BT will this week break through the ten million broadband barrier, smashing its initial target of five million connections by the end of 2006. That target, viewed as highly ambitious at the time, was set in April 2002 when there were fewer than 150,000 DSL connections. Broadband availability at that time was 66 per cent whereas it is now more than 99.8 per cent.
The ten million wholesale connections are shared between BT Wholesale and Openreach. BT Wholesale supplies services to more than 8.7 million customers (via service providers including BT Retail) whilst Openreach supplies more than 1.3 million lines to customers via local loop unbundlers. Every one of these ten million connections brings revenues 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 13 million people in the UK (including cable customers) now use the service, making the UK one of the fastest growing markets in the G8. The success of Broadband Britain has resulted in the UK leading Europe in online shopping and ecommerce – a trend that has been evident over the festive season.
Ben Verwaayen, Chief Executive of BT Group, said: “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. That means fantastic choice and value for consumers, and a constant stream of new and innovative applications.”
Broadband over BT’s network is 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 just 11 per cent for the quarter ending September 2006 meaning 89 per cent of new connections use BT’s network.
In an intensely competitive environment BT Retail’s share of the total broadband market (including cable) has remained steady at around 24 per cent. This figure reflects its share of the total market at the end of September 2006 and is exactly the same as it was one year previously. BT Retail now has more than three million broadband customers.
Going forward, broadband speeds are set to increase with the roll out of BT’s 21st Century Network. This will see the speed of broadband increase across the UK and not just in the city centres where local loop unbundlers are focusing their investment. Speeds of up to 24Mb/s will be increasingly available across the UK from January 2008 although actual speeds will depend on a variety of factors including distance from the exchange.