Research Round-up January 2024
- Veronica Speiser
- Feb 5, 2024
- 4 min read
Broadband affordability in the UK in January 2024: A Postcode Lottery; Global broadband subscriber growth rebounds as fibre increases its share further in Q3 2023; BDUK Project Gigabit updates; UK telecoms sector news; government and Ofcom updates
Key publication of the month:
Broadband affordability in the UK – January 2024
Entry-level cost of broadband and what consumers get for it
As of January 2024, the lowest available monthly broadband subscription at the postcode level varied from £13.99 (a fixed-wireless (FWA) service) to £41.25 (an FTTP service). The £13.99 monthly subscription was advertised by Kijoma, although we were not able to establish whether the ISP is still taking new customers. This price was marketed for an FWA service with 40/2 Mbps (down/up) speeds and 20GB monthly data cap. Vispa’s FTTP package priced at £41.25 included 100M/20 Mbps speeds and no usage limits.
Below is an example of monthly subscription distribution at the postcode level in and around Cardiff. In this area, the cheapest broadband available to consumers in one lucky postcode was a 4th Utility FTTP plan priced at £15.00 a month and offering 50/50Mbps speeds. In the majority of postcodes (38%), however, the cheapest broadband was offered by TalkTalk – it was an FTTC plan with 38/9Mbps speeds at an average price of £25.38 a month (£14.50 a month for six months, then £29.00 a month for 18 months with a 24-month contract).
UK-wide detailed pricing data at the postcode level is available to our customers, and it can be updated monthly upon request. In this analysis, we are focusing on the pricing at the small area level (LSOAs / DZs / SDZs).
At the small area level across the UK, entry-level broadband subscriptions varied from £13.99 to £29.99 a month (Table 1). At the postcode level, the cheapest option was a £13.99 FWA plan advertised by Kijoma. Another FWA provider VFast followed with a £14.50 plan offering 24/1Mbps speeds and 5GB usage cap. It came with a hefty one-off charge of £199.00. At the other end of the spectrum, in some areas the cheapest broadband was supplied by BT at £29.99 a month. It was an ADSL service with a £31.99 activation charge, and it came out as the cheapest option in 4 small areas.
The cheapest broadband based on the FTTP technology was available in 428 small areas from 4th Utility. With 50/50 Mbps speeds and a £15 monthly subscription, it came third in lowest price table, offering the best value for money in terms of bandwidth and price ratio.
Read the complete article in our free analysis here.
Building Digital UK (BDUK)
As of January 2022, BDUK has been asking suppliers delivering gigabit-capable infrastructure to submit national data returns on a 4-monthly basis (January, May, and September) to provide detailed build plans at premises level. The purpose of this National Rolling Open Market Review (NR OMR) is to ensure that it has the most up-to-date information about suppliers’ existing and planned build - in particular, commercial build - over the next three-year period with supplier submissions being used to inform eligibility across Project Gigabit.
This Request for Information (RFI) will allow BDUK to identify potential IAs for government subsidy. This NR OMR RFI is concerned with the following areas as shown below (and on the map) and will close on 24 February 2024:
Central East England
Central West England
North East England
North West England
Northern Ireland
South East England
South West England
Wales
BDUK state that although data and evidence is being collected for all areas above, the assessed outcome for the January 2024 NR OMR will be limited to England and Wales only; due to ongoing OMR/PR activity within Scotland and Northern Ireland.
Scotland Announces Evaluation of its Publicly-Funded R100 Programme
On 16 January, the Scottish Government Office of the Chief Economic Advisor (OCEA) announced that it will commission an evaluation exploring the performance of the Reaching 100% (R100) programme against Investment Objectives. It is essential that we are able to assess Value for Money of this programme in terms of understanding the social, economic, environmental and other benefits to households, businesses and communities of improvements in broadband connectivity and speed.
Funding for R100 includes £592.2m of Scottish Government investment, £49.4m from the UK Government (BDUK) and £54.1m from BT who has been awarded the LOTS 1,2, and 3 contracts aiming to cover around 114,900 premises by 2027/28.
The UK Government revealed in December that Scotland’s share of the £5bn Project Gigabit broadband rollout scheme will be an “estimated” £450m, although market engagement work is ongoing (i.e. getting feedback from suppliers) and has yet to reach the procurement stage.
Despite contract delays due to a legal challenge by Gigaclear back in 2020, Openreach have covered around 36,100 premises increasing to 48k if the Openreach ‘overspill’ - the extra premises that Openreach picks up while working within the same areas on the R100 build, along with successful Gigabit Voucher premises.
The evaluation will take place until 12 February with its findings due to be published later this year.
BDUK Gigabit Broadband Voucher Scheme
BDUK surprised the telecoms community in January by its rethinking of Gigabit Broadband Voucher Eligibility criteria.
To recap, BDUK’s website clearly outlines its parameters stating that the primary eligibility requirements are for homes or businesses to reside in rural areas where existing broadband speeds are “less than 100Mbps” and a “gigabit capable network isn’t likely to be built to that area commercially in the near future” (i.e. no commercial or publicly funded gigabit network exists or is planned within the next 3 years).
So, what is BDUK saying now? Areas that were previously covered by ‘Superfast’ programmes such as, Connecting Devon and Somerset, and have received minimum speeds of around 35 Mbps – either through FWA or FTTC technology are not eligible for the Gigabit Voucher Scheme as they have met the criteria of having suitable Internet connectivity that was sponsored by the Government.
Due to complaints put forth by some suppliers, on 27 January BDUK noted that it has agreed to review the questions raised over subsidy longevity between schemes and acknowledged that they could have done a better job of communicating all of this clearly with their suppliers.
Key January telecoms sector news
BT Group News
2 January – More data used than ever before, as the UK’s most comprehensive broadband data shows a 9% jump compared to 2022.
Broadband use across the UK increased by 9% last year, according to Openreach.
It’s the most comprehensive data available from Openreach, which builds and maintains the fibre network used by customers from hundreds of broadband providers, including BT, Sky, TalkTalk, Vodafone, and Zen.
According to Openreach’s annual update, broadband traffic across the UK increased by around 9% during 2023 to 94,722 Petabytes (PB) of data.
A closer examination of the numbers shows that peaks tend to be focused on specific online events such as Amazon Prime’s Premier League coverage, and the release of downloads for popular gaming titles including Call of Duty.
There was a real surge in broadband use towards the end of the year, with December being the busiest month of 2023 for broadband traffic, and Boxing Day the busiest day.
8 January – Etc., the startup and digital incubation arm at BT Group, announced that it will power up its first EV charging unit built from a street cabinet traditionally used to store broadband and phone cabling. The announcement marks the first step in the rollout of new technical trials, exploring the potential to upgrade up to 60k cabinets to help meet government sustainability targets and decarbonise the transport system in the UK.
16 January – Broadband ISP and mobile operator EE (BT) has today announced that they’ve completed – six months ahead of schedule – the first phase of their roll-out under the £1bn industry-led Shared Rural Network (SRN) project, which aims to extend geographic 4G (mobile broadband) coverage (aggregate) to 95% of the UK by the end of 2025.
29 January – BT Group announced plans to recruit more than 500 apprentices and graduates for its September 2024 intake.
The company will recruit talent into the company across areas as diverse as software engineering, customer service, applied research, data analytics and cyber-security to support the UK’s fast-growing digital sectors.
The new roles are spread across a number of state-of-the-art offices which form part of BT Group’s Better Workplace Programme - the largest workplace improvement programme and consolidation scheme of its type ever undertaken in the UK.
Locations include Belfast, Birmingham, Bristol, Cardiff, Darlington, Ipswich, Leeds, London, Manchester, Sheffield and Warrington.
31 January – Openreach announced half of all Welsh properties can now access ultrafast full fibre broadband over its network.
Wales’ largest network provider has also revealed the top 20 locations across the country with the best ultrafast broadband coverage – and a Flintshire town has come out on top. More than 816k homes and businesses can now access ultrafast, full fibre broadband via a range of retail providers using the company’s network. And, while cities and urban parts of south Wales are often perceived to have the best broadband, small towns and villages in north Wales dominate Openreach’s list of hotspots with the highest levels of full fibre.
Virgin Media O2 (VMO2) News
10 January – Comex 2000 (VMO’s preferred engineering contracting firm) announced that it has expanded its operations into Scotland to support Virgin’s network rollout. Comex 2000 has historically focused on VMO2’s West Midlands deployments, but will now aim to further its rollout in Scotland. Worth noting is that Comex 2000 also has contracts with CityFibre, Community Fibre, Gigaclear, and Zayo.
16 January – VMO2 and nexfibre announced that 12k additional premises in Heysham and Lancaster have been covered with the former’s 1,130 Mbps full fibre network.
18 January – VMO2 started notifying Upp’s consumer base that, “Upp’s customers will be given the option to pre-order Virgin Media broadband services through a bespoke link contained in their direct communication. All customers will receive a free right to cancel due to the terms and conditions amendments being made.
We will be writing to Upp customers again later this year to provide further information on Virgin Media installation dates, if this option is selected, or notifying them that we will end their Upp service. We’re committed to supporting all Upp customers as this necessary simplification of products takes place and will clearly outline the options available so customers can make an informed choice that works best for them.”
Upp was acquired in September 2023, from the investment firm LetterOne by network builder nexfibre (Virgin Media) for an undisclosed sum.
29 January – VMO2 announced that it is creating around 200 apprenticeship, graduate, and intern positions in 2024, in a wide range of positions across the UK including in London, Reading and Manchester. All roles are offered on a permanent basis providing job security, with a starting salaries of at least £22,500 and up to £35,000.
31 January – Virgin Media O2 and Tesco Mobile have signed a 10-year renewal of their 50:50 joint venture. Twenty years after it was first formed, Tesco Mobile has grown to be the UK’s largest mobile virtual network operator (MVNO), with more than 5.5 million customers.
CityFibre (CF) News
11 & 30 January – CF announced that its primary builds in Slough and Bury St Edmunds are now complete.
26 January – CF published its trading update for the year ended December 2023. To summarise its key points:
CityFibre added 1m Ready for Service (RFS) homes in 2023, taking total RFS premises to over 3.2m.
Doubled take-up on the network reaching total of 337k live customer connections.
Secured four new contracts worth £387m under UK Government’s “Project Gigabit”.
Generated £100m in revenues and is on track to deliver EBITDA breakeven in H1 2024.
The supplier also stated that, on the CityFibre footprint, large ISPs are typically selling at two-to-three times the rate they do over BT Openreach’s fibre network. CityFibre is also consistently gaining a 40-50% share of the homes switching broadband provider within its footprint.”
30 January – Delays as CityFibre suspends more UK FTTP broadband builds.
Independent Operators (AltNets) News
4 January – Global Connectivity a shareholder in Voneus through its investment in Rural Broadband Holdings Solutions Limited ("RBSHL"), announced a further combined capital investment of £25m was made into Voneus by its shareholders and lenders.
This investment in Voneus increases RBSHL's stake to 36% from 32%. Global Connectivity plc owns a 15% stake in RBSHL's common equity.
5 January – Truespeed hit with fines and charges totalling more than £34k after pleading guilty to five offences in Somerset.
Somerset Council prosecuted the firm following works carried out in Frome and Street. Truespeed admitted failing to install proper traffic management and guarding broken and excavated road surfaces to ensure the safety of pedestrians on a number of occasions, in breach of the New Roads and Street Works Act 1991.
19 January – ISP and network builder Airband, which originally aimed to cover 600k premises in rural areas via a mix of their wireless (FWA) FTTP networks by the end of 2025, has revealed that it’s going through a “period of restructuring” after claims of redundancies and build pauses surfaced.
23 January – Software as a service provider Strategic Imperatives, which among other things operates the Fibre Café connectivity aggregation platform to help UK alternative broadband networks to grow, has today announced a deal to merge with technology firm X3T in order to harness its wholesale networks solution.
23 January – Connect Fibre (Fibre Assets) adds 150 Mbps social broadband tariff option for £25 per month.
24 January – Wind farm grant extends B4RN’s Barrasford FTTP broadband build.
26 January – Fern Trading marked a key stage of its consolidation process as consumer broadband subscribers have started to be moved onto Cuckoo’s network from Giganet, Jurassic Fibre, and Swish Fibre.
Other News
4 January – Starlink launch first 6 LEO broadband satellites for mobile service.
30 January – Sky UK notified staff that as many as 1,000 jobs could be cut this year as the company increasingly shifts its focus toward its IPTV solutions – Sky Glass and Sky Stream. Satellite TV installers are known to be one of the impacted groups.
25 January – Ofcom published its Complaints about broadband, landline, mobile and pay-TV services Q3 2023 report, with Virgin Media being the most complained about broadband, landline and pay-TV provider, seeing significant rises across all these areas from the previous quarter. Customers’ complaints were mainly driven by how their complaints were being handled.
30 January – Thinkbroadband reported that 62% of the UK is now covered by full fibre.
31 January – Local London Association published its strategy launched for tackling digital infrastructure deficits especially for those 150k+ premises in south and east London that do not have access to gigabit-capable internet connections.
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