Synopsis

The UK’s telecom market, one of the largest in Europe, is characterised by fierce competition in the mobile and broadband sectors, and by an innovative broadcast sector which has pioneered business models for distributing digital content. As a consequence, mobile and broadband penetration is comfortably ahead of the European average, while digital TV uptake has reached 90% of the population. Consumer prices across the board have fallen steadily, while network capabilities have been greatly expanded following recent investments by British Telecom and Virgin Media in Next Generation Networks.

This report analyses the key aspects of the UK’s telecom market in 2011, presenting statistics on the fixed network services sector and an overview of the key regulatory issues including the status of interconnection, local loop unbundling, and carrier preselection. The report reviews the major fixed network telcos, examines the status of fixed-line voice services following the deregulation of the retail call market sector, and assesses the success and market impact of BT Openreach.

Key developments:

Ofcom prepares for LLU and WLR charges; Ofcom powers to be revised in 2012; regular’s 2010 market report and data to Q2 2011; operator data to end-2011; market developments into 2012.

Companies covered in this report include:

Virgin Media, BT, Kcom, Orange, Cable & Wireless, COLT Telecom, Carphone Warehouse, BSkyB, O2.

Table of Contents

• 1. Synopsis
• 2. Key statistics
• 3. Telecommunications market
  • 3.1 Overview of the UK’s telecom market
• 4. Regulatory environment
  • 4.1 History
    • 4.1.1 Revised NFR
  • 4.2 Regulatory authority
    • 4.2.1 Office of Communications (Ofcom)
    • 4.2.2 Ofcom’s strategic review
    • 4.2.3 Digital Economy Act 2010
  • 4.3 BT’s functional separation
    • 4.3.1 Openreach
  • 4.4 Telecom sector liberalisation in the UK
    • 4.4.1 Privatisation of British Telecom
    • 4.4.2 Interconnect
    • 4.4.3 Access
    • 4.4.4 Number Portability (NP)
    • 4.4.5 Carrier PreSelection (CPS)
    • 4.4.6 Wholesale Line Rental (WLR)
• 5. Major fixed network operators in the UK
  • 5.1 New regulations
  • 5.2 British Telecom
    • 5.2.1 Company restructure
  • 5.3 KCom
  • 5.4 Cable & Wireless (C&W)
  • 5.5 Virgin Media
  • 5.6 COLT Telecom
  • 5.7 Carphone Warehouse
  • 5.8 Orange
  • 5.9 BSkyB
• 6. Telecommunications infrastructure
  • 6.1 National telecom network
  • 6.2 Next Generation Networks
    • 6.2.1 BT’s 21CN
  • 6.3 International
    • 6.3.1 Submarine cable networks
    • 6.3.2 Satellite networks
• 7. Related reports

• Table 1 – Country statistics – 2011 (e)
• Table 2 – Telecom revenue and investment statistics – 2011 (e)
• Table 3 – Telephone network statistics – 2011
• Table 4 – Internet user statistics – June 2011
• Table 5 – Broadband statistics – 2011 (e)
• Table 6 – Mobile statistics – 2011
• Table 7 – National telecommunications authority
• Table 8 – Telecom sector investment – 2007 - 2012
• Table 9 – Share of fixed-line and mobile connections by operator – 2006 - 2009
• Table 10 – Communications retail revenue by sector – 2003 - 2012
• Table 11 – Retail voice and data revenue – 2003 - 2012
• Table 12 – Household spend on telecoms services – 2005 - 2010
• Table 13 – Communications revenue by sector – 2003 - 2012
• Table 14 – Communications wholesale and retail revenue – 2005 – 2012
• Table 15 – Call volumes, fixed-line and mobile in minutes – 2003 - 2012
• Table 16 – Telecom retail revenue by sector: fixed, mobile – 2002 - 2012
• Table 17 – Telecom connections: fixed, mobile, broadband and Internet – 2002 - 2010
• Table 18 – Fixed-voice revenue by call type – 2002 - 2010
• Table 19 – Household penetration by telecom technology – 2003 - 2004; 2006 - 2011
• Table 20 – Revised LLU, shared access prices – 2009 - 2012
• Table 21 – Proposed wholesale charges by sector – 2008 - 2011
• Table 22 – Proportion of unbundled exchanges and connections – 2005 - 2010
• Table 23 – BT fully unbundled lines – 2004 - 2011
• Table 24 – Lines with CPS – 2004 - 2012
• Table 25 – WLR lines – 2004 - 2012
• Table 26 – Market share of fixed-voice calls by volume – 2006 - 2009
• Table 27 – Fixed-voice traffic by type in minutes – 2002 - 2012
• Table 28 – Fixed telecom lines by type – 2005 - 2010
• Table 29 – Fixed telecom lines by operator – 2005 - 2010
• Table 30 – Fixed-voice and data retail revenue – 2002 - 2009
• Table 31 – BT share of residential call types by traffic volumes – 2002 - 2011
• Table 32 – BT retail fixed voice calls – 2008 - 2011
• Table 33 – BT fixed lines – 2008 - 2011
• Table 34 – BT financial data – 2006 - 2011
• Table 35 – BT revenue by operating division – 2007 - 2011
• Table 36 – BT retail revenue by sector – 2007 - 2011
• Table 37 – KCom revenue – 1999 - 2010
• Table 38 – Cable & Wireless financial data – 2009 - 2011
• Table 39 – Cable & Wireless subscribers by sector – 2007 - 2009
• Table 40 – Virgin Media revenue – 2003 - 2011
• Table 41 – Virgin Media revenue by sector – 2006 - 2011
• Table 42 – Virgin Media subscribers by sector – 2007 - 2011
• Table 43 – COLT financial data – 2006 - 2011
• Table 44 – Carphone Warehouse Group revenue, profit – 2007 - 2011
• Table 45 – Orange broadband subscribers – 2004 - 2011
• Table 46 – BSkyB voice customers – 2006 - 2011
• Table 47 – Fixed lines in service and teledensity – 1999 - 2012
• Table 48 – Forecast NGA coverage – 2009 - 2012

• Chart 1 – Communications retail revenue by sector – 2003 – 2012
• Chart 2 – Retail voice and data revenue – 2003 – 2012
• Chart 3 – Communications revenue by sector – 2003 – 2012
• Chart 4 – Communications wholesale and retail revenue – 2003 – 2012
• Chart 5 – Call volumes, fixed-line and mobile in minutes – 2003 – 2012
• Chart 6 – Fixed-voice and data retail revenue – 2002 – 2009
• Chart 7 – BT financial data – 2006 - 2011
• Chart 8 – Virgin Media revenue by sector – 2006 – 2011
• Chart 9 – Virgin Media subscribers by sector – 2007 – 2011
• Chart 10 – COLT financial data – 2006 - 2011

• Exhibit 1 – EU – The New Regulatory Framework (NRF)
• Exhibit 2 – Principal submarine cables from the UK