Recession threatens broadband deployment

 

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Posted on 27 Oct 2008 at 15:44

The rate of UK broadband deployment is dropping off in the face of a "real recession", new research reveals.

According to the latest data from Point Topic, the number of new broadband lines added in the July to September quarter was a clear 20 per cent below earlier expectations.

In April 2008 the analyst firm forecast that Britain would add another 800,000 broadband lines in the second half of 2008. This was supported by the actual numbers for June 2008 which were slightly ahead of the forecast.

"To keep on track Britain needed to add 390,000 broadband lines in the July to September quarter. We estimate that the actual number was only 313,000 - 20% down on the target," said Tim Johnson, chief analyst at Point Topic.

Local loop unbundling - where ISPs such as Carphone Warehouse and Sky install their own equipment in BT's telephone exchanges - was found to be the main driver of continuing growth in broadband, adding 323,000 lines in the quarter.

Point Topic estimates that Virgin Media may have added another 60,000 cable modem customers while BT and smaller players actually suffered a net loss of around 70,000 customers.

"We are now forecasting that only 620,000 broadband lines will be added in the second half of 2008," added Johnson.

"The forecast for 2009 as a whole is 1.1 million; 200,000 down on the earlier forecast. By the end of 2009 there should be about 18.4 million broadband lines in Britain, 300,000 short of what was expected six months ago."

He predicts that this means that fewer people will switch from dial-up lines to broadband, and about 240,000 more homes will be without any
kind of internet access by the end of 2009.

Author: Robert Jaques