The government's broadband strategy risks leaving many communities behind by focusing on speed over reach of service, a Lords committee has warned.
The UK could miss out if fast internet services are not treated as a key national asset, the communications committee said in a report.
The government has promised the best superfast broadband in Europe by 2015.
But the Lords committee said its strategy was misguided and the priority should be to close the digital divide.
It said it had found there was "a very real risk that some people and businesses are being left behind, that inadequate access to the internet and all its benefits is actually afflicting their daily lives".
Peers congratulated the government for making enhanced broadband a priority but said it had proceeded from a "flawed prospectus" and become "preoccupied with the delivery of certain speeds".
"The delivery of certain speeds should not be the guiding principle; what is important is the long term assurance that as new internet applications emerge, everyone will be able to benefit, from inhabitants of inner cities to the remotest areas of the UK," they said in the report.
The report calls for the creation of a network of fibre-optic hubs, which would get fast broadband to local communities and businesses when they wanted it.
The peers said broadband should be treated as a vital national asset, like roads, rail and energy.
In the March Budget, the government confirmed the 10 cities which would become "super-connected" as part of a £100m investment announced in the Autumn Statement 2011.
It said it would also provide an additional £50m to fund a second wave of 10 smaller cities.
Ministers hope that the investments in cities will provide ultrafast broadband coverage to 1.7 million households and high-speed wireless broadband for three million residents by 2015.
