Number of UK broadband users nearing saturation point?
The Register is reporting that BT Retail is expected to report a slow down in the number of sign-ups when it publishes its latest figures. Data from Point-Topic.com shows that broadband growth in the UK was well down on previous quarters, with just over half a million new connections in the second quarter of 2007 versus some 891,803 in the first quarter. This drop seems to be common across Western Europe and may just be an annual thing during the second quarter of the year as Q2 2006 had a similar dip in the rate of new connections.
What should be obvious to people following the broadband market is that as the number of connections increases, a point will be reached where those willing to sign-up will have signed up and the growth will slow. It is perhaps with this background we are seeing value added services such as BT Vision and Tiscali TV appearing. Bundles are also a good way of making it harder for consumers to churn away and head to competitors, as once in a bundle people are generally less likely to move all of their services elsewhere.
We can but hope that as the new sign-up market dwindles that providers may begin to focus on quality of customer service rather than chasing ever cheaper deals to attract dial-up customers. Looking further into the future, many will hope that as the market for new connections dries up, things like fibre will start to be pushed out from the telephone exchanges to support higher broadband speeds. One advantage of shorter lines for running variants of DSL over is that the effects of noise should be lessened, making lines more reliable and thus more attractive for video and VoIP services.