UK incumbent BT says it will this week break through the 10mn broadband barrier, doubling an initial target of 5mn connections by the end of 2006. That target, viewed as ambitious at the time, was set in April 2002 when there were fewer than 150,000 DSL connections. Broadband availability in the UK at that time was 66%; it is now more than 99.8%.

The 10mn wholesale connections are shared between BT Wholesale and Openreach. BT Wholesale supplies services to more than 8.7mn customers (via service providers including BT Retail) whilst Openreach supplies more than 1.3mn lines to customers via local loop unbundlers.

According to BT, broadband has become the fastest growing consumer product in recent years, vastly outpacing the growth in televisions, CD players, video recorders or mobile phones. More than 13mn people in the UK (including cable customers) now use the service, making the UK one of the fastest growing markets in the G8.

“2007 is beginning with broadband firmly established at the heart of the UK economy, helping businesses to compete and enriching people's lives. The UK now has over 200 service providers making it the most competitive broadband market in the world,” states BT chief executive Ben Verwaayen.

Broadband over BT’s network is apparently fast outpacing broadband over cable. Whereas three years ago more than half of all new connections were carried over cable, that percentage had declined to 11% cent for the quarter ending September 2006, meaning 89% cent of new connections use BT’s network.

Recent data from specialist Point Topic ranks the UK, with 9.317mn DSL users at 30 September, 2006, as the world’s sixth largest DSL subscriber market. Globally DSL and cable currently account for the lion’s share of broadband connections. This may be about to change, though. Point Topic reckons that a significant price reduction for FTTX services worldwide took the average cost of broadband over fibre below that of cable in Q3 2006. According to Point Topic, FTTX tariffs went down 12% to US$28.1, 3% lower than the average monthly rental for cable modem services.

“Consumers' preference for DSL and cable modem services remains very strong, but FTTX is certainly catching up, thanks in part to this price cut”, says Vince Chook, an analyst at Point Topic. “If the decline continues, it is very likely that FTTX will overtake cable modem to one of the main players in high-speed broadband services in the future.”
John Williamson