United Kingdom - Market Intelligence Report
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Market Intelligence Reports provide an invaluable mix of vital market data and background information, including telecoms regulation. The overall turnover of the United Kingdom's telecommunications services industry (which excludes radio and broadcasting, and telecommunications equipment) grew by 1.5% to UK£47,100 million in 2006. Over UK£38,600 million was attributable to end-user (retail) spending - the remainder being wholesale services. Growth was concentrated in mobile services, which grew by UK£900 million, offsetting the decline in fixed voice market revenues of UK£400 million. Despite this positive growth, there was some degree of industry consolidation during 2005 and into 2006, with the major deals seeing cable TV operators ntl and Telewest combining in March 2006 before going on to acquire mobile virtual network operator Virgin Mobile later in the year and rebrand the whole operation as Virgin Media, satellite-based pay-TV operator BSkyB acquiring fixed-line broadband operator Easynet, Cable & Wireless acquiring corporate services provider Energis, and Carphone Warehouse acquiring Tele2 UK and Ireland as well as One.Tel. Carphone Warehouse later went on to acquire AOL Time Warner Inc's Internet access business in the UK. AOL was one of the largest ISPs in the UK, with approximately 2.1 million ISP customers, comprising 1.5 million broadband customers and 600,000 dial-up customers. The acquisition of the Access business gave Carphone Warehouse an enlarged broadband customer base of approximately two million customers, making it the third largest broadband provider in the UK. According to figures from regulator Ofcom, incumbent operator BT saw its share of the UK fixed voice market fall to under 50% for the first time in the year ended December 31, 2006. BT's share of fixed voice call volumes stood at 48% at that time, down from 52% the previous year. Its share of the access line (exchange lines installed) market continues to fall, to 64% from 66% in 2005. Major competitors are carrier pre-selection operators, though this trend reversed in the first half of 2007 as operators migrate to Local Loop Unbundled lines services, and cable operator Virgin Media. The UK cellular sector has passed the saturation point, with an estimated 71.7 million 'active' subscribers as of June 2007, representing a penetration rate of 119.5%. There are currently five licensed network operators - Vodafone, O2, T-Mobile, Orange, and Hutchison Whampoa-owned 3. As the new entrant, 3 continues to have the smallest share of the UK's wireless market and its reported subscriber base of just 3.4 million as of December 2005, rising to just over four million by June 2007, demonstrates slow take-up of its expensive 3G-only services. The other four operators offer 2G/2.5G services as well as their new 3G offerings. There are also several popular MVNO brands active in the UK, including easyMobile, Tesco Mobile, and Virgin Mobile. The UK's broadband services market continues to grow strongly, with nearly four million new subscribers signed up in 2005 and 3.1 million in 2006. Over 50% of UK households took broadband services (including cable) as of June 2007, at which time there were 14.4 million broadband customers. BT's competitors include Virgin Media, Carphone Warehouse's Talk Talk/AOL, Wanadoo (Orange Home), and Tiscali.
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