Bell Sounds for British Broadband Brawl

A broadband brawl is brewing in the U.K. as some of the biggest hitters in the business look for an edge in the fight to gain high-speed access subscribers.

BT Group plc (NYSE: BT; London: BTA) today announced a surge in its retail DSL customers in the last three months of 2006. The incumbent carrier says its share of new DSL subscribers in the quarter ended December 30, 2006, was 34 percent, its highest in two years. And way higher than the 25 percent share of new DSL subscribers in its second quarter. (See BT: 21CN Slips, IPTV Nears.)

BT added 239,000 new DSL customers, taking its total retail broadband customer base to just over 3.2 million, which, as the U.K. had about 10 million active DSL lines at the end of 2006, gives it a 32 percent market share. (See BT Boasts DSL Milestone.)

Its retail broadband revenues in the third quarter were £233 million (US$456 million).

BT has run a high-profile marketing campaign pushing its broadband service during the past six months and is about to launch a new advertising campaign focused on its IPTV service, BT Vision, which the carrier launched in December. (See BT Focuses Its IPTV 'Vision'.)

BT's better broadband performance and financial performance, plus a tax credit of £1 billion ($1.96 billion), helped to push the firm's share price up by 2 pence, just short of 1 percent, to 318.5 pence.

BT's share price has risen by about 50 percent in the past year.

Like a Virgin
While BT takes the plaudits for its broadband recovery and continued financial health, NTL is timing its jab.

The cable giant relaunched itself today as Virgin Media Inc. (Nasdaq: VMED), a "quad play" (fourplay?) service provider offering broadband, fixed voice, TV, and mobile services, the latter courtesy of its Virgin Mobile UK acquisition. (See NTL Relaunches as Virgin Media and NTL Takes Virgin.)

The company has about 5 million fixed-line customers, of which more than 3 million are cable broadband customers and 4.5 million mobile subscribers.

It's counting on its bundle of four services to woo customers, though the firm will have to overcome its shocking customer care reputation if it's to make any serious gains from the likes of BT and Orange UK . (See Orange Juices Free Broadband Battle.)

Despite that poor reputation, the company says it is addressing that side of its business, investing in more people and better systems to deal with its customers.

Gunning for Sky
The puncher all the DSL players would love to floor is Sky , which scuppered NTL's plan to acquire British broadcasting firm ITV plc (London: ITV) late last year. (See ITV Rejects $8.9B NTL Bid, NTL Abandons ITV Bid, and OFT Probes Sky's ITV Stake.)

Sky has more than 8 million satellite TV customers and is now aggressively pushing its broadband service, making it Virgin Media's most direct competitor on two key fronts. And there are signs that Sky is brewing up some sort of serious entry into the mobile world, too. (See BSkyB Reports H1, BSkyB Gets Googly, BSkyB Tests MediaFLO, and Murdoch's Sky Takes on BT.)

The two companies traded verbal blows this morning, with Virgin Media executives accusing Sky of overcharging for the rights to show its premium sports and movies channels, which Sky is obliged by U.K. competition law to sell to all its rivals. Sky, in turn, accused Virgin Media of being a sore loser.

Expect that "handbags at dawn" scuffle to run and run.

Tiscali's Telco TV Target
Itching to join the fight is Tiscali UK , which, having acquired IPTV specialist Homechoice last year, is now rolling out its telco TV services throughout the Kingdom, with an introductory offer of £14.99 ($29.30) for broadband and IPTV. (See Tiscali Buys Into IPTV.)

The company currently has about 1.4 million DSL subscribers, more than 40,000 existing IPTV customers from Homechoice, and is in the process of unbundling the local loop and installing its own DSLAMs around the U.K., with a view to passing 10 million U.K. homes by the end of 2007.

Ovum Ltd. analyst Michael Philpott reckons that, while Tiscali will struggle to tempt customers from the "high-end pay-TV market" dominated by BSkyB, it will offer a credible alternative to BT Vision in the "mid to lower end… [if it] can get the vastly important marketing and customer service elements right."

— Ray Le Maistre, International Pugilism Editor, Light Reading

digits 12/5/2012 | 3:14:56 PM
re: Bell Sounds for British Broadband Brawl ANyone hooked up and using BT Vision? If so, what's it like?

kentishman 12/5/2012 | 3:14:21 PM
re: Bell Sounds for British Broadband Brawl Hi Ray

There seem to be quite a few people on here discussing it. So the answer must be yes.


It seems to have started life full of bugs (doesn't everything. But is improving. For myself I applied for it two months ago but have not had been given the opportunity to sign up yet. I think it is what might be called a soft launch as they are being very selctive about who gets it. (That is you have to be on BT Option 3 to get it for -ú90 the box being Free).

Anyway might make an intersting article in the near future.
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