Research Round-up September 2022
Analysis of Q2 2022 Global Broadband Tariffs, Project Gigabit updates, ISP news and government updates
Point Topic’s key publication of the month: Global Broadband Tariff Benchmark Report, Q2 2022
Proliferation of global fibre networks sees residential consumers reaping speed and cost rewards, while B2B subscribers see little improvement in bandwidth versus monthly charges.
Summary of key findings
In the twelve months to the close of Q2 2022:
Global residential fixed line broadband monthly charges decreased by 4% copper, cable and fibre.
The average bandwidth increased by 22% year-on-year (y-o-y), due to the increased innovation and proliferation of fibre based networks globally.
Business subscribers continued to struggle with rising monthly charges, with costs increasing by 12% y-o-y and lower average download speeds (426 Mbps) compared to residential averages of 464 Mbps.
Main trends in Q2 2022
Year-on-year charges for residential fibre based products decreased by 5%, downstream averages increased by 17% to reach 549 Mbps; cable based products prices reduced by 4% reduction in prices with speeds rising to 433 Mbps; copper based tariff charges remained static but saw a decrease in speeds from 13 to 11 Mbps.
Gigabit-capable tariffs continue to rise with 456 residential gigabit tariffs available in Q2, compared to 397 in Q4 2021 and 367 in Q2 2021.
Fibre enabled business products monthly charges remained static at $241 PPP y-o-y, average speeds rose by 17% to reach 515 Mbps; cable service charges decreased by 14% but increased bandwidth has slowed to reach an average of 377 Mbps; copper prices have dropped but so have the average downlink speeds with an average cost per Mbps coming in at $13.00 PPP.
Asia-Pacific region retained its dominant bandwidth position with average speeds of 1,355 Mbps, up from 1,146 Mbps in Q4 2021 and 1,135 Mbps y-o-y, followed by North America, Western Europe, and Southeast Asia with the three regions reaching a combined average of around 465 Mbps.
Qatar, Switzerland and Southeast Asian countries still remain at the top of the league by average bandwidth along Italy, France and Bulgaria; these countries all rank in the top ten cheapest for residential broadband in terms of average cost per Mbps being less than $0.10 PPP.
Tables 1 and 2 below provide further information about average regional residential and business tariffs by cable, copper, and fibre technologies with average cost per month in PPP.
BDUK Project Gigabit Updates
On 1 September BDUK awarded local AltNet provider, Wessex Internet, a £6m contract to cover 7,100 premises in the North Dorset area. The contract falls under Project Gigabit’s Dorset Lot 14 procurement area which aims to cover 56,500 premises and which will have deployment projects starting between July and September 2023. Worth noting is that later in the month (27 September), Wessex Internet announced that they had received an undisclosed sum of major equity investment from abrdn’s Core Infrastructure which will support the supplier’s long-term aim of passing 150k premises in the south west region by 2027.
BDUK announced on 29 September that it had awarded local supplier, GoFibre, the Lot 4.01 Teesdale contract. The £6.6m project will cover around 4k in the area and forms part of the larger Lot 4 intervention area covering Durham, South Tyneside and the Tees Valley areas extending into Northumberland. Services are expected to go live in the Teesdale area in 2023.
Telecommunications Security Code of Practice
On 5 September the government published its Draft Policy Paper: Telecommunications Security Code of Practice. The law, which came into effect on 1 October 2022, has positive implications for the end-users, however it does place a considerable amount of interventionist power onto the Government and Ofcom as they can potentially interfere with network design and operations along with supply chain management to ensure that ISPs are adhering to the security regulations. Operators could potentially be served with fines of up to 10% or £100k per day for failing to meet the requirements.
Government response to New build developments consultation: delivering gigabit-capable connections
On 22 September, the government issued its consultation outcome statement on last year’s technical consultation. Despite the new legal frameworks being introduced in the statement when reading the fine print the reforms may not go far enough for some, especially those looking at new build homes in rural areas. The rules coming into effect for developers – at this point those only in England as new regulations are looking to be introduced in the devolved nations in the future – state the following:
All new build homes are installed with the gigabit-ready physical infrastructure necessary for gigabit-capable connections.
A gigabit-capable connection is installed in a new build home subject to a £2,000 cost cap per dwelling, or
Where a gigabit-capable connection is not being installed, the next fastest broadband connection is installed without exceeding the £2,000 cost cap.
However, the rub comes when reviewing the last point as where gigabit-capable technically either through full fibre, coaxial cable, or wireless technically cannot be installed without exceeding the cost cap, the next best technically can be introduced ensuring minimum downlink speeds of 30 Mbps. Where this isn’t possible, then technology meeting the Universal Service Obligation (USO) speeds of 10 Mbps can be introduced.
Other key telecoms sector news items from the month can be found below.
BT Group News
1 September – Warner Bros. Discovery and BT Group completed their transaction to form a 50:50 Joint Venture (JV) that combines the assets of BT Sport and Eurosport UK. 1 September – BT announced new flagship office in Sheffield, joining other key locations in Belfast, Birmingham, Bristol, Cardiff, and Glasgow. 6 September – BT signs multi-million pound contract with ScottishPower, to strengthen the connectivity throughout their network of windfarms and offices. 15 September – BT partners with Atos to create Digital Vision, offering Computer Vision to their combined customer base. The joint proposition will provide customers with a powerful AI-based analytics tool to extract value from their digital images and videos. 15 September – Openreach GEN064/22 WLR Withdrawal in Salisbury and Mildenhall migration update – Reforecasts: Briefing published to inform CPs that Openreach will be requesting CPs with WLR assets in the trial areas (Salisbury and Mildenhall) to reforecast their migration plans or to provide a forecast if none was previously submitted. 20 September – Openreach PIA014/22 briefing to inform all PIA established CPs about new features being made available on the Physical Infrastructure Access (PIA) product and in particular, new features on the PIA Map Tool via the PIA Application Programming Interface (API) which have gone live. 23 September – Openreach NGA2011/22 FTTP New Sites pre-order process update: Briefing published to inform CPs about a scheduled update to the FTTP New Sites (remotely activated/greenfield) pre-order journey. The development enhances the FTTP new sites (remotely activated/greenfield) pre-order journey, providing earlier availability of the ‘P’ flag on eMLC. 27 September – BT Group’s Digital unit opened a bespoke User Research lab at its London headquarters, and a second will be opening in Birmingham later this year. The new labs will help BT Group better understand its customers and internal colleague needs. Alongside this, Digital also announced several experienced design hires, supporting the unit’s strategy to accelerate and modernise BT Group. 28 September – Openreach ETH040/22 New Supply Options for EAD Rugged 1Gb: Briefing published to notify changes to EAD Rugged 1Gb’s contract which will expand new supply options and allow for provision to Licensed Facilities within Data Centres or another CPs PoP. This briefing is relevant to CPs who wish to provision EAD Rugged 1Gb to non-BT Exchange Licensed Facilities. Openreach is expanding options for new supply on EAD Rugged 1Gb to allow for use-cases where a CPs Licensed Facility resides in a Data Centre, or another CP’s Point of Presence (PoP), via changes to the product’s contract. 28 September – Openreach NGA007/22 Connect the Unconnected Special Offer Extension: briefing to inform CPs that Openreach are extending their special offer, Connect the Unconnected, for six months, until 31 March 2023. Connect the Unconnected supports CPs in connecting end customers not taking fixed broadband due to affordability by waiving the connection fee for connections that meet Openreach’s eligibility criteria. Connect the Unconnected was due to expire on 4 October 2022. 28 September – GEN068/22 WLR UK stop sell date and notice to stop new service establishment on WLR: briefing to inform CPs that Openreach will implement WLR UK stop sell and restrict new CPs from establishing to sell WLR from 5 September 2023.
Virgin Media O2 (VMO2) News
2 September – VMO2 confirmed to ISPReview that they have extended their partnership with OFNL for Virgin to supply FTTP services to a further 50k premises over OFNL’s network. 5 September – VMO2 announced WiFi guarantee promising customers minimum download speeds of 20Mbps in every room of their home or £100 credit back. 5 September – Virgin Media O2 announced a promotion for new Virgin Media customers the opportunity to enjoy £200 bill credit when they sign-up to Bigger Movies, Bigger Sports or the Ultimate Volt bundle. 7 September – 55% of UK private and public sector workers say their employer is experiencing a digital skills shortage, according to new national research from Virgin Media O2 Business and Censuswide; Half of organisations are planning to revert to pre-Covid technologies – a move that would make 50% of employees more likely to resign; 36% of employees rarely (if ever) receive digital training, and almost half (48%) say a lack of quality business technology would encourage them to leave their job.
CityFibre (CF) News
5 September – CF has laid 675km of fibre optic cable in Derby as part of its £50m rollout plan. 5 September – CF announced Rugby as its next deployment location and is investing £17m in the project; the rollout is being carried out by Callan Connect and commenced in September and is due to complete in 2024. 7 September – Released ‘ready for service’ homes in Wakefield in the Wakefield West and Wrenthorpe, as well as the Outwood West and Wakefield North Wards areas. In Wakefield, services are available from Vodafone and Yayzi 8 September – £21m town-wide full fibre network has begun in Hartlepool and is being delivered by Granemore Group on behalf of CityFibre with the project due to complete in 2025. 20 September – CF announced it has passed the 2m premises passed milestone with approximatey 1.8m ‘ready for service’, this marks 25% of its 8 million home rollout, passing its second million homes three times faster than the first million. 23 September – CF responds to the publication of the Growth Plan by the UK Government. 23 September – £3m town-wide full fibre network has begun in Whittlesey (Cambridgeshire) and is being delivered by Granemore Group on behalf of CityFibre.
Independent Operators (AltNets) News
1 September – GoFibre have reached final planning stages to cover 1,400 properties in Melrose in the Scottish Borders. 1 September – CommunityFibre launch 5 Gbps broadband for businesses for £335 per month; on 7 September the supplier announced it will be extending its network to the London Borough of Harrow and Islington on 29 September. Grain announced next three rollout locations: Watford (Hertfordshire), Reading (Berkshire) and Northampton (East Midlands). 3 September – New Hull-based provider, Octaplus Supercharged, launched using MS3’s network; Octaplus will provide gigabit-capable broadband, phone and pay TV services. 5 September – Gigaloch’s FTTP network goes live in more areas of Cheshire as part of the Fibre for Ashton Hayes, Horton cum Peel, Mouldsworth & Manley (F4AMM) project. 5 September – Giganet acquired Cuckoo. The acquisition forms part of Giganet’s aim to reach 9m premises across the UK. Cuckoo will become the lead consumer brand for Giganet’s core residential customers, with ‘Giganet’ continuing to be the brand serving its growing enterprise base. 6 September – Hyperoptic launched its Switch Now campaign will give broadband switchers up to nine months’ free full fibre broadband. 8 September – Vorboss announced has it installed over 500 km of fibre optic cables in London since 2020 and is investing over £250 million to build London’s only full-coverage fibre network dedicated to business, with a commitment to cover all commercial buildings in Central London. 8 September – Lightning Fibre announced extension plans into West Sussex and Kent covering 140k premises; the supplier has passed around 60k premises to date. 8 September – KCOM announced its next £100m investment in its next FTTP network extension to cover an additional 50k premises in 14 locations, when complete it will bring its footprint to around 350k premises. 12 September – LitFibre add 5 new coverage locations in West Midlands, Essex and Hertfordshire to its rollout plans. 13 September – brsk secured £178m investment to expand their network rollout in Greater Manchester, Lancashire, West Yorkshire and the West Midlands. 15 September – ZZoomm adds a further 8 towns in Yorkshire and the Midlands with work due to commence this Autumn. 20 September – ITS Technology acquires Nextgenaccess. 21 September – Netomnia published more detailed map of their UK-wide network rollout plans which aims to cover 1m premises by the close of 2023. 29 September – County Broadband published a further 10 villages for its next deployment stage in South Cambridgeshire. 28 September – Gigaclear plans to give more than 2,500 homeowners access to full-fibre broadband in Lydney, in the Forest of Dean, after specialist engineering works successfully drilled under an historic railway line. 29 September – Islington Council has partnered with Hyperoptic with the latter to supply more than 90% of its homes and businesses with a full fibre broadband connection within the next three years. The deployment will cover more than 30k residential premises.
6 September – Sky Broadbandannounced 18-month prize freeze on their Openreach FTTC/P-based products, including some TV bundles.
6 September – The future of low-cost ISP Plusnet is under review by its parent-company BT, as the incumbent focuses its shift to EE as its ‘flagship brand for our consumer customers’.
7 September – EE extend 5G coverage to a further 14 areas.
7 September – New Prime Minister, Liz Truss, commits to ‘faster’ buildout of UK broadband.
16 September – LG successfully tested 6G technology working over the TeraHertz (THz) band that could reach 320 metres.
12 September – TalkTalk Group creates two new divisions in Wholesale B2B and announced a competitive tender for B2B Ethernet supply.
29 September – Ofcom asks ISPs to halt price rises and for those ISPs that do not offer ‘social tariffs’ to introduce them as soon as possible.
If you are a subscriber to UK Plus, sign-in here to access our UK Plus content where you can view our updated Q3 2022 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.