UK market data – telecomms, advertising, broadband and the Grey market

Its always good to understand the market that we work in and the “Communications Market Report  by OFCOM” is a great piece of research.

Here are some of the key findings.

Adoption rates

Two and a half million DAB digital radio sets were sold in the year to June 2008, taking total cumulative sales to 8.3 million.

The UK is moving towards faster broadband with huge investment in fibre optics. BT (which aims to reach 10 million homes by 2012), and Virgin (which aims to reach 9 million homes by the end of 2008).

Digital television penetration rose by 7.5 percentage points over the year to Q1 2008 to reach 87.1%.Two and a half million DAB digital radio sets were sold in the year to June 2008, taking total cumulative sales to 8.3 million.

Communication services by the Grey market

The adoption of broadband by the over 65 is growing faster than in the <65 yr old category.  So, the gap is narrowing.

Older people spend significantly more time than the UK average using many key media. In 2007 the over-65s spent 83 more minutes a day (38%) watching television and 20 minutes longer (12%) listening to the radio. Those with an internet connection spent 30 minutes longer (50%) online per day than the UK average, although they accounted for just 6% of total UK internet usage because take-up was lower among this group.

The most popular internet activity among older people is ‘communication’ (using email, instant messaging and chat rooms for example); 63% of over-65s say they communicate online, compared to 76% of all adults.

Older people remain much lower users of mobile phones than the general population. 

The Advertising market

The UK’s advertising market grew by 6.3% to £14.9bn in 2007, the largest growth rate for three years and the first year in which growth has outstripped inflation since 2005.  Most of this came from internet advertising, on ave. >70% per year!

Television advertising revenue remained static in 2007, at £3.5bn. 

Television advertising revenues continue to face challenges; 23% of homes now own a digital video recorder (DVR), up from 15% since Q1 2007, and 88% of DVR owners claim that they usually fast-forward through commercial breaks when watching recorded programmes (which currently account for 14% of viewing in DVR-owning homes).

Advertising spend on radio advertising increased during 2007 for the first time in three years, up by £5m (1%) in the year to £442m. However, radio’s share of total advertising revenue continued to fall, from 3.0% in 2006 to 2.9% in 2007 as internet advertisng and broadly onsite grows.

Converging technologies

Overall in 2007 there was a huge movement towards multi devise. Digital television rose from 80% to 87% of households.  MP3 player ownership stood at 45% of individuals (up five percentage points) while consumers with access to a DAB digital radio nearly doubled to 27%.

The internet emerged as a popular platform for broadcasters for the distribution of audio-visual content in 2007/08. Many TV broadcasters started downloads of programmes, live TV, extras and supporting information. 

Twenty-six per cent of those aged 15-24 claim to use the internet for ‘watching TV programmes’ in 2008, up by 16 percentage points in twelve months. Fifty-one per cent used it for ‘watching video clips/webcasts’, also up by 16 percentage points over the same period.

Mobile broadband emerged in 2008 as an increasingly popular means of accessing the internet. The five mobile network operators have all begun to target their mobile broadband offers at residential consumers, and while the subscriber base is relatively low, it is growing fast. There were over 500k new connections in the five months from February 2008, with 133k connections in June 2008. Seventy-five per cent of those with access to mobile broadband use it at home, 18% do so at work and 27% while elsewhere/on the move.

Mobile phones – in 2007, 41% of mobile phone users claiming to use their handset for taking pictures and 15% uploading photos to their PC.

A quarter of people confess to stream, download or copy unauthorised music with the proportions for film and television programmes standing at 15% and 13% respectively. 

40% of households have taken up a media bundle in 2007 and there are more and more competitive packages available in 08.

Television

Total television industry revenue reached nearly £11.2bn in 2007, up 3.8% from 2006. 

The TV industry outputted 2.1 million hours in 2007 (2006: 1.8 million). Channels within the Entertainment, Factual, Children’s, Sport, News, Leisure and Music genres accounted for just over one million of these hours. Original content only made up for <10% of the content.

HD TV has been slow for the uptake.  In the UK the subscribers are less than 1 million.

Telecomms & Broadband

Seventy per cent of people with a mobile and a fixed-line phone use their mobile to make some calls even when they are in the home; ten per cent of people with a fixed line at home never use it, claiming that they always use their mobile.

Although still increasing, the rate of broadband growth is slowing; by the end of 2007, 58% of UK households had a broadband connection, up from 52% a year previously and from 41% two years ago. 

The number of 3G connections (including mobile broadband connections) in the UK increased by 60% during 2007 to reach 12.5 million by the end of the year, amounting to 17% of all mobile connections.

More adults in the UK use text messaging than use the internet: 59 billion SMS messages were sent in 2007, an average of 68 a month sent from each mobile connection (up 28% on 2006).

The majority of children aged 5-7 have access to the internet and most children aged 8-11 have access to a mobile phone. Children are more likely to use the internet for instant messaging than for email.

The best thing to do is read the original report at the OFCOM site >>

 

 

About Adrian Land

Adrian has been SEO'ing since '98 and is the Head of Inbound Marketing at My Destination and the Managing Partner of the Inbound & SEO performance agency SeSoMe.
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