UK a broadband laggard as altnets grab share from incumbents

Given impetus by the pandemic and the need for acceptable broadband quality to support home networking across the country, the UK’s fixed broadband market has seen a flourishing gigabit market with the emergence of independent suppliers – altnets – biting at the heels of the industry’s largest players. However, while gigabit coverage increases apace, research has found that a lot of work still needs to be done for comprehensive ultra-fast connectivity access, according to a study from Ookla.

The research firm, the network intelligence provider behind the Speedtest mobile benchmark, examined the state of the UK’s fixed broadband market in the first half of 2022, and found the arena landscape was dynamic, with around 300 internet service providers (ISPs) serving the market.

In all, fixed broadband internet reached 86% of UK households at the end of 2021, with most customers having access to speeds of at least 30 Mbps. While seven large ISPs dominated the UK’s fixed broadband market, the competitive landscape is vibrant, hosting dozens of altnets, but only a few providers were offering nationwide coverage.

Ookla observed that the median fixed broadband speed in the UK was heavily influenced by the network technology offered by leading providers, which predominantly rely on copper-based network infrastructure supplied by Openreach, which has allocated £12bn to upgrade its copper network to fibre. In August 2022, Openreach reported that its FTTP network passed eight million premises and is on target to provide fibre service to 25 million premises by the end of 2026.

While the market was dominated by the larger companies, the Ookla Speedtest Intelligence data revealed that smaller providers were sometimes the fastest across a few cities and counties. The research showed that across the UK in the first half of 2022, the median broadband download speed was 61.69 Mbps, with a median upload speed of 17.63 Mbps.

Northern Ireland ranked first for median download speed at 65.21 Mbps, followed by England (62.40 Mbps), Scotland (57.13 Mbps) and Wales (49.71 Mbps). Yet despite the growth, the analyst said it would have expected some markets to transition to fibre more swiftly, and provide users with faster median download speeds, but haven’t yet done so. By August 2022, the UK ranked 55th, with a median fixed broadband download speed of 66.22 Mbps and an 18.25 Mbps upload speed.

Virgin Media O2 was the UK’s fastest fixed broadband provider, achieving a median download speed of 116.44 Mbps and an upload speed of 20.86 Mbps during Q1-Q2 2022.

Across the 146 British counties researched, Speedtest Intelligence data showed that in Q1-Q2 2022, Virgin Media O2 was the clear speed leader, clocking the top download speeds in 71% of those counties. Virgin Media O2, having already upgraded its network to DOCSIS 3.1, plans to migrate to fibre to the premises (FTTP) over the next few years. The company is also planning to challenge Openreach in the wholesale market in a new joint venture. Altnets had the top speeds in London, Glasgow, Liverpool and Manchester, as well as across a number of counties.

The number of homes with gigabit-capable fixed broadband reached 19.3 million (66% of all UK homes) in January 2022, up from 13.7 million (47%) in September 2021.

The analyst noted that public funding has helped facilitate the emergence of fibre ISPs in rural areas where fibre deployment is not commercially viable. It cited firms like Hyperoptic, which it said were already well established, and deploying and operating an FTTP network in areas with high density.