Tuesday, August 23, 2011

Key facts from Ofcom's 2011 Communications Market Report


Some interesting nuggets from Ofcom's 2011 Communications Market Report, published earlier this month.

On Internet access and broadband take-up:
  • For the first time household internet take-up (78%) has exceeded PC ownership (77%) as a small proportion of households went online using mobile phones only.
  • Take-up of broadband has continued to increase and in Q1 2011 stood at 74%. Virtually all homes with a computer are now connected to the internet.
  • Take-up of mobile broadband continues to rise and now stands at 17%.
  • While the majority of mobile broadband connections are purchased in addition to a fixed broadband connection at home, 7% rely solely on a mobile broadband service.
  • Dial-up internet connections, along with four/ five channel analogue terrestrial TV services, are now almost extinct.
  • Among those aged 65-74, five years ago only four in ten had internet access at home (42%), but by 2011, this had risen to over half of this age group (55%). However, still only a small minority (26%) of those aged 75+ have the internet at home in Q1 2011 (up from 15% in 2006).
An interesting contrast between broadband take-up in urban and rural areas:
  • Broadly speaking, higher levels of take-up in rural locations tend to run alongside higher levels in urban areas. Fixed-line services are the only deviation from this pattern, where take-up is higher – sometimes substantially – in rural locations. That said, there are some variations in take-up by location: broadband take-up among homes in rural areas is higher than in urban areas in England and Scotland, which is likely to relate to higher-income households in rural areas. In Q1 2011, rural areas in England had the highest level of broadband take-up, at 84%.
On the increasing importance of TVs and mobile phones in providing internet access:
  • At the device level, a range of television screens now incorporate an internet connection, and during 2010, 10% (1 million) of television set sales incorporated a connection to the internet. Services available on TVs with an internet connection include applications that access on-demand services such as BBC iPlayer, other ‘over the top’ content services such as LoveFilm and YouTube, and social networking sites including Twitter and Facebook.
  • More than three-quarters of households have home internet access: The ownership of a PC has always been a constraint on the take-up of home internet services, with the cost of the PC preventing some households from getting online and others saying they do not have the knowledge/skills to use a computer...However, the mass-market emergence of internet-enabled phones and internet services designed specifically for mobile phones (such as mobile applications) means that increasingly people are getting online through mobile phones. For the first time in Q1 2011 household internet take-up (78%) exceeded PC ownership (77%) as a small proportion of households went online via mobile phones only.
On increasing mobile broadband usage:
  • In addition to increasing take-up of internet services on mobile phones it appears that the intensity of use has increased significantly...the volume of mobile data transferred over the UK’s mobile networks increased by 67% during 2010, and increased forty-fold between Q4 2007 and Q4 2010. This suggests that the use of 3G/HSPA networks on smartphones is having a similar transformative effect on mobile internet use as that which happened in the early-mid 2000s on fixed-line networks with the migration from dial-up to broadband.
On superfast broadband:
  • Over half of all UK households are passed by super-fast broadband. Virgin Media’s cable service offers speeds of at least ‘up to’ 50Mbit/s to 48% of all households, with around 15% of households able to get an ‘up to’ 100Mbit/s service. BT’s ‘up to’ 40Mbit/s fibre-to-the-cabinet service was available to around 20% of households by July 2011 and Ofcom estimate that 57% of UK homes were able to receive super-fast services in July 2011.
  • Take-up of superfast services is increasing. Ofcom estimate that around 2% of residential and SME UK broadband connections had a headline speed of 30Mbit/s or higher at the end of March 2011, more than five times the figure for a year previously.
  • Ofcom consumer research indicates that take-up of super-fast broadband changes use of the internet. More than half of those taking up super-fast service say they have increased the number of standard-definition or high-definition TV programmes or films they watch over the internet (54% and 63% respectively), while many also claim to have increased the amount of online gaming (37%), video calling (39%) and file sharing (40%).
  • Value for money was the most important consideration when choosing a super-fast service: Even though super-fast broadband services are generally more expensive than slower services...value for money was the most important single reason for consumers choosing their current super-fast broadband service...Nearly half of all respondents said that good simultaneous performance on multiple devices was a reason for taking super-fast broadband, indicative of how households are increasingly using WiFi connectivity to provide internet connections to multiple devices, including desktop, laptop and tablet PCs, mobile phones, games consoles and internet-enabled televisions.
  • There is strong evidence that the take-up of super-fast broadband changes the ways in which consumers use the internet, as users benefit from the improved experience of services which benefit from faster speeds and the higher quality of service typically offered by super-fast services.
  • The largest increases in reported use relate to streaming TV programmes or full-length films; nearly two-thirds of respondents said that they had increased their levels of streaming high-definition content and more than half had increased their streaming of standard-definition content...There were also notable increases in some services which are less mainstream, including file-sharing and online gaming.
  • The lowest increases were for those services where use was already high, and which typically benefit less from having faster speeds: sending and receiving email, purchasing goods/services/tickets and banking.

Tuesday, August 02, 2011

Driving demand for NGA services


Some really interesting presentations from the workshop on financing and facilitating broadband projects held during the first Digital Agenda Assembly in Brussels on 16-17 June 2011.

The experience of Italian communications provider Fastweb in rolling out 100Mbps services provides particular food for thought in the light of current UK developments. From the report of the workshop:
“The lack of demand for switching to high speed services was identified as one of the most substantial challenges to the deployment of NGA networks by different stakeholders. The level of demand is a crucial factor shaping operators' business case. In particular, Fastweb's experience in FTTH Point-to Point deployment in the co-investment model illustrated the slow take up of the 100 Mbps retail product despite the price being comparable to the traditional offer.”
...which corroborates what I've heard elsewhere; that where next generation services are available in the UK, takeup is as yet very slow. It also underlines the need to communicate the benefits of next generation broadband in terms of the services and applications it makes possible, rather than to simply focus on headline speeds which will only excite a minority of people?