December 9, 2013 | Oliver Johnson
The latest broadband forecasts from Point Topic have dropped the expected number of broadband lines in the UK by almost 8% at the end of 2016, from just under 26 million lines to 23.88 million.
“There are two primary reasons. The remaining pool of offline households are proving difficult to convert with disposable income for example struggling to recover but the delay in the BDUK deployment has to take a share of the blame,” says Oliver Johnson, CEO at Point Topic.
Although broadband is an increasingly important part of all our lives most of the easy wins have been won. Now the operators are trying to add subscribers from a far more resistant pool of customers and that shows up in the statistics.
Point Topic’s recently released report, Digital Deprivation in the UK, has highlighted the predictors of low broadband adoption and produced analysis of where the impact could be most serious. In all areas of the UK there will be households that are difficult or impossible to convert into broadband subscribers.
Low incomes certainly inhibit adoption but they’ve had more of an effect on the rate of transfer to next generation technologies and superfast bandwidths. There are other factors however affecting take-up however and the digital divide is growing for a number of groups. Those over 60 are still slow to adopt and if you’re in social housing or disabled you are much less likely to have broadband at home.
While broadband growth overall has slowed, the drop in FTTx subscriptions forecast for the end of 2016 is even more marked. Point Topic expects there to be 9.4 million FTTx lines in the UK in 3 years time, almost 12% lower than previously forecast.
The delay in the BDUK process has exacerbated the slow take-up of high bandwidth services. Not only are consumers less willing to increase their broadband budget but the delay in getting the options in front of them has pushed growth, and the attendant benefits, back.
BT have deployed FTTx more rapidly than expected when given the opportunity. There’s certainly scope for more transparency on infrastructure and costs in particular but it has been successive governments displaying a singular lack of purpose that have done much of the damage. Fortunately we don’t expect it to have much long term impact.
By 2020 the UK will have nearly 20 million FTTx subscribers and in excess of 23 million superfast households. The big players will continue to do well as will those niche players who’ve picked their markets carefully.
“Gigabit bandwidths are already available if you really want them and the UK continues to compare well to Europe and much of the world for most metrics. Adoption is strong and while the market continues to need watchful regulation it has been a qualified success so far,” concludes Johnson.
More analysis is available to all in our brief post, UK broadband forecasts to 2020, in the Free Analysis section.