TalkTalk saw 7 out of 10 new customers take a fibre based product
The headline is that in Q1 of the financial year 2020, i.e. April/May/June 2019 TalkTalk saw 70% of its new customers sign up to one its fibre based products and in June this peaked at 75%. The date then that TalkTalk stop selling ADSL2+ services looks like it may be rapidly approaching especially given that they are finding the fibre based services are more reliable even though the vast majority are partial fibre (VDSL2 - though in York there will be some full fibre via UFO/Fibre Nation) and in financial terms people are churning less once on the fibre products and represent a higher ARPU.
There is no figure for the number of net adds in the results but we are told that in the quarter some 118,000 net adds for the fibre products took place (the majority clearly being existing customers upgrading from ADSL2+). The previous quarter saw the customer base grow by just 2,000 and with no mention this quarter this suggests that it was a smaller growth or may even have shrunk slightly.
Other than saying they are continuing to look for an investor in their Fibre Nation roll-out which should go to places such as Harrogate with a full fibre roll-out there is not much more in the release unless you have shares in TalkTalk.
If the customer base is not growing when TalkTalk is often the cheapest partial fibre provider (pricing varies but has been as low as £19.95/m for the FTTC/VDSL2 service) this suggests other factors than price are involved. One problem facing all the broadband providers is that as rules around fairness improve for the consumer that it is becoming harder to get people to switch and the last year or so may have been made more challenging as people used to the up to 38 Mbps adverts saw the speed figures in the adverts get lower and the public may have voted to stay with the devil they know worried that their speeds may drop.
The path to financial success is going to be a tough one in the next decade, the next wave of churn is just starting as full fibre services roll-out.
As usual we can share what we are detecting in terms of products and for TalkTalk 37% are still on ADSL2+, the FTTC 40/10 product is the largest share at 48% and the 80/20 VDSL2 service commands a 14% with just under 1% split between the FTTP and G.fast platforms.