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Ofcom's Communications Market 2006

Posted: 10th Aug, 2006 By: MarkJ
Ofcom has released its 2006 Communications Market Report, which covers the state of UK telecommunications and media (TV etc.) services. The data is based off information gathered up to March 2006. We've highlighted the ISP related bits below, which reveal some interesting titbits about how few users understand data caps:

3.1.2 Broadband gets faster, but some consumers are unaware of limitations

By the end of March 2006, there were 11.1 million broadband connections to homes and smaller businesses in the UK, making it a truly mass-market product for the first time. DSL broadband at a minimum of 512kbit/s is now available to over 95% of homes and businesses in the UK, in addition to the 45% of UK homes passed by cable broadband.

In addition to widespread availability, consumers now have an increased choice of broadband service providers. Over DSL, BT has for many years provided wholesale access to alternative ISPs via its DataStream and IPStream products, essentially enabling these other ISPs to resell retail services over BT access lines. During 2005 and the first half of 2006, alternative DSL operators also stepped up their investments in local loop unbundling (LLU), which enables them to take over exchange lines from BT and offer their own broadband products to consumers. LLU is discussed in more depth in section 3.2.3. BT itself introduced a new combined broadband and wireless IP telephony product in June 2006 – the first time that a major UK broadband ISP has fully integrated voice over IP (VoIP) into its offering.

Together with the cable operators and the fast-growing wireless broadband sector, consumers have never had more choice of broadband products, pricing packages and access platforms. This in turn has fuelled the growth of broadband take-up and consumption.

In general, consumers in the UK are becoming increasingly familiar with broadband and the issues surrounding it. However, our research indicates that the majority of consumers are still unaware of two issues that might affect their user experience: contention ratios and usage caps.

Both terms are defined and discussed in length in section 3.4; in short, contention ratio is a measure of the number of users simultaneously sharing bandwidth, and usage caps are limits on the volume of data that each user can download in a given time period (usually per month). Both contention ratios and usage caps are near-ubiquitous in broadband service agreements. Most users are either unaware of the terms and/or the underlying concepts, or have an incorrect understanding of how these terms apply to them. For example, 90% of all adults with broadband connections had never heard the term “contention ratio”. Similarly, over 70% believed that there was no usage cap on their broadband connection.

At present, the broadband user experience is rarely affected by either contention ratios or usage caps, apart from for users who regularly download large amounts of content. To date, internet operators have progressively introduced more capacity into their broadband networks to minimise the impact on end-users. However, the twin issues of contention ratios and usage caps could become more significant as increasing numbers of consumers start to use high-speed broadband connections, 110 particularly for services such as streaming TV which require large volumes of data at a constant delivery rate.


The full Telecommunications part of the report can be read here. It's well worth a read, provided you have the time:

http://www.ofcom.org.uk/research/cm/cm06/telec.pdf
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