UK Consumers Using More Communication Services - but Paying Less

People in the UK are spending more time using communications services than ever before - but paying less for them, according to the annual report from the UK's telecoms regulator, Ofcom. The report shows that in 2007 Brits spent an average of 7 hours and 9 minutes a day using an array of communications services - up by 6 minutes from 2002. This includes watching television, surfing the net, using mobiles, talking on a landline phone and listening to the radio.

Despite this growth in use and take up, when it comes to paying for communications services, consumers get more for their pound. Overall average household spend on communications services was £93.63 (US$176.66) a month in 2007, a fall of £1.53 (1.6 per cent) on the average spend in 2006 and a fall of £4.31 (4.4 per cent) since 2004.

This compares to big price increases for other goods, with food prices up by almost 7 per cent and the overall retail price index (RPI) rising to 4.1 per cent in 2007.

There are three main reasons behind the fall in the price of communications services:

Broadband Internet

Take-up of broadband through a landline grew from 52 per cent of households to 58 per cent in 12 months, mainly as a result of consumers upgrading from dial-up access to always-on broadband.
Following the launch of marketing campaigns for mobile broadband devices which enable consumers to access the internet on the move, there has been a surge in take-up with around 2 million adults in the UK saying that they had used a 3G data card, USB modem or dongle to access the internet in March 2008.

The driver of this has been the sale of dongles - small devices plugged into the USB port of laptops enabling internet access via a mobile network. Between February and June 2008, the number of dongle sales to consumers nearly doubled from 69,000 to 133,000 a month. During this five month period, there were 511,000 new mobile broadband connections in the UK.

Three-quarters of all mobile broadband users say that they access the internet via their dongle while at home and two-thirds of mobile broadband users say that they use both dongles and their landline to connect to the internet.

More than one in ten mobile phone users have accessed the internet on their mobile phone with the number of 3G mobile connections growing by 60 per cent in 2007 to reach 12.5 million subscribers - an increase of 4.7 million in 12 months.

The Environment

With climate change high on the agenda it is not surprising that seven in ten people say that they care about the environment. And while a third of people are aware that their household devices consume more power now than they did two years ago, fewer than four in ten (39 per cent) consider the impact on the environment when buying a communications device. This is much lower than in other sectors. When Brits buy white goods, for example, more than half (54 per cent) said that the environment was a factor in their decision.

Two-thirds of consumers claim to turn devices off to save energy but many use power unnecessarily. More than half of British consumers leave their set-top boxes on standby when not in use.

Telecoms

The report says that by the end of 2007, there were almost 74 million mobile connections serving a population of 60 million in the UK. This was an increase of 3.7 million connections since the end of 2006. The total number of mobile connections increased by 48 per cent in the five years from 2002.

Seven out of ten people with a mobile phone and a landline use their mobile to make calls, even when they are at home. One in ten people with a landline at home said that they never use it to make calls.

In the UK, nearly 60 billion text messages were sent in 2007 - an increase of 36 per cent since 2006 and up by 234 per cent since 2002 when we sent 17 billion texts. The average mobile phone user sent 67 texts per month from each mobile compared to 53 texts per month in 2006.

The majority of children have access to the internet and most have a mobile phone but they use them in different ways. Boys aged 8-11are twice as likely to use the internet every day than girls of the same age (45 per cent compared to 22 per cent). Meanwhile girls aged 12 -15 are more likely to use a mobile phone than boys of the same age (74 per cent compared to 65 per cent).

Peter Phillips, Partner, Strategy and Market Development, said: "We are spending more and more time with our communications devices but spending less on them. Our devotion to watching, listening and staying in touch wherever and whenever we want shows no sign of diminishing and, with healthy competition, overall prices offer increasing value for money. That is what consumers demand and what Ofcom helps deliver."

The full document can be found here: www.ofcom.org.uk/research/cm/cmr08/

Posted to the site on 14th August 2008