The government's advisory group on broadband and digital convergence has warned that ministers and the Ofcom watchdog must map out a path for next generation broadband within the next two years or UK competitiveness will suffer.

A report from the Broadband Stakeholder Group (BSG) warns that the UK's current and planned broadband infrastructure may not meet the future needs of intensive users.

It cannot be assumed that the market will continue to deliver the increasing bandwidth required by content providers, the report adds. The BSG wants to see broadband services capable of providing more than 20Mbps downstream capacity – enough to carry multiple high-definition TV feeds, internet and voice services.

Although networks capable of delivering much higher access speeds are now being deployed in other countries, there "seems to be little prospect" for the widespread deployment of next generation broadband in Britain, the BSG warned.

BSG chair, Kip Meek said: "We have a limited window of opportunity: if steps are not taken within the next year to prepare for next generation broadband, then we may well find ourselves in a position where it is too late to catch up."

The report calls on the government to establish a target to ensure that the UK remains in the upper quartile of Organisation for Economic Co-operation and Development nations in the quality and reach of broadband services by 2012.

It also recommends that Ofcom sets out the principles of its regulatory approach to next generation broadband within the coming year, in order to achieve a balance of investment incentives and competition in the market.