60% of UK Broadband Lines Will Be Superfast by 2016

LONDON - The U.K. will have more than 10.5 million subscribers to superfast broadband (fiber to the curb or fiber to the home) within the next five years, broadband analyst firm Point Topic predicts. With another 4.6 million cable broadband connections, this means that almost 60 percent of the country's broadband customers – and more than half of all homes and businesses – will be using speeds of 30 Mbps or more by the end of 2016.

“It’s still a risky and controversial forecast,” says Tim Johnson, chief analyst at Point Topic. “It is always difficult to predict something which is expected to grow so fast. If the forecast is correct, the number of superfast lines will grow 50 times over between mid-2011 and the end of 2016.”

The forecast is controversial because of uncertainty about both the technology and the market. British incumbent telco BT is a late starter in this area. The technology it is using will be mainly fiber to the cabinet (FTTC), where the copper loops are reduced to only a few hundred meters. According to Johnson, telcos in Europe and America have found FTTC challenging to roll out and to connect customers economically.

“Even more fundamentally, the strength of demand is not there yet,” Johnson points out. “Users are not exactly crawling over each other to get superfast broadband today. But we do believe that the demand for bandwidth will continue rising steadily, just as it has done for the past 15 years.” By 2016, he forecasts, 30 Mbps will be regarded as a good standard connection in the U.K., and 100 Mbps will be regarded the same way by 2021.

In addition to BT, a number of other companies are rolling out fiber in the U.K. on a smaller scale.

BT Accelerating Rollout
BT is already running slightly ahead of Point Topic’s forecasts for this year and recently announced it would accelerate its FTTC rollout by a full year. “BT is doing better than we expected a few months ago,” says Johnson. “Speeding up the rollout shows they are getting on top of the problems.”

BT’s revised plan aims to ensure that at least two-thirds of homes and businesses in the UK will have superfast broadband available by the end of 2014. Point Topic’s forecast projects that not only will superfast be widely available, but also that it will be taken up by users in commercially attractive numbers.

Four years ago, Point Topic forecast there would be 20 million broadband lines in the UK by mid-2011. The actual total was 20.16 million, an error of less than 0.8 percent. “We’re unlikely to be quite so accurate with superfast broadband over the next few years,” admits Johnson. “It’s going to be a much more dynamic market.”