Funding for this is coming from the leftovers from the digital switch-over funding and currently stands at around £250 million - makes you wonder how they grossly overestimated by so much.
Some people have commented that 2Mbit/sec is nothing by today's standards - but not everyone has broadband, and not every one even has Internet access and that is who this initiative is for. By everyone having internet access it means the government could in theory move some services to being online only and therefore cut costs in other areas. You probably think that there aren't that many people without broadband, and you'd be wrong - according to the UK National Statistics Publication Hub there was at the end of 2008 only 56% of UK households with broadband access although 65% of households have an Internet connection of some form. This means there are around 11.14 million households without broadband access.
In 2008 an amazing 58% of people without any form of internet access had no need or want for the Internet which means there are "only" an estimated 4.68 million households without Internet access who actually want it. This means the new initiative will be a positive for approximately 18.5% of UK households.














I'm not sure that it's subsidized at all here in the states. I think what happened was that there were subsidies in place to lay the networks years ago and regulations requiring telecom companies to share their infrastructure with the competition, so pricing is a little more competitive. Despite this most rural areas have limited access, so part of Obama's recent stimulus bill includes funding for that.
Meanwhile, everytime I use my laptop someone that there isn't free wifi, I can't help but feel like we should be there by now :P