The latest research from Point Topic shows that there has been a big slowdown in broadband contracts sold in the last quarter of last year in fact sales more than halved in the period, versus the same period the year before.
Point Topic blame the sharp fall – with only about 200,000 new broadband connections in the period to the economic slowdown. This is echoed by comments from the service providers themselves, who cite the huge reduction in home movers as a key reason for a reduction in sales of broadband contracts.
As a result Point Topic estimate that the number of broadband lines in the UK increased from 17.04 million in the third quarter of 2008 to 17.23 million by the end of the last quarter 2008.
When you think that there are only approximately 25m homes in the UK this does represent very high penetration and indeed part of the slowdown will be simply as a result of the maturity of the market.
Point Topic commented:
“Within that total it looks as if BT and its resellers are suffering most. The ISPs using local loop unbundling to provide their broadband services to Carphone Warehouse, Sky, Tiscali and Orange did relatively well, adding nearly 430,000 lines between them. Point Topic estimates that Virgin Media may have added about 60,000 cable modem customers as well.”
This makes absolute sense as the BT resellers have very little to offer the consumer relative to the LLU providers, whose economics allow them to offer far more appealing price propositions. So what we are seeing is a shift in share towards the big LLU players. Indeed indications are that Sky and O2 were the biggest selling broadband services over the time period.
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