Research Round-up February 2023
Fixed Broadband Subscriber Take-Up in the UK: Model and Key Findings; Broadband availability in the UK at end-2022; FTTP in the UK. Is it worth it?; Project Gigabit Winter Update; Ultrafast UK sector updates; ISP news; government and Ofcom updates
Point Topic’s key publications of the month:
Fixed Broadband Subscriber Take-Up in the UK: Model and Key Findings
Introduction
The Point Topic take-up model estimates fixed broadband market shares and subscriber numbers at the postcode level in the UK. This approach is unique in that it provides a postcode-level output of market shares based on our granular UK-wide broadband availability datasets, ISP subscriber numbers, speed test data and demographic data. Our model covers all the main infrastructure operators and retail ISPs, including Openreach, BT, Sky, Virgin Media O2, TalkTalk, KCOM, altnets (alternative networks), and resellers as well as ADSL, DOCSIS 3.1, RFoG, FTTP, FTTC and GFast technologies[1].
Gigabit-capable Networks
High market shares of gigabit-capable lines[2] at LSOA level are less common in vast swathes of the Southwest, East of England, Northeast, Northwest, and Scotland, where more rural areas and lower average income do have an effect on both gigabit broadband availability and take-up. See Figures 1 and 2 below for more information about nationwide market shares.
To get the full report (free of charge) please contact isabelle.anderson@point-topic.com
Broadband availability in the UK at end-2022
More than 2m premises can choose between 2 or more FTTP AltNets
Point Topic’s bi-monthly update on broadband infrastructure deployments in the UK, tracking the progress since our latest update for October 2022. We also look at key trends in the availability of ultrafast broadband in the last 12 months. The analysis is based on the ThinkPoint broadband availability dataset which includes 1.7m postcodes[3]. More granular, postcode level broadband availability updates by ISP and technology, are available to our ThinkPoint customers.
Key headlines:
As of the end of 2022, the overall FTTP coverage was almost 14m premises (43% of the UK total). This metric was up from 9m (29%) at end-2021.
The largest number of FTTP premises added during 2022 was in Sheffield (+87,709), while the largest growth in percentage of FTTP premises was in Broxtowe (+57.4%).
Among independent fibre networks (altnets) with at least 50K premises passed, Brsk had the highest annual growth, from just 1K premises at end-2021 to 100K at end-2022. CityFibre, Toob, Jurassic Fibre and Fibrus also more than doubled their fibre networks during 2022.
At end-2022, 134 local authorities (LAs) had two independent fibre providers overlapping, up from 125 two months earlier. Dundee City joined the league of the top LAs in this category, with two fibre providers covering 40K premises in the LA.
Across the UK, more than 1.3m premises could choose between at least three independent fibre ISPs. More than 2m premises had access to two or more independent fibre providers.
Despite significant progress, 28% of UK premises still did not have access to gigabit capable broadband, with this figure highest in Wales at 45%.
As of the end of 2022, the overall FTTP coverage, including Openreach FTTP network, independent fibre networks (altnets), Virgin Media O2’s RFOG network and KCOM was almost 13.7m premises (43.2% of the UK total). This metric was up from 9.2m (29.1%) at end-2021.
Table 1 lists top and bottom ten UK local authorities (LAs) by FTTP coverage in this period. Among the top ten LAs, Coventry saw the largest progress in terms of new FTTP premises added in 12 months (+14,688), while the largest growth in percentage of premises passed was in Derry City and Strabane (+11.9%). Among all LAs, the largest number of FTTP premises added was in Sheffield (+87,709), and the largest percentage growth was in Broxtowe (+57.4%).
The bottom ten LAs saw modest growth of between 0.5% and 2.5%. Most of them are not attractive targets for fibre investment, as they are either rural or remote, or both. On the other hand, these figures do not include Virgin Media O2’s Docsis 3.1 network coverage, which is widely available in some of these LAs such as Woking, for example.
The complete dataset used to produce this analysis is part of our ThinkPoint service which involves UK Broadband Mapping at postcode level. For more information check our UK Mapping page.
FTTP in the UK. Is it worth it?
There are question marks and some nerves apparent around the deployment of FTTP in the UK today.
Openreach reported only 2.5% growth in traffic in the last 12 months. Can you move enough customers from FTTC/your FTTP competitors quickly enough to satisfy investors?
Will the customer cut back (or pay more for) the upgrades? How quickly will they buy and which tier will it be and what does that mean for your bottom line?
Who will survive and how? Who are the safe bets and who will be under threat?
As is traditional the answer to all the above is ‘it depends’.
Using density plots of speed tests from our Thinkpoint product, rather than frequency to allow better comparison, this is what the last few years for FTTC have looked like.
We use There does appear to be some hunting for bandwidth from 2019 to 2023 with the peak at 70+Mbps growing as more users subscribe to the upper tiers. Around 7% of test counts shifted from the lowest to the medium (2% gain) and the highest (5%) tiers from 2019 to 2023 (q1).
FTTP is still settling down in our data as the ISPs update offerings, target specific areas and look to move early adopters up the tariff tiers or even sell them bundles.
While the industry is still trying to sell based on speed as a primary distinguisher the impact has lessened and will continue to do so as customers go number blind. After all who can count that many 0’s and differentiate a 10Gig connection from 1000Mbps.
A homogenous technology may be good for network management but it presents a different challenge in terms market segmentation for the ISPs and they will have to compete on brand and reputation as well as what services they can offer (TV bundles, Wi-Fi extenders etc.) and perhaps most importantly on price.
Subscribers to UK Plus can read our full report for more data, analysis and details.
BDUK Project Gigabit Update
Project Gigabit Winter Update 2022 to 2023
Since the introduction of the government’s £5bn Project Gigabit subsidy programme to bring gigabit-capable broadband to underserved areas of the UK, DCMS has published quarterly progress updates.
Along with progress made to date (Figure 1), the reports contain timeframes for the procurements, rollouts, Gigabit Voucher scheme uptake, public sector GigaHubs expansions and progression in the devolved nations of similar schemes. The winter 2022-23 update, published on 27 February was the latest progress report. Key points have been outlined below.
Total of 20 live procurements and contracts in place to support the deployment of gigabit-capable broadband to the hardest to reach areas of the UK.
Since November 2022, awarded two contracts in Central and South West Cornwall, totalling £36mn covering up to 19,250 premises; Launched four new procurements in West and East Sussex, Kent, South Wiltshire and Bedfordshire, Northamptonshire and Milton Keynes.
Progress to date means that over £1 billion of public money has now been made available to ISPs.
BDUK has partnered with National Parks England, Openreach and Trenches Law to agree an accord which will enable efficient gigabit-capable rollout while protecting these beautiful landscapes.
The government has continued its Alpha trials it launched in December 2022, which will test the capability of Low Earth Orbit (LEO) satellites to deliver improved digital connectivity to Very Hard to Reach premises. The government has already announced the first four sites and will be announcing further locations in the coming weeks.
Other key telecoms sector news items from the month can be found below.
BT Group News
1 February – EE launched 5G connectivity to the London Underground for the first time (this was followed by Three UK’s 5G London Underground launch on 3 February). 2 February – BT Group announced changes to Board of independent non-executive directors. 2 February – Trading update for the nine months to 31 December 2022 published. 8 February – Openreach started FTTP build in Chipping Sodbury, due to complete in the next 12 – 18 months; FTTP build also launched in Frome with the same completion timeframe. 9 February – EE announced 5G expansion as part of fresh drive to improve rural connectivity. 16 February – BT launched IoT national roaming in a major boost for businesses, keeping smart devices connected wherever they are. 21 February – Openreach announced GEN012/23 Pricing special offer on GEA-FTTC/SOGEA and Gfast/SOGfast; The briefing provided two years’ advance notice of a pricing special offer on FTTC/SOGEA 55/10 & 80/20 & Gfast/SOGfast 160/30 for the period from 1 March 2025 to 31 August 2025. 23 February – New BT Group hub for 2,500 people opened in Bristol. 28 February – Openreach announced NGA2002/23 (GEA-FTTP) 1Gbps+ Pilot Extension, The current published end date of 31 March 2023 will be extended to 31 July 2023
Virgin Media O2 (VMO2) News
3 February – VMO2 reported that it saved customers £3mn a week on EU roaming throughout 2022. 13 February – Every second counts: VMO2 announced free boost to its upload speeds for small business broadband customers; all existing customers will have their upload speeds increased on Voom 600, 800 and Gig1 packages for free. 16 February – VMO2 announced customers and businesses in rural Scotland benefit from mobile upgrades as Virgin Media O2 and Vodafone collaborate to tackle signal not-spots; VMO2 and Vodafone have expanded their 4G networks to two rural Scottish communities, Traquair (Peeblesshire) and Balmacara (Ross-shire), as part of a collaboration between the Scottish Government’s Scottish 4G Infill Programme (S4GI) and UK Government’s Shared Rural Network (SRN). 17 February – More than 20k Southall homes now connected to Virgin Media O2’s gigabit network. 20 February – Possible Trooli sale attracts the interest of Virgin Media O2. 21 February – Virgin Media O2 offered £33 per month saving against Sky’s nearest equivalent service with Bigger + Sports TV and broadband bundle. 23 February – Virgin Media O2 continues integration with multi-million-pound investment in new central London HQ.
CityFibre (CF) News
2 February – CF reportedly began a new restructuring process as a result of the ‘UK’s struggling economy’ that could result in the loss of up to 200 jobs out of their 2,300 strong workforce. 8 February – Areas in Harrogate and Rippon go live with homes in reach of its network in the Bilton, Woodlands, Rossett Green, Pannal, Valley Gardens and New Park areas can sign up to services from CF’s UK launch partner Vodafone, on selected Vodafone Pro Broadband plans, as well as TalkTalk, Giganet, Zen, and many others. 10 February – CF has completed the primary-build of its full fibre network in Inverness. The new network is now ready for service to over 28,000 homes, representing over 90% of the city’s residential properties, as well as businesses, key public sector and community sites. 23 February – CF announced it is investing £20mn in Bracknell to cover 5k premises through a wayleave agreement signed with Silva homes.
Independent Operators (AltNets) News
1 February – Truespeed announced that at the close of 2022 it had passed 60k premises and had 13k connections which is a 21.67% take-up rate; the operator passed 25k premises in the South West and North Somerset throughout the year. 7 February – Quickline announced it has passed around 10k premises in rural locations throughout North Yorkshire, Lincolnshire and North Lincolnshire with its 1 Gbps full fibre network. 7 February – iDNET puts pause on CityFibre based UK broadband packages due to ‘admin issues’, however by 13 February iDNET was offering CF’s services again, so it appeared that the situation had been solved. 7 February – Upp remain optimistic over sale of UK full fibre network. 7 February – Fern Trading provides an update on consolidation of UK ISPs Jurassic Fibre, Swish Fibre, Giganet and AllPoints Fibre. 8 February – Wildanet confirmed that it has partnered with AssetHUB to start offering the former’s infrastructure and services on a ‘fair and neutral wholesale basis’. 14 February – Hyperoptic’s full fibre broadband covers 1.15mn UK homes. 16 February – Zzoomm announced new plans with new prices to help consumers tackle rising costs. The new plans start at sub-£30 and rule out mid-contract price rises, 150 Mbps symmetrical FTTP packages start at £29.95 per month. 17 February – Quickline announced further locations to its 2023 FTTP rollout plans which will cover 55k rural homes and businesses by the end of the year; its FWA network covers 300k premises with its FTTP gigabit-capable network covering around 10k premises. 11 February – Voneus trial gigabit wireless broadband in rural Durham. 22 February – Toob announced its FTTP 1 Gbps network services have gone live in Fareham (Hampshire). 22 February – TalkTalk UK predicts data traffic growth to 2027. 23 February – ZZoomm announced it has passed 100k premises ready for service properties across 29 locations in their latest milestone. 27 February – Netomnia FTTP broadband rollout targets MDUs. 27 February – Quickline commenced FTTP deployments in South Ferriby, near Barton-upon-Humber in North Lincolnshire, and Tealby and North Willingham, near Market Rasen in Lincolnshire. 28 February – F&W Networks extends full fibre network covering 250k UK premises to date.
Other News
2 February – Ofcom UK sets out expectations for 2G and 3G mobile switch-off. 3 February – Ofcom announced that it will be consulting on a pricing offer (Equinox 2) for full-fibre broadband that Openreach intends to introduce from 1 April 2023. 3 February – House of Lords debates rising broadband prices from UK ISPs. 3 February – Wales seeks to ensure new build homes get gigabit broadband. 3 February – Starlink testing next gen LEO satellite broadband dishes. 6 February – Scottish Government provides update on R100 broadband programme. 9 February – Ofcom to review inflation-linked telecoms price rises. 7 February – PM Rushi Sunak announced cabinet reshuffle including ‘re-focusing’ the DCMS into the Department for Science, Innovation and Technology. 13 February – Liberty Global announced the acquisition of a 4.92% stake in Vodafone’s mobile phone operations.
If you are a subscriber to UK Plus, sign-in here to access our UK Plus content where you can view our updated Q1 2023 profiles of the UK’s leading internet service providers, as well as our annual overview of the country’s broadband market.
Please get in touch if you would like to find out more about UK Plus or these particular publications.
[1] For brevity, we will be using the term ‘providers’ to denote both infrastructure owners and retail ISPs, except where specified [2]As a proportion of all broadband lines. [3]There will generally be a lag to the operator announcements for premises passed at the time since it takes us time to properly track and audit any new deployments, unless the operators tell us about them.