Ref: 32/03
Date: 4 June 2003

Consumers continue to pay some of the lowest prices in Europe for residential broadband services as a result of the UK’s competitive broadband market, Oftel announced today.

Oftel’s latest international benchmarking research shows that residential broadband services are cheaper than in France, Germany and the US, with only Sweden offering a slightly cheaper service than the UK.

Competition between service providers and network providers has resulted in cheaper broadband prices for the consumer. Prices for residential broadband services dropped by six per cent in the last six months and the take-up rate has remained consistently high with up to 35,000 new subscribers a week.

Peter Waller, Deputy Director General of Telecommunications, said today:

"Oftel’s research shows that UK residential consumers pay less for their broadband services than people in France, Germany and the US. Only Sweden offers slightly cheaper service than the UK. Lower prices has resulted in increasing numbers of people signing up for broadband.

"Service providers in the UK are offering competitive broadband to consumers through a choice of platforms including a number of DSL and cable providers, resulting in a six per cent drop in broadband prices in the last six months."

Oftel’s survey also shows that International benchmarks of UK prices for fixed line and mobile services compare favourably with European countries.

Notes to editors

1. International benchmarking study of Internet access (dial-up and broadband) is available on Oftel’s website at www.oftel.gov.uk/publications/research/2003/benchint_1_0603.htm and International benchmarking study of mobile services is at www.oftel.gov.uk/publications/research/2003/benchmob0503.htm and international benchmarking study of fixed services is at http://www.oftel.gov.uk/publications/research/2003/benchfix0603.htm. Hard copies are available to the media from Oftel's Press Office, telephone 020 7634 8991, and to the public from Oftel's Research and Information Unit, telephone 020 7634 8761.

2. The reports look at: Internet access via dial-up PSTN, DSL and cable modem; mobile services; and fixed line services. The countries considered in the studies were France, Germany, Italy (mobile only) Sweden, the UK and the US states of Ohio and California (not included for mobile). The analysis and drafting of the reports was carried out by Oftel. The tariff data used in the reports have been collected by consultants HI Europe and Analysys. The results are based on a snapshot of prices as at February 2003.

3. The survey was conducted to benchmark UK prices against those of a number of other countries and US states and should not be seen as recommended 'best buys'. When making a purchase decision, consumers will want to access the latest pricing information, as well as taking into account other factors such as service features, personal usage patterns, terms and conditions and indeed any other factors that they feel are relevant to their needs.

4. Since the December 2002 report, Oftel has published a market review of broadband in which broadband is considered to be an always-on service in excess of 256kbit/s. For consistency, the minimum speed of the residential broadband and the low speed business basket has been changed from 129kbit/s to 257kbit/s. An additional "entry level" always-on residential basket has also been included to take into account the lower speed always-on services available in most benchmarked countries: the minimum speed of the additional basket is 128kbit/s.