Broadband competition reaches new milestone

07 February 2012

Competition in the UK's broadband market has reached another significant milestone.

The number of unbundled lines - where communications providers such as Sky or TalkTalk offer services over BT's copper telephone network - has passed the 8 million mark.

At one time most people could only get their broadband and landline telephone service from one provider - BT.

But a process known as Local Loop Unbundling (LLU) changed that.

Unbundled lines

It allowed phone companies other than BT to install telecoms equipment into the local BT telephone exchanges.

Since 2005, the number of unbundled lines has increased from 123,000 to hit 8.02 million in January 2012.

The spur for the surge in unbundled lines was a set of legally-binding Undertakings that Ofcom agreed with BT Group.

Firms other than BT were then able to install their own telecoms equipment into the local BT exchange.

Greater choice

These telecoms companies could then offer their own direct phone or broadband service, which in turn gave consumers a greater choice of providers.

Today there are dozens of companies offering unbundled services to homes and small businesses and millions of homes and small businesses have switched to providers other than BT.

For instance, in 2005 just 4 per cent of households had their landline with providers other than BT or a cable provider - now 35 per cent take their landline from an alternative provider*.

Broadband boost

Unbundled lines have also transformed the broadband market.

Ofcom's research shows that there are now over 20 million residential and small business broadband lines in the UK*. Of these, more than 70% are provided by companies other than BT, many on the basis of unbundled lines.

And greater competition has meant lower bills for consumers.

Ofcom research shows that consumers are on average paying half the price for their broadband service than they did in 2005.

Notes

*Data from: Ofcom's Communications Market Report 2011 and Ofcom's quarterly telecoms market data