UK consumers are some of the earliest adopters of new communications technologies, new Ofcom research reveals.
They are among the best connected for broadband, mobile and digital TV and the UK has seen the fastest growth in smartphone take-up. UK consumers are also enjoying lower prices for communications services than many consumers across the world.
Ofcom's fifth International Communications Market report into the global communications market looks at take-up, availability and use of broadband, landlines, mobiles, TV and radio in 17 countries.
Take-up of communications services across the world is continuing at a rapid pace, despite the global recession. Ofcom's consumer research reveals that across the six countries it surveyed, expenditure on communications services remains resilient with people less likely to cut down on communications services, and in particular broadband (6-7 per cent), than they are on other areas such as nights out (39-56 per cent) or holidays (29-51 per cent).
UK households have comparatively high levels of take-up of communications services, with among the highest take-up of landlines, fixed broadband connections, mobile connections and digital TV at the end of 2009.
Germany has the highest landline take-up with 85 per cent of the population having a landline (84 per cent in the UK). Italy has the highest mobile take-up with 95 per cent of the population owning a mobile phone (91 per cent in the UK), and the Netherlands has the highest fixed broadband take-up (85 connections per 100 households, 70 in UK).
However the UK is behind other countries in take-up of VoIP services with only 5 subscribers for every 100 people, compared with 26 in France and 20 in the Netherlands. Although the UK did see an average 27 per cent annual increase in VoIP subscribers between 2006 and 2009. VoIP services tend to be more popular in countries where there is high demand for international calls or where broadband is available to consumers without the need for a landline services (also known as naked DSL).
Across most countries, the desktop PC is still the most popular device used to access the internet at home, followed by the laptop. But in the UK the opposite is true with laptops being the most popular device used to access the internet at home, used by 69 per cent of internet users. The UK is the only country surveyed where more than half of 18-24s (60 per cent) use a device other than a desktop PC to use the internet.
Mobile internet is also popular with people in the UK with 29 per cent of internet users saying they use their mobile to access the internet at home, second only to those in Japan at 43 per cent. Fourteen per cent of UK and US consumers also use their games consoles to access the internet, compared with 7 per cent of internet users in Germany.
The UK saw the highest growth in smartphone take-up in the past year with a 70 per cent rise in subscriber numbers between January 2009 and January 2010, compared to 11 per cent in Italy. Italy has the highest take-up of smartphones overall among the comparator European countries with 26 subscribers for every 100 people, followed by Spain (21) and the UK (18).
Spain, closely followed by the UK, also has the highest proportion of subscribers paying over £35 or €50 per month for their smartphone services (seven and six subscribers for every 100 people respectively). High value subscribers are more likely to use premium handsets such as the iPhone. They are also more likely to have more bundled minutes and data, suggesting that subscribers plan to use their phones more often and for more functions. The UK experienced significantly faster growth in high value subscribers than any other European country with 61 per cent growth, compared to Spain with just 4 per cent growth.
While downloading mobile apps varies little across comparator countries, use of mobile mapping and direction services has grown fastest in the UK (86 per cent increase since 2009) with nine in every 100 people in the UK using these services, compared to 5 in every 100 people in France and Germany.
People in the UK are using their mobile phones for social networking more than in other countries, with 24 per cent of UK consumers compared to 13 per cent of people in Germany. Younger people in the UK are more likely to visit social networking sites on their mobiles than in other countries, with 45 per cent of 18-24s and 38 per cent of 25-34s saying that they did this.
The number of social networkers is also higher in the UK than other comparator countries among 18-24s and 55-64s. Eighty-six per cent of 18-24s in the UK say they use the internet for social networking, compared to 77 per cent in France and 48 per cent in Japan.
Forty five per cent of 55-64s in the UK say they use the internet for social networking compared to 30 per cent in Germany and 13 per cent in Japan. Overall, Italy has the highest percentage of adults who use the internet for social networking at 63.4 per cent, closely followed by the UK and USA at 63.2 per cent.
Mobile messaging also continues to grow across the globe with Australia having the highest average use at 254 text and picture messages per person per month. The UK is second biggest text messaging nation in Europe after Ireland, with 140 messages per person per month (218 per person per month in Ireland).
The UK and Spain lead the way with digital TV take-up at 91 per cent, as digital switchover is implemented across the globe.
While UK consumers are ahead of the rest of the world in take-up of HD ready TV sets (59 per cent of UK households, ahead of the US with 57 per cent), take-up of HDTV services is lower in the UK than in other countries, where take-up tends to be linked to the amount of HDTV channels available.
In the USA, 44 per cent of households have HDTV services with access to 404 HD channels, followed by Japan (43 per cent of households and 130 channels), France (42 per cent and 55 channels) and then the UK (13 per cent and 50 channels).
Overall, UK TV viewers watched more TV than the average 207 minutes per day, watching 225 minutes, unchanged from 2008. US TV viewers watched more TV than in any other country with 280 minutes per day, followed by Polish TV viewers with 240 minutes and Italians with 238 minutes.
The UK had the second highest number of homes with pay TV DVRs (such as Sky+ and V+) at the end of 2009 with 7.8 million devices, up by 40 per cent on 2008. The USA had the highest number of homes with DVR subscriptions with 34.7 million at the end of 2009, up by more than a quarter (26 per cent) year on year.
Ofcom's consumer research also found that the UK has more consumers watching TV on the internet with just under a quarter (24 per cent) of consumers claiming to do this every week. This rose to 45 per cent when asked whether they had ever accessed TV content on the internet. People in the USA were the second most likely to watch TV on the internet, with a fifth (22 per cent) using the internet to watch TV on a weekly basis.
The availability of local and regional TV services varies widely across the world and apart from Ireland (with six), the UK, with nine, has the fewest amount of local and regional TV services available compared to other European countries and the USA. By comparison, Italy has an estimated 631 and the US has 4,758 local terrestrial TV services. The UK Government has identified this area as a development priority.
Lower prices in the UK for most communications services
Overall, prices for communications services in the UK compare favourably to those in the comparator countries - France, Italy, Germany, Spain, USA. In all of the European countries analysed, consumers can make significant savings by purchasing 'double-play' or 'triple-play' services rather than subscribing to the lowest price standalone services. The UK is cheaper for four out of the five baskets (landline phone, mobile phone, broadband) Ofcom compared, but once pay TV is also included, pricing in the UK is comparatively more expensive.
For example, for a basket typical of a family household with four mobile connections of varying use, broadband, landline and a basic pay-TV service, the research finds that the lowest service prices overall were available in the UK (£93 a month), followed by France (£106 a month). The lowest price for the landline, broadband and TV components is achieved by purchasing a triple-play service in the UK, France, Germany and Spain; however, the cost of this triple-play service is higher in the UK (£37 a month) than in Germany (£32), Spain (£28) and France (£26).
Much of the difference in prices is due to lower mobile prices in the UK although the gap in mobile prices is narrowing as prices fell by 10 per cent in the UK between July 2009 and July 2010, compared to a 25 per cent fall in Italy and a 23 per cent fall in Spain. Fixed-line prices are also lower in the UK but increased over the same period whereas they fell in other countries.
The research shows that internet users in the UK say they made more than double the number of online purchases in the past six months than internet users in any other major European country except Poland (19 and 14 online purchases respectively). The next country was Germany with nine purchases.
In addition, the total value of online purchases internet users said they made in the past six months was highest in the UK with £1,031. This was nearly double the amount spent by internet users in the next-placed country, Germany with £595.
Despite super-fast broadband being available in some parts of the comparator countries, fewer than one in 50 households in the UK, France, Italy, Germany and Spain had a superfast broadband connection at the end of 2009. This compares to 34 per cent of Japanese households. However, around the world there are large scale deployments of superfast networks and the UK compares well with its target of 66 per cent of households to have access to next-generation broadband by 2015.
Mobile broadband speeds have also increased among the comparator countries with HSPA+ and LTE services technologies being deployed in most countries throughout 2009 and 2010, with maximum theoretical downloads speeds of 100MBit/s now available in Sweden. However consumers in UK and France can only achieve maximum theoretical download speeds of 7.2MBit/s via HSPA networks as they are yet to deploy these new technologies. UK mobile operators have set out plans to build and introduce LTE networks and services over the next few years.
Digital radio take-up in the UK was the highest among the countries Ofcom surveyed with almost a third (31 per cent) claiming to own and use a digital radio. Take-up was lowest in Japan (3 per cent) and the USA (7 per cent).
Ownership and use of personal media players (such as MP3/MP4 and iPods) was highest in Italy, with nearly two thirds (64 per cent) of people and was also high in the UK with just over half (52 per cent) of people claiming to own and use such a device.
Overall, global communications revenues grew by just 0.3 per cent over the previous year, but global advertising expenditure fell by 13 per cent to £254 billion in 2009. TV remained the largest single source of advertising spend (38 per cent of total, a decline of 9 per cent on the previous year) and internet advertising expenditure grew 1 per cent between 2008 and 2009 to £37 billion. The internet accounted for a larger proportion of advertising spend (27 per cent) in the UK than in any other comparator country.
Mobile advertising spend per capita in Japan outstrips its nearest rival, the UK, by a ratio of almost 5 to 1 - but the UK is growing rapidly in line with the increase in smartphone take-up. Advertisers in Japan spends £5.57 per capita, in the UK the figure is £1.14.
However, while TV and radio advertising has declined, TV and radio subscriptions have increased, despite the economic downturn. Pay TV subscriptions increased by 5.8 per cent, and satellite radio subscriptions grew by 5.1 per cent.
Telecoms revenues also declined in seven of the 17 comparator countries, up from three in 2008. Mobile revenues are not keeping pace with increases in take-up and use, with mobile connections increasing by 16.3 per cent and call volumes increasing by 14.7 per cent, but revenues increased by just 2.7 per cent. In broadband, the UK was unique as the only country where fixed broadband revenues fell in 2009, as a result of increased take-up of lower cost LLU-based broadband services as part of double and triple play bundles.
1. Ofcom publishes the International Communications Market Report to help fulfil its commitment to understand the markets it regulates, to remain at the forefront of technological understanding, and to meet the commitment it made in its 2009/10 annual plan. The report is used widely to support Ofcom's policy development, in order to benchmark the UK's communications sector, to learn from market and regulatory developments in other countries, and to inform the context of Ofcom's regulatory initiatives. It also contributes to the richness of information Ofcom draws upon to enable it to understand how its actions and priorities influence outcomes in markets and, ultimately, for consumers.
2. The report compares the availability, take-up and use of services in the UK and 16 comparator countries - France, Germany, Italy, USA, Canada, Japan, Australia, Poland, Spain, Netherlands, Sweden, Ireland, Brazil, Russia, India and China, although we focus on a smaller sub-set of comparator countries for some of our analysis.