Thursday, 24 May 2018

TechUK: UK broadband customers get a lot of gigabytes for their buck

By Chris Kelly, Total Telecom
Wednesday 16 May 18

In the run up to Connected Britain 2018, Total Telecom met with Jacqueline de Rojas, president of TechUK, to discuss the evolution of connectivity in the UK

What trends are you noticing in Britain’s broadband sector at the moment? The retail broadband market in the UK remains highly competitive. This means that UK consumers continue to get better value for money broadband than those in many other countries, evidenced by BT and Vodafone competing fiercely on bundled fixed and mobile broadband, and the competition between mobile operators over data capacity. We get a lot of gigabytes for our buck but average revenue per user for operators is plateauing. This in turn is reduces the incentives to invest in superfast broadband and the margins are far more attractive in markets outside the UK Increasing average downlink speed and data volume increasingly challenges mobile broadband’s ability to compete with fixed broadband. Over the medium-long term, this trend will play to the strengths of fibre; however, for now, other than for business and academic use, online use is overwhelmingly via Wi…

What trends are you noticing in Britain’s broadband sector at the moment?

The retail broadband market in the UK remains highly competitive. This means that UK consumers continue to get better value for money broadband than those in many other countries, evidenced by BT and Vodafone competing fiercely on bundled fixed and mobile broadband, and the competition between mobile operators over data capacity. We get a lot of gigabytes for our buck but average revenue per user for operators is plateauing. This in turn is reduces the incentives to invest in superfast broadband and the margins are far more attractive in markets outside the UK

Increasing average downlink speed and data volume increasingly challenges mobile broadband’s ability to compete with fixed broadband. Over the medium-long term, this trend will play to the strengths of fibre; however, for now, other than for business and academic use, online use is overwhelmingly via Wi-Fi which, with today’s routers, acts as a chokehold on the speed which an ultrafast connection could actually provide to a subscriber.

There is a lot of work being currently done to improve the reliability and availability of mobile broadband coverage along our country’s transport corridors. Many of us who want to work, or just keep in touch, while travelling see the necessity of this. This is now part of new Ofcom coverage obligations, so we can expect to see a push by operators to provide public comms infrastructure down British train tracks and the Strategic Road Network. 

 

In the race to roll out superfast connectivity, is there still a role for copper-based technologies or should we be solely focussing on fibre?

With Openreach announcing an acceleration of its Fibre to the Premises (FTTP) programme, Vodafone’s plans to provide up to five million UK properties with "full fibre" internet connections and TalkTalk announcing plans to lay full fibre to three million homes, it looks like Matt Hancock’s call for full fibre has been heeded.

Fibre is future-proofed and Ministers and operators recognise that subscriber demand for faster connections, and rapidly increasing capacity usage cannot be fulfilled by copper-based tech. Fibre also suffers far less from signal loss over long line lengths. It is also far more reliable than copper, with more resistance to heavy rain or flooding, so reduces downtime, vital for business use. Wide availability of fibre will also be essential to support the 5G networks and tech that relies on it over the next three to five years’ time.

After agitating for years for action on improving the conditions for the deployment of 5G, techUK is delighted that this is now being addressed. techUK is working with DCMS and on their local connectivity initiative, addressing obstacles to deployment, and we support Matt Hancock’s Barrier-Busting Task Force. There’s a long way to go, but it’s a start!

 

What new technologies are you particularly interested in at the moment?

I am interested in anything that offers complete coverage across the country. Infrastructure matters and we must push to connect every citizen no matter where they live. 

In that vein, 5G has deservedly received a lot of attention recently. This generational upgrade is about more than just faster speed, 5G also promises lower latency, greater resilience, and the ability to support large numbers of users per cell.

Many major companies have invested huge amounts of money in developing 5G, suggesting that it will offer a real jump in performance.

What is less clear is what the new use cases requiring 5G will be. The UK has a booming fintech sector; a successful games sector; a large music sector; and we’re still the European start-up leader. So, if the UK is to be – as the Government would like – a 5G leader, then we have to provide the right conditions for innovative new uses to be developed, trialled and launched.

I am delighted that DCMS is focussing so much on innovation in 5G at the moment and it will be fascinating to see what emerges from the Testbeds and Trials programme.

 

What are the key drivers in rolling out superfast connectivity in the UK – Why do we need it?

Inclusion matters! We must develop and innovate for the people who are on the fringes as well as for those of us who live close to large cities, 

The 5G rollout will be driven by the development of new technologies within consumer hardware and software that will simply require superfast connectivity. AR and VR market is developing rapidly and handset makers are developing the necessary hardware to support this. For this to come together, however, it is in the immediate interest of all these industries to rollout 5G. The resulting market opportunities for other industries, such as entertainment and advertising, could see innovation skyrocket. At the moment, though, most retail subscribers don’t see a need for superfast until compelling new uses come to market and we are likely to see consumers upgrade to 5G when they upgrade their handsets.

The need for superfast connectivity is perhaps closer to home. The number of connected devices in our homes is dramatically increasing. The benefit of superfast, really isn’t just in speed, it is in the number of devices that it can support. This is a key driver as our lives at home become more closely connected and digital.   

From a business perspective, as SMEs come online they tend to become very reliant on their broadband, and often dissatisfied with the package they first signed up to. As more businesses adopt cloud services and optimise their websites for mobile, that reliance on being online can only increase. Most rural SMEs will be currently unable to upgrade due to lack of availability in their area of superior packages – that is an opportunity and we need to support small businesses in this area. 

 

What predictions do you have for the industry over the next year to 18 months? 

I believe that connected devices will introduce the concept of ‘swarm robotics  technology’ in areas like traffic management and even in health for example. 

We will probably see greater use of ‘digital twin’ technology. As our physical infrastructure becomes much more heavily digitised, to improve its efficiency, we will need them to also exist in the virtual world and be subject to more intelligent modelling. This will also of course, further increase our need for the cloud. 

I think that we will see better applications for VR, as the hardware becomes cheaper, but more likely to be adopted quicker will be mobile AR. This is largely because, unlike VR, AR won’t require people to buy new hardware and it has a more social element to the experience.

Enterprise IoT will reach a critical juncture and will finally really take off as companies in sectors, such as manufacturing, can fully make the case for the benefits through data and encouraging all businesses towards becoming more digitally-enabled. 

We will also see a major uptake in-home medical diagnostic services for millions of consumers with chronic conditions. This is a really important space in which innovation can prove to have a very positive impact on people’s lives and something which our industry must promote and be proud of. 

 

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