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UK comms industry growth stopped in 2008 - and still hasn't recovered: Report

Posted By Martyn Warwick , 10 December 2009 | 0 Comments | (0)
Tags: telcos Broadband Internet Finance Mergers & Acquisitions mobile

This year's Communications Market Report 2009, from the UK telecoms and media regulator Ofcom, confirms to the wider world what we in the industry already knew all to well - that the growth of the sector ground to a halt completely in late 2008 and has not yet recovered. Martyn Warwick reports.

Despite the remarkable success of the iPhone and subsequent upswing in the popularity of other smartphones, the UK mobile market is supersaturated (the penetration rate is now slightly in excess of 130 per cent) and so the relative growth of one operator comes at the direct and quantifiable cost - in terms of ARPU, sales, margins and churning subscribers - of others.

The British mobile market is one of the most competitive and cut-throat in the world and as every man, woman, child and dog now seems to have at least one mobile device each, the operators are having either to do everything they can to tempt their customers to use their handsets and premium applications and services more and more (via bundled service packages etc) or get involved in an unending price war that, in end will make them all losers as already thin margins are top -sliced again and again.

Over on the fixed-line side of the fence much store and corporate hope is placed in the continuing roll-out of broadband networks and services. However, and despite the government's much-vaunted "Broadband Britain" initiative, access to decent high-speed Internet access is still the privilege of town and city dwellers whilst many of our rural communities (sometimes, indeed far too often, sited no more than 10 miles of so from a major conurbation) remain all but cut-off from the digital world by pitifully slow speeds - or even have no access at all. In an island as small and heavily-populated as Britain this is, quite simply, a disgrace.

Some cable companies continue to deploy fibre, but they are never going to dig up the whole of the country - it would be economically unviable as well as geographically impossible.


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