Five million customers waiting for something to buy
June 10, 2014 | Oliver Johnson
A new broadband mapping report reveals a huge opportunity – which no-one is yet taking up. Over five million British homes and businesses are already paying for superfast broadband services. But there is little sign that anybody is yet trying to sell superfast content or applications to this huge market of prosperous consumers.
“There’s been a massive shift in technology in this country in only three years,” says Oliver Johnson, Chief Executive of Point Topic, which has been mapping UK broadband since 2006. “But we don’t yet see anybody taking advantage of it to sell new products to the mass consumer market. It’s as if we had built a new motorway network and cars stayed just the same.”
Early subscribers are enjoying the extra speed, but there is no real “killer app” for superfast broadband at present. Some evidence suggests that people revel in the change of pace when they first get superfast broadband and download masses of data. But when the novelty wears off they revert to using their broadband in much the same way as they did before.
“A lot of people will be saying ‘I told you so’”, says Johnson. “There’s still a strong body of opinion which holds there is no need for such high speeds. But we think the killer apps will emerge, it’s just taking a while.”
Johnson notes some instant ideas for the apps which could make superfast broadband seem a real necessity, not just “nice to have”.
- 4K TV; the next generation if TV beyond high-definition will need 15Mbps downstream for a good experience, at least to start with. If you’ve got a really fast standard broadband connection, that will be sufficient. But most users will need to move up to superfast, particularly if anyone else is going to be on the line at the same time.
- Working from home; being able to access the company network as easily as if you were sitting in the office is one requirement for fully-effective home-working. That requires much better upload speeds than standard broadband provides. This is an app which could bring substantial economic and environmental benefits as well.
- Multi-user HD social media; get together, have a party, see your friends as if you were sharing the same space. Fast upload and multiple fast downloads are what only superfast can provide here.
There are plenty of small scale applications that eat bandwidth and the advent of more machine to machine interaction certainly increases traffic although in small amounts and often running as a background service. But for the general consumer market there’s nothing on the horizon today that will require significantly more bandwidth.
“Many have claimed that once built a whole new ecosystem will emerge to fill the superfast niche and beyond. There’s just no real sign of it yet. People behave broadly the same with a hundred megabits downstream as they did with ten.
“We do have a commercial interest in all this,” Johnson admits. “We’ve got the data which shows where the audience is, so entrepreneurs can reach the new market efficiently. We just wish they’d get on with it,” concludes Johnson.
Point Topic’s analysis of the UK “audience reach” for superfast is available now at Regional Reach of Superfast Broadband in the UK. As the graphic shows, it reveals how superfast coverage is shared between cable and telephone network technologies, where the market is, by region, and what the headroom is for selling superfast broadband to new users as well.
Figure 1: Superfast audience reach by region and technology (Dec 2013 – % of all households)