April 16, 2014
Ofcom are to look into if BT need to reduce the price of their wholesale superfast fibre optic broadband prices after claims that they were charging rivals too much for use of their network.
In May last year TalkTalk complained to Ofcom that BT were abusing their dominant position when setting prices for wholesale fibre optic broadband and now a report in the Financial Times claims that the communications regulator will launch a consultation into the price’s of BT’s wholesale fibre optic pricing which is to be done before the end of May.
Redburn Partners, who are an equities partner told the Financial Times that:
“We think Ofcom’s margin squeeze test could reduce BT wholesale fibre prices by at least £2 per month initially, with ongoing monitoring potentially leading to further cuts.”
BT are naturally not going to be pleased with Ofcom doing their investigation, especially if it does result in Ofcom agreeing with TalkTalk’s complaints and making BT Openreach reduce the wholesale prices if charges competitors for access to its fibre network.
April 2, 2014
BT have been left in a monopoly position over the rollout of rural broadband across the country that has been part funded by £1.2 billion of public funds according to a report by the Public Accounts Committee (PAC).
The Broadband Delivery UK (BDUK) scheme was set up by the government to help fund the rollout of fibre optic broadband to rural areas where it was not financially viable for BT, Virgin Media or other providers to roll out to with just their own money. The £1.2 billion BDUK pot of money to help with the roll out to these rural areas has in effect just been sent in the direction of BT as they are the only provider to have won any contracts.
The report by PAC initially raised concerns over the way the contracts were being awarded back in 2013, at this point 26 contracts for BDUK schemes had been awarded to BT, since then the other 18 contracts that have been put out to tender have also gone in the direction of BT too. Initially there were nine suppliers who were looking to bid for the BDUK funds but most of these dropped out and left the only real remaining one as Fujitsu, however they themselves had pretty much given up too which left BT to clear up all the contracts.
Another issue is the secrecy surrounding the contracts, BT stipulated that there was non-discloser agreements in place so councils could not talk to each other to see if they were receiving a good deal or not, this then makes it likely that more tax payers money will have gone to BT than perhaps needed to if there had been more openness surrounding existing contracts in place.
The other issue raised by PAC was that the broadband maps lacked detail which made it hard for other organisations to see where exactly BT would be rolling their fibre network out to and this hindered other schemes coming in to potentially fill in the gaps or offer faster speeds. They have said that the government needs to work with local organisations to make these broadband maps able to be searched down to post codes to help make it clearer where exactly will and won’t be covered.
March 27, 2014
BT has for the first time topped the complaints chart for broadband services in a report compiled by Ofcom, and it will have been a double blow for them as their big rivals Virgin Media received the fewest complaints.
Ofcom are the communications regulator and they report down all the complaints that they receive for broadband, telephone, mobile phones and pay TV. It was the first time that BT has been the most complained about broadband provider as a proportion of their customer base and it was the twelfth quarterly report produced by Ofcom.
BT received an average of 0.32 complaints per 1,000 (or 32 complaints per 100,000 customers) during Q4 2013 followed by EE with 0.29 and then TalkTalk with 0.21. The industry average was 0.17 and there was only Sky (0.08) and Virgin Media (0.07) who were below the industry average.
BT’s complains in general related to service faults and the way that complaints were handled.
The positive side to this is that this figure is down from Q3 2013 when they received 0.41 complaints per 1000.
Previous to Q4 2013 it was EE who had topped the charts for the previous 5 quarters with 0.45 per 1,000 in Q3 2013 and so again the positive side to this is that this meant that they had improved by reducing their complaints down to 0.29 per 1,000 in the 3 months that followed.
What should be noted is that only the big broadband providers who have a market share of 4% or above and receive more than 30 complaints a month are included so just because some of the smaller ISPs are not included in the report does not necessarily mean they don’t get complained about very much.
Virgin Media will have been pleased to continue their usual good record of very few complaints, even more so they will be enjoying the fact that BT Broadband, their big rival in the fibre broadband sector were the most complained about, how long before we see this as another marketing stick being used by Virgin to beat BT with.
March 18, 2014
BT has agreed a 2 week advertising deal with the company that owns the Daily Star, Daily Express & Channel 5 and will see their readers be offered 6 months free BT Broadband.
Richard Desmond’s “Northern & Shell” company own the Daily Express, Daily Star and Channel 5 and it is in these that BT will be featuring with their offers for the next 2 weeks.
We are likely to see ads, pull-outs and sponsored content in both the papers and on Channel 5. Yesterday saw the launch of the campaign on Channel 5 and a 4 page advertising feature of the free broadband offer in the Daily Express along with a front page advert on the front of the Daily Express & Daily Star.
The special BT Broadband offer will entitle readers to “BT Totally Unlimited” free for 6 months and then £16 per month thereafter on an 18 month contract. Readers of the papers will have an 0800 number to call to register for the offer or they can do so via the BT.com website where they are able to enter an exclusive reader offer code to claim the special 6 months free BT broadband deal.
As for all BT Broadband customers, they will also be able to receive BT Sport for free, this means that they can then watch plenty of live Premier League football along with many other sporting events exclusive on BT Sport.
With Channel 5 due to be sold in May, this deal from BT could have a couple of alternative motives for Richard Desmond’s Northern & Shell company. It may be that BT could be looking at maybe purchasing the TV channel and that BT are the preferred bidder or it could be a clever ploy to help put up a bidding war for the TV channel between BT & BSkyB as these are the 2 most likely suitors who are reportedly after it.
February 27, 2014
The £250 million extra funding by the government for superfast broadband in rural areas has finally been divvied up between England, Scotland, Wales and Northern Ireland.
The extra £250m which was announced by the government last year is on top of the £1.2 billion already to be given out by the Broadband Delivery UK (BDUK) project which was set up to fund the roll out of superfast broadband to more rural areas that the likes of BT & Virgin Media themselves wouldn’t roll out too on their own because of it not being financially viable to do so.
The £250m is to be split up as follows:
- England £184.34m
- Scotland £20.99m
- Wales £12.11m
- Northern Ireland £7.24m
The extra funding is being spent to help make sure that the government meets their target of reaching 95% of UK homes with superfast broadband by 2017. Superfast broadband is classed as broadband that works at 24Mb or above. A further fund of £10m has also been set up to look at connecting the final 5% with other technologies that the standard fibre optic network isn’t suitable for. This fund is due to open on the 17th March 2014 for any potential technologies that can be piloted via this scheme.
Maria Miller, the Culture Secretary said:
“Superfast broadband will benefit everyone whether they need it at work or to do to homework or simply to download music or films, thousands of homes and businesses now have access and it’s helping people with everyday tasks. We want to make sure that Britain is one of the best countries in the world for broadband and with this extra £250m that we are investing we will help ensure communities around the UK aren’t left behind in a digital slow lane.”
In previous reports and studies the government believe that for every £1 invested in the BDUK scheme that £20 will be delivered back to the UK economy by 2014. Along with this there is also expected to be many tens of thousands of new jobs created because of this in rural areas.
February 20, 2014
Newcastle is to become one of the first super-connected cities in the UK with the benefits to the area’s economy set to be boosted by £150m by becoming so.
Newcastle City Council are to use government money to help with their Go Digital Newcastle scheme that will aim to have 97% of the city able to access superfast fibre optic broadband by Summer 2015.
Around £9 million of public funds are to be used, with BT investing £1.89m, the Council investing £970,000 plus £970,000 from the Government’s Broadband Delivery UK (BDUK). Other funds come from the Governments Super Connected Cities Programme.
Along with the availability of superfast broadband, there will also be free wi-fi provided in the city centre and also on the Metro, also businesses can claim vouchers worth up to £3,000 to help them get connected too.
For more details about the scheme, visit www.godigitalnewcastle.co.uk
February 18, 2014
Go Ape, the tree top adventure company has had to shell out £30,000 to bring superfast fibre optic broadband to their new offices.
The company has moved to the outskirts of Bury St Edmunds which is close to its original base, however due to the fact that the network infrastructure in that area was out-dated it means that they had to invest £30,000 into bringing faster broadband to the offices, which their boss says will help create 100 jobs this year.
Mr Mayhew, the Go Ape boss also feared that rural locations may lose out on new jobs with fast growing companies moving into cities where they can have faster internet connections already there ready for them, rather than keeping in their rural locations where extra investment, such as what Go Ape have had to do, will be required.
“It is an incredible frustration and it really holds back the rural economy. It funnels all the job creation into Cambridge and Norwich, jobs that would otherwise be spread more evenly.”
Go Ape managed to get the faster broadband for £30,000, this is substantially lower than the £105,000 that they were quoted from one broadband provider.
January 31, 2014
BT has reported an increase in profits and sales for the last quarter of 2013.
BT reported pre-tax profits of £617m on revenues of £4.6bn for the last 3 months of 2013, this is a rise of 2% on turnover and is the first time they have had a rise since the first quarter of 2009 and also marks a substantial 6% rise in the pre-tax profits.
Much of BT’s growth has come because of the strategic investment in live sports of their BT Sports TV channel to compete against BSkyB. They now have 2.5 million customers using their TV service, many of which are BT Infinity broadband customers who get to receive free access to the BT Sports channels. BT has got a broadband customer base of 7.1 million customers with 1.9 million of those taking out a fibre optic broadband connection with BT.
In the 3rd quarter of 2013 BT Openreach took on 339,000 new superfast broadband customers (not all BT as BT Openreach is the division of BT that deals with rolling out their network), this was up 38% on a year previous. On a net basis, BT added 150,000 standard and superfast broadband customers which equated to 60% growth in the overall market.
BT have invested very heavily in the rights to live sports, with football being the main area they have put most of their money, they have spent £738m per season for 3 years for the rights to exclusively show 38 live Premier League games, they have also spent a further £900m for the exclusive rights to show Champions League and Europa League games for 3 years from 2015 too.
To view a full breakdown of BT’s Third Quarter results visit btplc.com.
January 27, 2014
Last week saw the 2014 uSwitch.com broadband awards take place at the Café De Paris in London with awards ranging from the best broadband provider, fastest broadband provider to best broadband innovation.
In total there were 12 awards up for grabs with Virgin Media & Sky scooping the most awards between them with Virgin Media claiming what we think as the main award in the “Best Broadband Provider” category. The awards were voted for by 3,000 broadband customers, uSwitch data and an expert judging panel.
In total Virgin Media won the Best Broadband Provider, Fastest Broadband and Best Customer Rated Broadband awards. They will be happy with those to put to their name, especially as broadband speeds is one of the main benefits that broadband providers use when advertising their packages.
Sky got awarded the Best TV Streaming Service, Best Customer Benefits, Best TV Provider and Best Broadband, TV & Home Phone awards.
BT didn’t fair too bad either, they gathered the Best Broadband Innovation award for their move into TV content that comes free with broadband and also the Best Broadband & Home Phone award. On top of that, Plusnet (Owned by BT) won the Best Value Home Broadband and Best Customer Service awards.
The other winner was EE who gathered the Fastest Mobile Broadband award with their 4G service.
uSwitch.com broadband expert, Marie-Louise Abretti, said:
“Virgin Media and Sky may have come away triumphant, suggesting their customers are the most content, but British broadband – though considered the fourth utility – is by no means perfect with speed, service and cost still top concerns for bill-payers.“
January 15, 2014
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A £10 million fund from the government to help get superfast broadband to the predicted 5% of the country that will not be covered by the existing Broadband Delivery UK (BDUK) funded programme has had more details revealed about it today.
The fund was originally announced in December by The Department of Culture, Media and Sport (DCMS) and today they have released a few more details as to who they want to bid for the funds. They are after companies who can offer alternative technology to help reach those in the final 5% of premises that will still need connecting. The potential technologies that will be looked at may include 4G, fibre direct to premises, improved fibre to the cabinet and extending it further down the network and also satellite.
Maria Miller, Secretary for State and Culture, Media and Sport, said:
“If we want to ensure that that all communities can benefit then we need to think imaginatively about alternative technology, and the pilots enabled by the £10m fund will be instrumental in helping us overcome the challenges of reaching the final 5% of premises.”
Currently the UK has a target of 95% coverage of premises with superfast broadband by the end of 2017, much of this has been done by BT & Virgin Media with their own fibre optic networks, however for the areas that BT & Virgin didn’t deem financially viable to roll out their networks to there has been a £1.1bn fund from the government to help extend the superfast broadband network to cover 95% of the UK. On the whole it is BT who has won the contracts for the government funds along with local councils having to match some funding too.
Chris Townsend has become the new Broadband Chief Executive, he was one of the people beind the London 2012 Olympic Games and will take on being in charge of the Broadband Delivery UK programme which also includes the extra £10 million for the remaining 5%.
Mr Townsend, said:
“Ensuring that broadband can reach businesses and consumers across the country is one of the most important policies in Government. Faster connections will improve the way people live, work and spend their leisure time. I look forward to starting my new role as chief executive of BDUK and building on the good work being done to get superfast broadband to people all over the UK.”