Fujitsu has walked away from bidding for a slice of the £530m Broadband Delivery UK (BDUK) pie that the government set aside to improve the country's broadband network.
The move leaves incumbent BT as the only provider to have successfully secured state investment to date for the project.
"At the moment there are no bids outstanding but we are committed to bidding in the future and we will look at each invitation to tender on its own merits," a Fujitsu spokesman told The Register.
The Financial Times was first to report this morning that Fujitsu had withdrawn from chasing BDUK funds and the move comes just a week after broadband minister Ed Vaizey confirmed that the process was effectively a two-horse race between the Japanese tech giant and BT.
Fujitsu's retreat from tendering for the money to bring faster broadband networks to rural areas in the UK will be an embarrassment for the government as the timing of its withdrawal is undoubtedly a bit awkward.
Earlier this month, competition officials in Europe stalled the government's plans to lay superfast fibre optic networks for 90 per cent of homes and businesses in the country by 2015 amid antitrust concerns about the BDUK bidding process.
Brussels hands out state aid to help fund the building of new broadband networks in Europe, but it is proposing the "easing [of] some conditions for investments in rural areas."
Here in Blighty, many smaller telcos have complained about the complex process of applying for funding from the government to bring faster broadband networks to hard-to-reach areas in the country.
Originally, nine suppliers were bidding for BDUK funds. It was eventually whittled down to just two contenders - Fujitsu and BT, prior to today's revelations about the Japanese company's withdrawal.
To date, Fujitsu had only bid for two regional tenders: Cumbria and North Yorkshire. BT is expected to bag both of those contracts.
In June, Cumbria County Council rejected offers from BT and Fujitsu and granted them both until September this year to come up with a better deal for the local authority.
The government handed funding for the project to Cumbria council nearly two-and-a-half years ago with the contract understood to be worth around £40m once private investment is factored in.
"The BDUK process has generated substantial interest among local opinion formers and so has been very helpful given the importance of local engagement," a BT spokesman told El Reg.
"BT will continue to bid for BDUK funds across the UK unlike others who have seemingly decided to cherry pick by focusing on the areas that are easiest to reach," he retorted. ®