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Oftel Q1 Report - 45% UK Homes Online

Posted: 13th May, 2003 By: MarkJ

Oftel has issued its latest quarterly residential and business Internet use report for 2003. The report finds that 45% of homes have Internet access, 14% of which use broadband, with the average household spending 10 hours online each week!:

Summary findings

Headline figures

* 45% UK homes have Internet
* 14% Internet homes using broadband
* Average Internet home spending 10 hours online each week
* 91% Internet homes satisfied with their overall service

Rise in Internet penetration, after months of stability

2.1 Home Internet penetration has risen to 45% since November 2002, having previously been stable at about 42% during the previous nine months. PC ownership rose insignificantly, indicating that this recent rise in Internet was driven primarily by homes who previously had a PC.

Cost barriers to Internet access for 1 in 5 homes, and significant minority still not interested in Internet

2.2 A further 1 in 10 homes thought they were likely to get Internet in the next 12 months. 1 in 5 homes were deterred by cost barriers (primarily the cost of equipment), and a similar proportion were not interested in Internet for other reasons (mainly perceptions of lack of need).

General Internet usage continues to rise

2.3 General household time spent online continues to rise, up by two-thirds during the last three years, currently the average Internet home spends 10 hours online each week. This ranges from 5 hours in metered homes, to 18 hours in broadband homes. In total about 3 in 10 Internet homes have the ability to make calls at the same time as using the Internet (either via broadband, ISDN, or multiple PSTN lines).

Broadband ISP choice driven by cost and familiarity, majority are not attracted by single billing

2.4 General advertising was the main source of information about broadband suppliers, few customers had been contacted directly by their ISP either via phone or information with their phonebill.

2.5 Cost and familiarity (ie using the supplier already) were the main drivers of ISP choice, with significant differences between BT and cable customers. 3 in 10 Internet customers said they would prefer a single phone / Internet bill. This was significantly lower amongst broadband customers, the majority of whom had not considered this when deciding which ISP to use.

At least 4 in 5 broadband customers would tolerate a 10% price increase

2.6 Broadband penetration continues to rise, currently 14% of Internet homes use broadband. Most broadband customers had upgraded from unmetered narrowband services. Although speed primarily drives the initial decision to get broadband, once connected customers experience and value the benefits of simultaneous usage, permanent connection, and enhanced content. 4 in 5 broadband customers claimed they would continue to use broadband if prices rose 10%. The perceived value of the faster speeds was the main reason for this decision.

More interested in getting broadband, other would want lower prices

2.7 A quarter of PSTN Internet customers thought they might get broadband at current prices. Cost and light Internet usage were the main reasons for not getting broadband. A third of all Internet homes were unsure what price if any would attract them to broadband, and of the quarter who thought they might consider broadband at a lower price, most said it would need to fall to under £20. This figure however is deflated by light users, and does not necessarily reflect realistic perceptions of an acceptable price.

Improvements in satisfaction with speed, reliability and value for money, as more move to broadband

2.8 Overall satisfaction with Internet services remains stable at just over 9 in 10, whilst satisfaction with speed, reliability and value for money all experienced slight improvements on last quarter, partly due to increasing broadband take-up.