Up to 8Mb - why it all went wrong...
Mr Naismith points out a few ways part of this mess could be improved, the prime one being that ISP websites can currently make whatever outrageous claims they like and no one will do anything about it.
BTwholesale's "capacity based charging" (CBC) was where things started to go wrong. That's when BTwholesale's pricing policy changed from "line rental increases with line sync speed" and "interconnect to ISP = not too outrageous" to "line rental independent of line sync speed, interconnect = outrageous". The new pricing regime was chosen to be BT revenue-neutral at average usage of 20-50kbit/s. Ofcom approved this change, despite objections from clued-up ISPs like Zen who said it would destroy the quality of the broadband market.
ISPs then had to start seriously considering how best to pay for their overpriced interconnect to BT (this was at a time when Ofcom''s description of LLU as "widely available" meant six exchanges in London and one elsewhere). Pack more people in was the obvious conclusion for most ISPs. Impose caps etc was another option. Admitting that "unlimited" had gone forever wasn't on most ISP's agendas but the costing arithmetic made it inevitable that "unlimited" was now a lie.
Then the big boys started seeing that maybe LLU might actually be practical after all (LLU is too expensive for smaller ISPs to play on a national basis). So a few years later, we've got half the country's exchanges with LLU, with each big boy having functionally duplicated BTw's expensive broadband infrastructure, all of which needs to be paid for. Meanwhile in order to attract punters to pay for it, the big boys are offering "free" deals which aren't, and contracts are getting longer and longer. Across the market, LLU or not, headline prices are going lower and lower, and so is QoS in every sense of the word, because "free broadband" is very hard to compete with. It's also a lie, but Ofcom do nothing about it.
Meanwhile BT says "wtf are we going to do about LLU?". The regulatory regime is so daft that at one point BT Retail's head man, Pierre Danon, was talking about going LLU just to get BTwholesale's costs off his balance sheet. He found a new job shortly after that. Outside BT, obviously.
That still left BT with the problem of what to do about LLU competition, without spending any money. One thing they could do *relatively* easily was upgrade the line speeds between exchange and punter. There's no capital cost for that, just some changes to the relevant business and operational systems. It might leave the already-struggling "virtual pipes" from exchanges looking even Redder in the face than they traditionally were, but the ISPs can always be blamed for performance issues and no one will be any the wiser because no one's allowed to watch BTw closely enough, for "commercial confidentiality" reasons.
So, upgrade punters lines across the board to "up to 8Mbit" if they want, call it "ADSL Max" to make it sound good, but don't spend any money to significantly upgrade the backhaul to match, just hope that increased revenue from ISPs paying for more interconnect bandwidth will eventually pay for extra backhaul.
If marketed *honestly* this could still have been attractive: "your 2Mb broadband can now go even faster when there's spare capacity" - but there has to be spare capacity *all the way* between punter and ISP to see any benefit. And the interconnect between ISP and BT is now so expensive that for most ISPs except the most expensive there's no spare capacity to speak of, definitely not at times when people actually want to use t'Internerd, and several ISPS (led by Plusnet) start deploying at "traffic management" kit which prioritises "interactive" stuff (browsing) and selectively discards "low priority" stuff. By coincidence, by this time, Plusnet's head of broadband was Neil Armstrong who had previously been at BTw, where he'd architected capacity based charging. And not too long after that, Plusnet were taken over. By BT. Small world, eh.
All of which, strangely enough, happens with the full knowledge and apparent cooperation of Ofcom, and indeed under the watchful eye of El Reg (and also AdslGuide, which covered much of this on frontpage news articles and forum discussions which were ignored elsewhere). I wonder why Ofcom have changed their tune now?