Broadband Britain Recovering From Poor Q2

Point Topic said that in its earlier report for H1 2006 it found that despite the tempting ‘free’ broadband services now offered by several ISPs, broadband take up was slow in the first half of the year.

It put this down to, in the main, a lack of technical availability, with delays in Local-Loop-Unbundling (LLU)causing problems for thousands of customers wanting a free service.

The second half of 2006 has not started any better than the first, although the broadband information company says that there are signs of a gradual recovery.

LLU made good progress in Q3 2006, up from 580,000 to 850,000, representing a quarterly net addition of 270,000 unbundled lines, compared to 220,000 in Q2 2006.

Point Topic says that, together with Kingston Communication’s contingent of DSL lines in and around the city of Hull, it estimates that the number of DSL lines in the UK now totals 9.4 million, up from 8.7 million in Q2 2006.

All in all, the UK’s DSL base grew by 8% this quarter, compared to 6.5% last quarter.

Point Topic released research covering Q2 2006, which showed that it had the lowest growth rate in broadband history (see Lowest Quarterly Growth Rate In Broadband History).

BT’s DSL figures for Q3 2006 show that the progress in LLU has had a considerable effect on BT’s wholesale business, with LLU slowly but surely eroding BT’s dominance in some areas of the UK.

London and the UK are the two regions in which BT’s share of DSL lines dropped by 1.7% and 3.6% in Q3 2006.

At 17%, the South East has the highest share of BT DSL lines, followed by London, the East of England and the North West, with about 10%-11%.

Northern Ireland had the highest DSL growth rate between Q4 2005 and Q3 2006, followed by Wales and Scotland. Point Topic says that starting out with low or average subscriber numbers in Q4 2005, these three regions have clearly made an effort to close the gap.

However, the North East, West Midlands and North West performed weakly, with Point Topic expecting them to grow faster than the 19.6%-22.8% take-up which was recorded.

The only region which scored lower than the North West was London, a region in which BT is losing its market share to LLU ISPs.

The South East has seen impressive growth of 21.4% since Q4 2005, although it had the second lowest growth rate, of 4.5% in this quarter, as saturation and the LLU effect beginning to take their toll on BT DSL lines in the region.

As was to be expected, percentage growth was higher in the areas which had seen very little broadband penetration earlier or were DSL enabled much later than other BT areas.

Parts of Wales, Scotland and Northern Ireland as a whole top the UK broadband growth ranking for this quarter.

The top three areas in growth terms were Eilean Silar (which also has this year’s highest growth rate), Powys and Gwynedd in Wales. The two Welsh areas grew by 42% and 40% since Q4 2005, well above the UK average of 20%.

Point Topic also published research which forecast that 64% of UK households will be on broadband by 2008 (see 64% Of UK Households On Broadband By 2008).