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Broadband Enabled UK Homes Forecast Shrinks by 2 Million for 2016

Monday, December 9th, 2013 (10:44 am) - Score 874

Telecoms analyst Point Topic has slashed its prediction, which originally forecast that the United Kingdom would be home to just under 26m broadband lines at the end of 2016, by “almost” 8% to 23.88m due to the strain on disposable incomes and delays to the Broadband Delivery UK (BDUK) deployment of BT’s superfast broadband (FTTC/P) network.

At present the Government is spending £1.2bn to ensure that 95% of the country can access a fixed line superfast broadband connection by 2017. But the original aim was for 90% to gain access to related connectivity by 2015 and the government now expects to hit around 88% in December 2015, although it could still conceivably achieve 90% within the original timetable.

Indeed despite all of the recent media attention and reports of significant delays it’s worth noting that some BDUK schemes are actually running several months ahead of schedule and in fact 88% is still only 2% off the original target, which isn’t at all bad for such a complicated project (though it’s still guesswork as to whether all 90% will truly receive real-world “superfast” speeds of 25Mbps+). Never the less Point Topic has decided to scale back its own forecast.

Oliver Johnson, CEO of Point Topic, said:

There are two primary reasons. The remaining pool of offline households are proving difficult to convert with disposable income for example struggling to recover but the delay in the BDUK deployment has to take a share of the blame.”

Point Topic now expects there to be 9.4 million fibre optic based (FTTx – FTTC/P/H/B etc.) lines in the UK in 3 years’ time, almost 12% lower than previously forecast, and by 2020 it predicts this to reach 20 million (note: more than 23 million will be classified as “superfast households” when you include cable etc.).

Come 2020 there will be 25.41 million broadband lines, which suggests that superfast connections should have successfully cannibalised most of today’s market (i.e. gobbling up slower ADSL subscribers through migrations). Meanwhile cable services, such as those provided by Virgin Media, have only expanded their reach at a very slow pace and it doesn’t look like that’s going to change (Virgin can avoid heavy Ofcom regulation by limiting their network coverage).

broadband uk forecast to 2020
NOTE: Vertical Axis is % Growth

The forecast also suggests that most UK homes will be happy with their FTTC and cable (DOCSIS3 / EuroDOCSIS) based service speeds, which could mean that “consumer demand will likely be low” for the faster next generation replacements (e.g. G.fast and DOCSIS3.1 etc.). At least it will until such time as the content markets inevitable force yet another change in demand.

Point Topic has also called for there to be “more transparency on infrastructure and costs” in the Government’s Broadband Delivery UK (BDUK) process, which would allow for greater scrutiny of precisely how and where BT are spending the massive wad of state aid. But so far successive governments have tended to resist such calls and BT has preferred to keep the details under lock and key, which isn’t surprising for a commercial company.

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Mark Jackson
By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.
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