The initiative is part of minister for communications, technology and broadcasting Lord Carter’s Digital Britain report.
Currently only 40% of UK households have broadband. It is believed the digital divide runs along economic lines, with the poorest areas least likely to be connected.
There is also speculation that the cost of providing broadband connections, which has been the responsibility of BT, will be shared across the industry.
Other suggestions in the report are believed to include minimum broadband speeds and regulations to protect children using social networking sites. The government is also looking at the creation of a consumer-funded quango dedicated to halting illegal file sharing.
In addition to broadband development, former Ofcom chief Carter is also outlining plans for public service broadcasting and digital radio.
The future funding of Channel 4 is a key issue. Carter is expected to set out the government's position on whether the broadcaster should be merged with another company, and whether that company should be BBC Worldwide or Five.
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