Regulator approves Deutsche Telekom plan to use copper wires for broadband

* Watchdog approves 1 bln euros investment by 2018

* German government wants to boost download speeds to 50 Mbps

* Germany ranks 14th in Europe with 11 Mbps average - study (Adds details on government targets, vectoring technology, competitors)

By Harro Ten Wolde and Peter Maushagen

FRANKFURT, Nov 23 (Reuters) - Germany's telecoms industry regulator has given approval for Deutsche Telekom (Xetra: 555750 - news) to spend a billion euros ($1.1 billion) on equipping its existing copper wiring for high speed broadband services, to help Germany close its gap in consumer Internet speeds with other European countries.

The regulator said in a draft decision on Monday that approval was only conditional on Deutsche Telekom giving its competitors, which include Vodafone and Telefonica (Amsterdam: TA6.AS - news) Deutschland, access to the new technology.

But it can deny access in areas where alternative networks are available.

The German government wants all households to have access to Internet speeds of at least 50 Megabits per second (Mbps) by 2018.

That compares with an average of almost 11 Mbps at the moment, according to data from Akamai Technologies Inc (NasdaqGS: AKAM - news) , a provider of services that help deliver Internet content faster.

Germany ranks 14th in Europe, according to the data, behind countries such as United Kingdom, Romania and leader Sweden with averaged speeds of 11.8 Mbps, 12.8 Mbps and 16.1 Mbps respectively.

Deutsche Telekom's planned upgrade will be done through a process called vectoring, a technology that makes it possible to double the bandwidth of the individual copper lines to take services into homes and businesses from optic fibre-connected central distribution points.

It (Other OTC: ITGL - news) is far cheaper than running new fibre all the way into each individual premise, which currently allows download speeds of around 200 Mbps, and will give Deutsche Telekom a better position in its battle with cable operators, who can offer speeds many times faster.

The German government has estimated that in the next 20-25 years as much as 80 billion euros would be needed to roll out a German fibre optic network.

In the meantime, Deutsche Telekom is upgrading its copper lines to facilitate download speeds of up to 100 Mbps.

The technology can only be installed by one operator in each street cabinet, which houses the final connection to the customer's premises. After that, the new infrastructure can be used by all operators.

Under the latest approved investment Deutsche Telekom is targeting almost 6 million homes, with about 1 billion euros expected to be invested in the project by 2018.

Vodafone-owned Kabel Deutschland (Other OTC: KBDHY - news) and Liberty Global (NasdaqGS: LBTYA - news) 's Unitymedia are chipping away at Deutsche Telekom's share of the broadband market with faster, cheaper offerings.

Their cable lines, designed to deliver TV to homes, have been upgraded to carry voice calls and Internet at speeds often five times faster than competing services. ($1 = 0.9409 euros) (Editing by Georgina Prodhan and Greg Mahlich)