The British telecoms regulator has concluded that the UK has a competitive market for narrowband Internet access, with nearly half of all UK households now being online.
Forty-five percent of British homes are connected to the Internet -- a 15 percent increase on the number of online households at the same time last year. Twenty-eight percent of these 11 million connected homes have also opted for an unmetered access package.
Oftel published the figures on Tuesday in a consultation on effective competition in dial-up Internet access. The review looked into the narrowband market (unmetered and metered) including ISDN, and considered one retail and three wholesale markets used by Internet Service Providers (ISPs).
"Dial-up narrowband Internet access is how most consumers start using the Internet, so it is important we have a thriving and competitive Internet access market," said David Edmonds, director general of telecommunications at Oftel. "Dial-up Internet access also acts as a stepping stone to faster broadband services as people use the Internet to study, shop and for entertainment."
Oftel concludes that residential and business dial-up Internet customers are getting a competitive deal, with UK prices comparing to the best in the world. California and Ohio were the only named locations within the report to offer better access prices than Britain for home users. The main type of Internet package used at home in Britain is the non-subscription pay-as-you-go deal, adopted by 40 percent of online homes. But Britain has experienced an 8 percent growth in the number of households using fully unmetered services in the last year.
Three in 10 connected UK homes now have more than one fixed line -- a small rise from 27 percent a year ago. Internet usage is the predominant reason for multi-line use. According to the report, homes with Internet access are also more likely than non-Internet homes to use a cable supplier.
On the wholesale side, Oftel admits within its consultation that BT is stifling competition, by retaining 80 percent of the wholesale market share. On Monday, the regulator announced it was hoping to make a number of changes to the way that Internet service providers (ISPs) buy unmetered Internet capacity from BT. This will include letting ISPs pay for unmetered services on credit, rather than in advance -- a move that could help companies keep down the cost of surfing.
"Action by Oftel, notably the requirement on BT to offer wholesale unmetered Internet access, has helped to put this flourishing market in place. The network charge control also offers robust protection to consumers," said Edmunds.