Ofcom – UK Superfast Broadband Uptake Grows to 44% as Satisfaction Falls

The annual 2017 Communications Market Report (CMR) has today been published, which reveals the latest information about the take-up and impact of Broadband, Mobile, Phone, TV and Radio services across the United Kingdom (England, Scotland, Wales and N.Ireland).

The regulator’s report is colossal in size and due to that we’ll tighten our focus by summarising the fixed line broadband, Mobile (3G / 4G) and Internet connectivity side. However it’s worth pointing out that the annual report no longer includes coverage data for digital networks, which has instead been left to the regulator’s annual Connected Nations report (the 2017 update is due before Xmas).

Nevertheless Ofcom found that total fixed broadband connections have increased by 0.6 million to 25.3 million since last year and the take-up of fixed 30Mbps+ capable “superfast broadband” services (available to est. 93% of UK premises) has increased to 44% (up from 38%), which equates to around 10.8 million connections. As usual most “superfast” lines in the UK are delivered by either Openreach’s (BT) FTTC/P “fibre” or Virgin Media’s cable (HFC EuroDOCSIS/FTTP) network.

Elsewhere there are now 92 million mobile subscriptions in the UK (including M2M services) and 52.4 million of those connect via the latest 4G technology. The average data (Mobile Broadband) use per mobile connection has also increased by 44% over the last year to 1.3GB (GigaBytes), which compares with 132GB on fixed line residential broadband connections (same data as in the 2016 Connection Nations study).

The Government currently expects all of the primary Mobile Network Operators (MNO) to deliver at least 85% geographic coverage of Mobile Data by the end of 2017 (here) and EE has pledged to beat that by hitting 92% in September 2017, which will then rise to 95% by the end of December 2020.

We should point out that the figure for “average actual fixed broadband speed” (36.2Mbps) is taken from Ofcom’s April 2017 speeds study (here) and thus, much like some of the other information above (e.g. monthly data use), it hasn’t been updated since last year. We’ll have to wait for next year’s report in order to get the latest figure.

In terms of money, the average household spend on telecoms services (i.e. fixed voice, internet and mobile) increased by £0.80 (0.9%) in real terms in 2016, to £85.26 per month. This increase was primarily due to an 11.8% increase in average monthly spend on fixed internet (broadband) access, caused mainly by the continued migration to superfast broadband connections.

Overall, spend on telecoms services accounted for 3.8% of the average total household spend during the year. Interestingly the spend on fixed voice (phone line rental) services was flat in 2016, despite a significant fall in use (outbound fixed call volumes declined by 11.9% during the year), which was due to increasing line rental and call prices.

Meanwhile the average spend on mobile voice and data service fell in 2016, down £1.03 in real terms to £45.60 per month.

Ofcom also noted that rising superfast broadband take-up is driving fixed internet revenue growth, resulting in a 9.9% real-terms increase during 2016 to £5.7bn (up from £5.2bn in 2015 and £4.6bn in 2014). This is hardly a surprise because superfast packages tend to cost a few pounds more per month than standard broadband (anything from around +£4 to +£20 extra, depending upon ISP).

Unfortunately Ofcom’s report also found that consumer satisfaction with fixed broadband has fallen. The proportion of respondents who said they were “very” or “fairly” satisfied with their overall fixed broadband service was 84% in 2017, which is down three points from 2016.

However, it’s interesting to note that this fall in satisfaction doesn’t appear to be caused by issues with service speed (at least not directly). Instead Ofcom suggests that the strain being put on ISP networks by rising levels of video streaming could be to blame, although it’s a tricky one to judge.

The report also notes that 81% of households reported purchasing at least two of their communications services together, from the same supplier, in a bundle in 2017, which is up slightly from last year (79%). We also scoured the regulator’s report for any specific details on “ultrafast broadband” (defined by Ofcom as 300Mbps+) uptake or use but unfortunately came up empty.

Finally, Ofcom’s study for the first time revealed that there are around 80,000 subscribers using a Satellite broadband service in the United Kingdom.

The report covers a huge amount of different areas and so we recommend reading the full publication (linked at the bottom). However we did find some other interesting details, which have been summarised in the table below.

2017 Communications Market Report (CMR)
https://www.ofcom.org.uk/research-and-data/multi-sector-research/cmr/cmr-2017

UPDATE 10:39am

The Office for National Statistics has separately published their annual Internet Access – Households and Individuals 2017 report, which covers many of the same areas as Ofcom’s study. It notes that in Great Britain 90% of households have Internet access (up from 89% last year).

However that still leaves 10% of households with no Internet access and it’s noted that 64% of those felt as if they didn’t need the internet (i.e. it was regarded as not useful or interesting), while a further 20% felt they lacked skills and 12% reported that they had access to the internet elsewhere.

Elsewhere 73% of adults had used the Internet “on the go” using a mobile phone or Smartphone device, which is up from 70% last year. Similarly 77% of adults bought goods or services online, up from 53% in 2008.