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United Kingdom - Telecoms, IP Networks, Digital Media and Forecasts


Attention: There is an updated edition available for this report.

This report covers the UK representing key and influential telecom markets. The report analyses trends and developments in telecommunications, mobile, Internet, broadband, digital TV and converging media including VoIP, VoD and IPTV developments. Subjects include:

  • Market and industry analyses, trends and developments;
  • Facts, figures and statistics;
  • Industry and regulatory issues;
  • Infrastructure;
  • Major players, revenues, subscribers, ARPU, MOU;
  • Internet, VoIP, IPTV;
  • Mobile voice and data markets;
  • Broadband (FttH, DSL, cable TV, wireless);
  • VoIP, IPTV, VoD, digital TV and DTTV
  • Convergence and digital media;
  • Teclecom market forecasts for selective years until 2014 and 2018.


BuddeComm’s annual publication, United Kingdom - Telecoms, IP Networks, Digital Media and Forecasts, provides a comprehensive overview of the trends and developments in the telecommunications and digital media markets in the UK.  

The UK’s telecom market has not been unscathed by the global economic downturn, which has pushed the economy into one of the deepest recessions experienced by any European country. Overall revenues in the telecom sector increased by only 0.5% year-on-year in 2008, to about £43 billion, considerably lower than the 4% growth seen in 2007. Competition has continued to drive down the price of overall telecom services by about 6% annually, yet the real economic hardship of many consumers will significantly reduce discretionary spend until at least 2011. The consequent decline in revenue for telcos, together with the still problematic liquidity market, will dampen their ability to fund network investment during the next two years. BT has been an early casualty, having been obliged to scale back its 21CN All-IP implementation.  

Nevertheless, the telecom sector remains resilient by comparison with other market sectors, if only because consumers are steadfastly attached to communications services. This has been recognised by the government’s proposal to make the provision of broadband a universal service obligation by 2012, though it is unlikely that the timetable will be kept to.  

Fixed-line penetration has fallen steadily since 2000 while mobile penetration has increased to the extent that by mid-2009 about 20% of households relied on mobile-only access, compared with only 6% in 2001. Average residential broadband speeds more than doubled in the year to June 2009 yet there remain poorly served areas, accounting for some 15% of all households. BT dominates the fixed market, accounting for about 47% of all connections, though O2 is the largest overall provider in terms of subscribers.

  The digital TV market is among the most competitive in Europe, with both free and pay satellite services competing against a range of platforms providing IPTV and VoD services. Analogue switch-off, due by 2012, is much anticipated as broadcasters and the providers of mobile and broadband services look to acquire released spectrum and so expand their service offerings in coming years.  

UK key telecom parameters - 2008 - 2009
Sector | 2008 | 2009 (e) |
Broadband |   |   |
Fixed broadband subscribers (million) | 17.3 | 18.1 |
Fixed broadband penetration rate | 28% | 29% |
Mobile broadband subscribers (million) | 1.6 | 3.8 |
Subscribers to telecoms services |   |   |
Fixed-line telephony (million) | 33.2 | 32.4 |
Mobile phone (million) | 76.8 | 78.3 |
Mobile penetration (population) | 126% | 131% |
| (Source: BuddeComm)

  Key highlights:

  • Local loop unbundling has grown substantially since 2006, and by August 2009 there were more than six million unbundled lines. With more than 20 telcos providing unbundled services from over 1,850 local exchanges, competition in urban areas is intense, leading to some of the lowest broadband prices in Europe. Consolidation among providers in recent years has meant that the broadband market is essentially served by a triopoly of BT, Carphone Warehouse and Virgin Media, which together hold some 75% of all fixed-line subscribers. The economics of scale will enable them to reduce access prices further in coming years as they face increasing competition from the mobile network operators.
  • The 2009 Digital Britain report which proposed a universal broadband service of 2Mb/s by 2012 will require public funds, sympathetic regulation and the re-use of sub-1GHz spectrum freed from digital switchover. The much delayed spectrum auctions will hamper this development in 2010, requiring tighter regulatory control.
  • Long-term evolution trials have kept pace with developments elsewhere in Europe, led by O2 which envisages providing data at 140Mb/s, or ten times the speed currently available. The success of LTE will be much needed during 2010 and 2011 to develop rural broadband access as well as provide a platform for MNOs to develop their mobile data services.
  • Virgin Mobile launched one of Europe’s fastest cable networks during 2009, and may upgrade to a 200Mb/s service by 2012. This will vastly improve the accessibility of high-end data services while the rollout of FttH is unlikely to expand substantially during the next two years.
  Data in this report is the latest available at the time of preparation and may not be for the current year.

1. Key Statistics
2. Telecommunications Market
2.1 Overview of the UK’s telecom market
3. Regulatory Environment
3.1 History
3.2 Regulatory authority
3.2.1 Office of Communications (Ofcom)
3.2.2 Ofcom’s strategic review
3.3 BT’s structural separation
3.3.1 Openreach
3.4 Telecom sector liberalisation in the UK
3.4.1 Privatisation of British Telecom
3.4.2 Interconnect
3.4.3 Access
3.4.4 Number Portability (NP)
3.4.5 Carrier PreSelection (CPS)
3.4.6 Wholesale Line Rental (WLR)
4. Major Fixed Network Operators In The UK
4.1 New regulations
4.2 British Telecom
4.2.1 Company restructure
4.3 KCOM
4.4 Cable & Wireless (C&W)
4.5 Virgin Media
4.6 COLT Telecom
4.7 THUS
4.8 Carphone Warehouse
4.9 Post Office re-entry
4.10 Orange
4.11 BSkyB
5. Telecommunications Infrastructure
5.1 National telecom network
5.2 Next Generation Networks
5.2.1 Cable & Wireless
5.2.2 COLT
5.2.3 BT’s 21CN
5.2.4 Cable telephony
5.2.5 Fibernet
5.3 International
5.3.1 Submarine cable networks
5.3.2 Satellite networks
6. Broadband Market
6.1 Overview
6.1.1 Emerging trends
6.1.2 Super-fast broadband
6.1.3 Government support
6.2 Cable modems
6.3 Asymmetrical Digital Subscriber Line (ADSL)
6.3.1 BT products
6.3.2 Broadband consumer access
6.3.3 Broadband providers
6.3.4 ADSL2+
6.3.5 SDSL
6.3.6 VDSL
6.4 Fibre-to-the-Home (FttH) networks
6.4.1 Costing fibre
6.4.2 Fibre access and Community Broadband Access networks
6.4.3 BT
6.4.4 Other developments
6.5 Broadband Powerline (BPL)
6.5.1 Broadband over the Electricity Network (BoEN)
6.5.2 Scottish and Southern Energy (SSE)
6.6 Wireless broadband
6.6.1 Regulatory environment
6.6.2 Spectrum 900/1800MHz
6.6.3 Spectrum 1452/1492MHz
6.6.4 Spectrum 2.6GHz
6.6.5 Spectrum 3.4GHz
6.6.6 Spectrum 5.8GHz
6.6.7 Spectrum 10GHz
6.6.8 Spectrum 28GHz
6.6.9 Spectrum 71-86GHz
6.6.10 Other spectrum awards
6.6.11 Digital dividend spectrum
6.6.12 WLAN/WiFi
6.6.13 WiMAX
6.6.14 Mobile broadband
6.6.15 Internet via satellite
7. Convergence
7.1 Overview of media convergence
7.2 Key general trends
7.3 Digital media
7.3.1 Business models - triple play
7.4 Regulator issues
7.4.1 Ofcom
7.4.2 Digital Dividend Review
7.4.3 Releasing dividend spectrum
7.4.4 DTTV pay services
7.4.5 Digital switchover licensing
7.5 Digital TV (DTV)
7.5.1 Broadband TV (IPTV)
7.5.2 Cable TV
7.5.3 Satellite TV
7.5.4 Digital Terrestrial TV
7.5.5 Video-on-Demand (VoD)
7.5.6 VoIP
7.5.7 Interactive TV
8. Mobile Communications
8.1 Overview of the UK’s mobile market
8.1.1 Mobile statistics
8.1.2 Operator market shares
8.2 Regulatory issues
8.2.1 Spectrum regulations and spectrum auctions
8.2.2 Roaming
8.2.3 Number portability
8.2.4 Mobile termination rates (MTRs)
8.3 Mobile technologies
8.3.1 Digital
8.3.2 Third Generation (3G) mobile
8.3.3 Fixed-Mobile Convergence (FMC)
8.4 Major mobile operators
8.4.1 Hutchison 3
8.4.2 O2
8.4.3 Vodafone
8.4.4 T-Mobile
8.4.5 Orange
8.4.6 Mobile Virtual Network Operators (MVNOs)
8.5 Mobile voice services
8.5.1 Prepaid cards
8.5.2 ARPU statistics
8.6 Mobile data services
8.6.1 Overview
8.6.2 Regulatory issues
8.6.3 Operator services - 3G
8.6.4 Mobile data services
9. Forecasts
9.1 Forecast broadband subscribers - 2007 - 2012; 2018
9.1.1 Scenario 1 - higher broadband subscriber growth
9.1.2 Scenario 2 - lower broadband subscriber growth
9.2 Forecast mobile ARPU - 2007 - 2010; 2014
9.3 Forecast UMTS subscribers - 2007 - 2010; 2015
10. Glossary of Abbreviations
List of Tables and Exhibits
Table 1 - Country statistics United Kingdom - 2009
Table 2 - Telecom revenue and investment statistics - 2008
Table 3 - Telephone network statistics - 2008
Table 4 - Internet user statistics - June 2009
Table 5 - Broadband statistics - January 2009
Table 6 - Mobile statistics - June 2009
Table 7 - National telecommunications authority
Table 8 - Communications retail sector revenue - 2003 - 2008
Table 9 - Household spend on telecoms services - 2004 - 2008
Table 13 - Share of call volumes, fixed-line and mobile - 2003 - 2008
Table 43 - COLT financial data - 2006 - 2009
Table 44 - THUS subscribers - 2006 - 2008
Table 45 - THUS financial data - 2004 - 2008
Table 46 - THUS financial data - 2009
Table 47 - Carphone Warehouse Group revenue, profit - 2007 - 2009
Table 48 - TalkTalk financial data - 2007 - 2009
Table 49 - BSkyB voice customers - 2006 - 2009
Table 50 - Fixed lines in service and teledensity - 1995; 1997; 1999 - 2009
Table 51 - Broadband retail revenue - 2003 - 2008
Table 52 - Broadband connections by type - 2002 - 2009
Table 53 - Internet connections by consumer group - 2003 - 2008
Table 54 - Market share of broadband subscribers by type - 2002 - 2008
Table 55 - Broadband availability by households - 2000 - 2009
Table 56 - Share of broadband subscribers by ISP - 2005 - 2009
Table 57 - Broadband penetration by technology - 2004 - 2008
Table 58 - Total broadband subscribers by type - 2004 - 2009
Table 59 - Broadband subscribers by type - incumbent or other provider - 2007 - 2009
Table 60 - Percentage Internet access by dial-up and broadband - 2000 - 2009
Table 61 - PC, broadband and Internet household penetration - 2000 - 2009
Table 62 - Value of e-commerce sales - 2007 - 2012
Table 63 - BT Openreach WRL lines - 2007 - 2009
Table 64 - Virgin Media ARPU - 2007 - 2009
Table 65 - Virgin Media broadband subscribers by speed of service - 2007 - 2009
Table 66 - Virgin Media financial data - 2007 - 2009
Table 67 - xDSL subscribers - 2000 - 2009
Table 68 - BT retail and wholesale broadband subscribers - 2004 - 2009
Table 69 - Mobile broadband connections - 2008 - 2009
Table 70 - Mobile broadband connection types and usage - 2008
Table 71 - Mobile broadband market share - September 2008
Table 72 - Availability of digital services - June 2009
Table 73 - Adoption of services - March 2009
Table 74 - Broadcast HD homes by provider - 2006 - 2009
Table 75 - Proportion of bundled services by type - 2006 - 2009
Table 76 - Proportion of homes with bundled services by type - March 2009
Table 77 - Statistical overview of digital TV market - 2006 - 2009
Table 78 - Market share of TV homes by platform (primary sets) - 2005 - 2009
Table 79 - Digital TV uptake, share of main TV sets - 2005 - 2009
Table 80 - BT Vision subscribers - 2007 - 2009
Table 81 - Free-to-view satellite households - 2003 - 2009
Table 82 - BSkyB subscriber statistics - 2005 - 2009
Table 83 - BSkyB annualised ARPU - 2005 - 2009
Table 84 - BSkyB revenue, operating profit and annual change - 2007 - 2009
Table 85 - Homes equipped for DTTV - 2006 - 2009
Table 86 - DTTV equipment sales - 2005 - 2009
Table 87 - Cumulative DTTV equipment sales - 2006 - 2009
Table 88 - Online TV revenue - 2005 - 2008
Table 89 - Virgin Media VoD use - 2007 - 2009
Table 90 - Virgin Media V+ base - 2008 - 2009
Table 91 - VoIP users as % of total Internet subscribers - 2005 - 2008
Table 92 - BT VoIP subscribers - 2006 - 2008
Table 93 - Mobile and fixed-line voice traffic and total traffic in minutes - 2005 - 2009
Table 94 - Mobile call revenue by operator - 2002 - 2009
Table 95 - Mobile retail revenue by service - 2002 - 2008
Table 96 - Mobile revenue as proportion of total - 2002 - 2008
Table 97 - Average cost of mobile services by type - 2003 - 2008
Table 98 - Mobile handset sales - 2005 - 2009
Table 99 - Mobile operator and subscribers - June 2009
Table 100 - Mobile subscribers and penetration rate - 1995; 1997; 1999 - 2009
Table 101 - Percentages of mobile and fixed phones in homes - 2000 - 2009
Table 102 - Mobile subscribers by operator - 2000 - 2009
Table 103 - Mobile retail revenue by operator - 2000 - 2009
Table 104 - Mobile ARPU by sector - 2000 - 2008
Table 105 - Mobile share of outbound calls - 2002 - 2008
Table 106 - Average mobile charges by service - 2000 - 2007
Table 107 - Mobile market share by operator - 2004 - 2009
Table 108 - Mobile operator share of revenue - Q2 2009
Table 109 - European roaming charges - 2007 - 2009
Table 110 - Mobile numbers ported - 2003 - 2005
Table 111 - MTRs by operator - 2009 - 2011
Table 112 - 3 UK and Ireland subscribers by sector and annual change - 2008
Table 113 - 3 UK and Ireland revenue; annual change - 2008
Table 114 - O2 financial data -2007 - 2009
Table 115 - O2 quarterly ARPU - blended, contract, prepaid and data - 2006 - 2009
Table 116 - O2 subscribers, prepaid and contract - 2005 - 2009
Table 117 - Vodafone ARPU: blended, contract and prepaid - 2005 - 2009
Table 118 - Vodafone mobile non-voice as % service revenue - 2005 - 2009
Table 119 - Vodafone 3G and live! subscribers - 2005 - 2009
Table 120 - Vodafone (UK) subscribers and proportion prepaid - 2001 - 2009
Table 121 - Vodafone (UK) financial data - 2008 - 2009
Table 122 - Vodafone Group revenue by sector - 2007 - 2009
Table 123 - Vodafone (UK) service revenue by sector - 2008 - 2009
Table 124 - T-Mobile financial data - 2005 - 2009
Table 125 - T-Mobile subscribers - 2005 - 2009
Table 126 - Orange subscribers, contract and prepaid - 2006 - 2009
Table 127 - Orange subscribers by type, retail, 3G, MVNO - 2006 - 2009
Table 128 - Orange revenue - 2005 - 2009
Table 129 - Orange ARPU by category - 2006 - 2009
Table 130 - MNO and MVNO share of subscribers - 2004 - 2008
Table 131 - Virgin Mobile subscribers - 2005 - 2009
Table 132 - Virgin Mobile financial data - 2007 - 2009
Table 133 - Carphone Warehouse subscribers - 2007 - 2009
Table 134 - Carphone Warehouse mobile revenue - 2006 - 2009
Table 135 - Percentage of prepaid customers per operator - 2003 - 2008
Table 136 - Average cost per mobile minute - 2002 - 2009
Table 137 - Prepaid and contract subscribers - 2002 - 2008
Table 138 - Mobile retail ARPU by service - 2002 - 2008
Table 139 - ARPU by subscription type - 2002 - 2008
Table 140 - 3G subscribers and percentage of total subscribers - 2003 - 2009
Table 141 - 3G subscriber penetration rate - 2003 - 2009
Table 142 - 3G licence results - April 2000
Table 143 - 3 UK and Ireland subscribers by sector and annual change - 2008
Table 144 - 3 UK and Ireland revenue and annual change - 2008
Table 145 - Vodafone 3G subscribers - 2005 - 2009
Table 146 - Average ARPU per data service - 2009
Table 147 - Vodafone live! subscribers - 2005 - 2007
Table 148 - Total and average text messages sent - 1999 - 2008
Table 149 - Average SMS and MMS sent per month - 2003 - 2008
Table 150 - SMS and MMS revenue by operator - 2006 - 2008
Table 151 - SMS and MMS volumes by operator - 2006 - 2009
Table 152 - Mobile broadband connections - 2008 - 2009
Table 153 - Mobile broadband connection types and usage - 2008
Table 154 - Mobile broadband market share per operator - September 2008
Table 155 - Forecast broadband subscribers - higher market growth scenario - 2007 - 2012; 2018
Table 156 - Forecast broadband subscribers - lower market growth scenario - 2007 - 2012; 2018
Table 157 - Forecast mobile ARPU - 2007 - 2010; 2014
Table 158 - Forecast UMTS subscribers - 2007 - 2010; 2015
Exhibit 1 - EU New Regulatory Framework (NRF)
Exhibit 2 - Principal submarine cables from the UK - 2009
Exhibit 3 - BT’s wholesale DSL products - 2008
Exhibit 4 - Estimated cost of fibre by deployment technology - 2009
Exhibit 5 - Wireless opportunities using technology and frequencies
Exhibit 6 - Spectrum auction results 10GHz - February 2008
Exhibit 7 - WLAN operator business models - 2009
Exhibit 8 - Overview of media convergence
Exhibit 9 - Operators’ service bundling offers - 2009
Exhibit 10 - Technology developments in bundled services - 2009
Exhibit 11 - Snapshot of digital TV services and providers - 2009
Exhibit 12 - Digital broadcasting switchover timetable - 2008 - 2012
Exhibit 13 - Popular VoIP providers - 2009
Exhibit 14 - Spectrum available for mobile services

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