UK broadband subscriptions rose to 17.4 million last year, new figures reveal, but a slowdown in take-up in the second half of the year suggests that 2009 will be tough for operators.
According to a study conducted by Point Topic, broadband take-up slumped during the second half when just 675,000 new subscriptions were taken out. This compares with one million for the first six months. The sharp decline after June meant that the broadband market grew by 10.6 per cent over the course of the year – almost half of 2007’s expansion of 19.9 per cent.
The second-half figures did, however, reveal some cause for optimism, thanks to stronger take-up for cable broadband. This was driven by the launch of Virgin Media’s 50Mb service, which brought faster broadband within the reach of the mass market.
Tim Johnson, chief analyst at Point Topic, said that the report's findings represent a mixed outlook for the state of the UK broadband market.
He said: “So by March 2009 the broadband scene in Britain was very different from a year earlier. On the one hand the market was seizing up. Structural change had ground to a halt; market growth had slowed sharply.
“On the other, having started late, the UK was making rapid advances towards rolling out next generation broadband and delivering super-fast speeds to a high proportion of the country.”
However, Mr Johnson believes that these shoots of improvement in the sector will not be felt until 2010 and that this year will prove tough for networks.
“2009 will see slower growth in broadband numbers as the recession bites, but we expect the market to bounce back in 2010. Better mobile coverage and bandwidth upgrades should help mitigate some of the current difficulties and the long-term prospects for “Digital Britain” look good,” he commented.
O2 was among the best-performing UK internet service providers, adding 71,000 fixed broadband lines over the year. This brought its total number of subscribers up to 270,000 – equating to a UK market share of around 1.5 per cent. Meanwhile, Sky built on the success of previous years to boost its subscriber numbers by 727,000 and bring its total number of broadband customers to almost 2 million.