The Communications Market Report: United Kingdom
TV, phones and internet take up almost half our waking hours
UK consumers are spending almost half of their waking hours watching TV, using their smartphones and other communications devices.
At the same time Ofcom's annual Communications Report into the UK's TV, radio, telecoms and internet industries also shows that we're media multi-tasking more than ever before.
Media multi-tasking where, for example, a phone call is made while surfing the internet now accounts for 35 per cent of all media consumed throughout the day and the younger the person, the more media activity is done at the same time.
Among 16-24s, over half (52 per cent) of their media activity is simultaneous, compared to just over one fifth (22 per cent) for people aged over 55.
The growing popularity of smartphones and the changing way we use our mobiles is increasing our overall use of communications, and helping us do much more simultaneously.
But while we are doing more, it is costing us less.
For the fifth year in a row spending on communications services has decreased.
Real household monthly spend on communication services fell 1.7 per cent over the past year to 91.24, as more people choose to buy their services in discounted bundles.
Half of all UK households now buy a bundle of two or more services from a single provider compared to 29 per cent in 2005.
Seventy per cent of people with a bundle said that the main reason for taking a bundle was because it was cheaper.
The report also shows that traditional media is far from dead, with TV retaining a central part in our lives, particularly in the evening.
And its not just scheduled live television which continues to be popular - the number of people watching catch up TV services also increased by more than a third over the past 12 months.
Watching TV remains the activity that most adults would miss the most.
Nearly a quarter of people (22 per cent) say they have bought a HD-ready TV set in the last 12 months.
Some 31 per cent of households with internet access used it to watch online catch-up TV - up 8 percentage points over the year.
The proportion of time-shifted television viewing has more than tripled since 2006, from 1.7 per cent to 5.9 per cent.
Last year UK TV revenue as a whole contracted for the first time since 2003, down by 0.4 per cent to 11.1bn.
People listen to 20.1 hours of radio per week.
Some 35 per cent of people own at least one DAB digital radio.
Total listening hours to all BBC Radio stations were down by 1.2 per cent during 2009 and down 2.2 per cent on five years previously.
All commercial radio listener hours were stable in the year but down 10.1 per cent over five years.
Despite less time being spent on radio listening the number of people listening reached a new high of 90.6 per cent (46.5 million adults) listening on a weekly basis by the first quarter of 2010.
Broadband take-up has now reached 71 per cent.
Some 37 per cent of over 55s use email each day and 47 per cent use it weekly.
Social networking accounts for nearly a quarter of all time spent on the internet.
The average Facebook user spent 6.5 hours on the site during May 2010.
Usage of instant messaging declined from 14 per cent to 5 per cent.
Consumers sent a record number of texts (over 100 billion) in 2009 equivalent to 1700 for every person in the UK (compared to 1200 in 2008).
Data volumes over mobile networks increased by 240 per cent in 2009.
Over a quarter of people in the UK (26.5 per cent) said they have a smartphone, more than double the number two years ago.
Nearly a quarter of adults (23 per cent) accessed content or sent emails on their mobile phones. Among 15-24s this rises to 45 per cent.
UK consumers who have internet-enabled phones are also spending almost as much time surfing the net on their mobiles (1.3 hours per month) as they do texting (1.5 hours per month).
Facebook accounted for almost half (45 per cent) of total time spent online on mobiles in December 2009
The market context
- Introduction
- Availability: DTT signal extended to over 80% of households
- Mobile broadband drives increase in broadband take-up
- Total communications industry revenue fell for the first time
- Time spent on internet and mobile telephony continues to grow
- Overall satisfaction with communication services
- Growing importance of television among younger and older users
- Household spend on communications services continues to fall
- Introduction to the consumers digital day
- Structure of the consumers digital day
- Key Findings of the consumers digital day
- quantitative research study into consumers media and communications activities
- Terminology used in this section
- Consumer take-up of digital communications devices
- Younger people are more likely to adopt new technology
- Consumer behaviour across the day
- Television is the dominant form of media consumption in the evening
- Overall media and communications consumption
- Younger people undertake more media and communications activities in total
- but spend less time doing so
- Patterns of media and communications consumption, by device
- Over half the time people spend on media and communications activity makes use of a TV or radio set
- Younger people are most likely to use the TV set for gaming or watching DVDs
- Two-fifths of peoples time on a computer is spent communicating with other people
- For many people, voice calls account for a minority of mobile phone use
- Patterns of media and communication service consumption, by activity
- Watching television is most popular among people over 55, text communications is most popular among 16-24s
- Watching video content occurs mostly in the home, while listening to audio is often done elsewhere
- Landline phone calls are more likely to be used for work than mobile phones, particularly among younger people
- The role of multi-tasking in media and communications consumption
- People are more likely to consume video, audio, and print media on their own, while text-based communications tend to be undertaken concurrently
- The majority of activity on mobile phones and computers occurs concurrently with other media consumption
- Watching video on a TV set and listening to the radio on a radio set are most likely to be undertaken without other media
- Media multi-tasking is common throughout the day
- Watching scheduled TV on a TV set is most likely to be done on its own in the evening, without consuming other media
- Text-based communications is the most popular concurrent media activity throughout the day
- Attention and importance paid to media
- Traditional media holds peoples attention even when it is undertaken with other media
- Communications activities are given the highest importance, particularly email and text messaging
- Traditional media is seen as important, even when attention scores are lower
- Younger people place greater value on texting than emailing
- Email is the most important activity for older people, and commands the most attention
- One in two households buy their communications services in a bundle up from less than a third five years ago
- Bundling of communications services
- Context
- But less than half of all households with a broadband, fixed voice and pay-TV service currently buy these together in a triple-play bundle
- Younger and older bill payers are less likely to take communications services in bundles for different reasons
- Bundles by socio-economic group
- Cost savings are the main reason for taking a bundle; but customers also appreciate the convenience
- Perceived benefits of bundles
- Three in five people who buy their communications services in a bundle claim that they receive a discount for buying these services together
- Consumers tend to build bundles around a particular communications product
- Many consumers see buying a bundle as a good way of trying out a new service
- Consumers who buy bundles claim to be more satisfied with their communications services than those who do not
- key drivers of satisfaction with bundled services
- 15% of those with bundles have switched supplier for at least one service in the last year
- switching
- switching bundles
- Communications markets and the economy
- Economic trends and consumer attitudes towards the economy
- Consumer attitudes towards the recession
- Consumer attitudes towards the recession, by nation
- Consumer attitude towards the economic downturn, by age
- Consumers continued to value their communications services as the UK moved out of recession
- Consumers are still most likely to cut spend on their mobile phone, although the proportion has decreased in comparison to 2009
- Consumers perceive that communications providers have responded to the recession with better deals
- Consumers continue to see a wider value in buying communications services in bundles
- Consumers agreement/disagreement that they were more likely to take communications services in a bundle
- Shopping online is viewed as an opportunity to save money, but consumers continue to prefer to make calls using their home telephone instead of over the internet
- Consumers agreement/disagreement that they were more likely to use price comparison websites in order to find the best deal
- Consumers agreement/disagreement that they make more telephone calls over the internet rather than using a home landline
- Consumers embrace HDTV in spite of the economic downturn
- The UKs communications market fast facts
- Availability of communications platforms and services
- Coverage of 2G and 3G mobile services in the UK
- Take-up of communications platforms and services across the UK
- Adoption of communications technology/service in urban and rural locations
- Mobile-only households in the UK
- Consumer take-up of bundled services in the UK
- Spending by public service broadcasters on television and radio content across the UKs nations
- Consumption of television and radio services by people in England
- Use of converged platforms and devices by people across the UK
TV and audiovisual content
- TV industry revenue down 0.4% to 11.1bn in 2009, as advertising is hit
- TV net advertising revenues
- Recorded viewing grew to 5.9% in 2009
- The growth in recorded viewing occurred on digital platforms
- Growth in time-shifted viewing was highest among younger viewers
- BBC HD was the most time-shifted channel
- The rise of catch-up TV
- Take-up of catch-up TV grew by a third, to 31% of internet users in Q1 2010
- Consumers are watching catch-up TV on a growing range of platforms
- BBC iPlayer remains the most popular online service, but others are increasing share
- iPlayer use almost doubled during the past year
- Non-linear viewing of audio-visual content is a small but growing component of all viewing
- Consumers watch an average of more than four hours of non-linear content per week
- DVR viewing
- HDTV now available on all digital television platforms, with HD-ready set sales passing 24 million during 2009
- The number of homes with access to HDTV channels passes five million
- The availability of HD content continues to grow
- Top 10 most-viewed programmes on BBC HD in 2009
- BSkyB launches the UKs first 3DTV channel
- 3D technology
- TVs get connected
- Games consoles as media hubs
- PSB portfolios share in multichannel homes
- PSB portfolios combined share
- Annual growth in share of the main PSBs and their portfolio channels
- Roll-out of digital switchover drives digital TV take-up
- Digital TV take-up is being driven in part by TV switchover
- TV set conversion
- More than 99% of TVs sold last year had DTT built in
- UK television industry generated revenue of 11.1bn in 2009
- Total TV industry revenue sources, by share
- The TV channel sectors revenues fell in 2009
- PSB portfolio channels experienced their first decline in advertising revenues during 2009
- TV net advertising revenue market shares
- Broadcasters raised less revenue from other/non-broadcast sources in 2009
- Revenue among key multichannel genres continued to grow in 2009
- Broadcasters spent marginally less on programmes in 2009
- Reductions in content spending
- Over 2.9 million hours of television broadcast in 2009, up 14% year on year
- Hours of first-run originated output on the five main channels fell by 8% in 2009
- Costs per hour of programming by broadcaster type
- Cost per hour for first-run originated content on five main PSB networks
- First-run originated content on PSB channels
- Genre mix on five main PSB channels in peak time
- Genre mix on five main PSB channels in daytime
- The BBCs digital channels genre mix
- Entertainment channels accounted for more than a quarter of multichannel hours in key genres
- Multichannel content spend up 7% in 2009 to pass 2bn
- Advertising now the main source of online television revenue
- On-demand film revenues remain a small part of the overall film market
- The UK television production sector
- PSBs in context
- Original production quotas
- Independents commanding a growing share of spending on originated content
- PSB independent and in-house productions
- PSB originations volume over the last ten years
- The independent sectors share of PSB spend has grown at a faster rate than its share of hours
- Share of daytime hours and spend
- Independent costs per hour rose 13% in peak time over the last decade converging with in-house levels
- Daytime costs per hour
- Independent productions command a majority share of main genres in peak time
- Peak time independent shares over the last ten years
- All day originations spend over the last ten years
- Independents more successful at delivering new series
- The diversification of independents revenue streams
- Television production outside London
- Independents command a lower share than in-house of out-of-London productions
- Availability of digital television platforms
- The move from London - MediaCityUK
- Digital TV passed the 90% threshold in 2009
- TV Platform shares
- TV Platform net additions
- Hours of TV consumption increased among older viewers but fell among younger viewers in 2009
- Reach of multichannels exceeds individual main PSB channels for the first time
- The TV audience is generally higher at weekends
- Patterns of viewing, by time of day and age
- Viewing patterns on weekends, by day part and by age
- Viewing shares of the five main PSB channels
- PSB channels share decline continued in 2009
- Main PSB channel combined shares by platform
- Five main PSB channels shares by platform
- The rise in PSB portfolio channel share fails to offset the decline in the main PSB share
- Broadcaster portfolio shares in multichannel homes, 2004 - 09
- BBC portfolio shares in multichannel homes
- ITV portfolio shares in multichannel homes
- Channel 4 portfolio shares in multichannel homes
- Five portfolio shares in multichannel homes
- Skys portfolio share grows for the first time in five years
- Combined UKTV share varies only marginally
- Entertainment channel genre dominates viewing
- Multichannel audience winners and losers, 2008 to 2009
- The most-viewed channels in multichannel homes remain the same year on year
- The 20 most-viewed programmes in 2009 were all on either BBC One or ITV1
- Platform and channel demographics
- Main PSB channels more likely to attract older and female viewers.
- Online TV and film sites continue to jostle for position
- Growth in time per person
- Virgin Media VoD continues to grow in both reach and frequency of use
- Video-sharing sites audience growth begins to slow
- Time spent on video-sharing sites
- Viewers and subscribers
- Tablets, e-readers and iPads
- E-book applications
- Consumer attitudes towards television
- Reasons given for opinion TV programme quality has deteriorated
- Use of channel and programme blocking facilities
Radio and audio content
- Key market developments in radio and audio
- Patterns of listening over digital platforms
- Over a third of adults now have access to DAB radio at home
- Seven percent of adults listen to podcasts every week
- Radio apps becoming more widely-used by mobile phone listeners
- Younger adults (aged 16-24) more likely to download audio content and use hand-held devices
- BBC Radios share of listening down but share of income up
- Local commercial sector listener hours up in 2009, as many other sectors fall
- Listener hours among youngest and oldest age groups rose in 2009, while 15-44s hours fell
- Department for Culture Media and Sport announces Digital Radio Action Plan, July 2010
- UK radio income down 4% to 1.1bn in 2009
- Expenditure on radio advertising down in 2009, but share of display market increases
- Commercial radio revenue per listener fell by 12.7% in 2009
- Audio content: popularity of digital formats growing as recorded music revenues begin to stabilise
- as digital continued to increase its overall share of revenues
- and the decline in volumes of album sales slows
- Download-to-own is driving much of the increase in digital music revenues
- and new business models continue to emerge
- Five commercial groups own half of all the UKs commercial radio licences
- Commercial groups and BBC share of listening
- Commercial groups weekly audience reach
- The BBCs radio services in 2009/10
- BBC network radio hours by genre
- BBC expenditure by station: BBC nations services have highest cost per listener hour in 2009/10
- Radio licences
- Community stations increasing, with 176 now on air
- Community radio licences awarded for South East of England
- DAB station choice
- Radio audience reaches new high in Q2 2010
- BBC stations attracted over half of all listener hours (54.6%) in Q2 2010 but commercial radio share was up on the year.
- Average time spent listening to radio increases with age
- Younger age groups (under-45s) spending less time on radio
- National radio stations hours rose in the last five years while local stations fall
- BBC Radio 1, 2, 4 and Five Live increase weekly audiences in Q2 2010
- Digital radio listening trends
- Listening to digital radio, by age group
- National stations benefit from increased exposure on digital formats
- BBC 6 Music leads increases in listening to digital-only stations
- Listening patterns vary across the UKs nations
- Location of radio listening
- DAB sets account for a fifth of all radio sales
- Well over 100 million active radio devices in UK homes and cars
- Attitudes towards, and awareness of, DAB digital radio services
- Likelihood to purchase a DAB set
- Satisfaction with radio services
- Satisfaction with radio content
- Audio and radio: importance of audio / radio activities to user
- Listening to audio on its own versus listening concurrent with other activities
- The number of people using online streaming services is small, though audiences to some are growing
- A year of online streaming services
- Online radio still accounts for the majority of audio internet use in the UK
- UK listeners now spend the same amount time using Spotify as iTunes
- A third of UK consumers now use an MP3 player/iPod, with personal use highest in Northern Ireland
Internet and online content
- Industry metrics and summary
- Social networking
- Over 60% of 15-34 year olds access social networking sites on the internet at home
- Facebook makes the largest contribution to the growing popularity of social networking
- Social networking now accounts for a quarter of all time spent online
- Facebook users spend more time social networking than users of other sites
- A fifth of 16-24s time spent social networking is on mobile devices
- Online and web-based advertising
- Online advertising expenditure continued to grow through the economic downturn
- Paid-for search now accounts for 6 of every 10 of online ad spend
- Mobile advertising shows signs of growth...
- ...although revenues remain small
- Introduction
- Internet take-up, by platform
- Two-thirds of households with fixed connections use a WiFi network
- Consumers are accessing the internet across more and more devices
- Nearly a quarter of adults use their mobile phones to access data services
- but some are not confident in using the web on their mobile
- The demographics of internet access
- Younger people are more likely to use the internet for leisure pursuits while older internet users tend to focus on functional activities
- Nearly nine in ten internet users feel confident online
- Internet audiences are highest around the Christmas period
- The online audience is maturing as internet take-up among older people rises faster than among other age groups
- Younger people make up a greater proportion of female internet users than of male internet users
- The active online universe shows a skew towards ABC1 users
- Internet users in Lancashire spend the most time using an internet-enabled computer
- Introduction
- Internet use and consumption
- Users aged 55+ are much more likely to use the internet for only a few activities
- Consumers are increasingly using the internet to shop and save money
- Online media content: playing games online is now as popular as downloading music and video
- Search and communities is the most popular category of website
- Google, Microsoft and Facebook are the most popular internet brands
- The same top ten sites are popular across all age groups, differing only in order
- Windows Live Messenger is the most popular internet application
- Googles image search saw its reach grow by a third over the past year
- Facebook is the most popular search term on Google
- Consumers hold a range of views on the accuracy and impartiality of search engine results and some are indifferent
- Mobile internet use
- Facebook accounts for 45% of total time spent using the mobile internet
- User-generated content
- Apart from photo sharing and social networking, most internet users have little interest in UGC
- User-generated content activities by age
- Audiences for many user-generated content sites continue to grow
- UGC sites
- Concerns about the internet
- Internet users are more likely than non-users to have concerns about the internet
Telecoms and networks
- Industry metrics and summary
- Revenues fell across the board
- Change in operator-reported telecoms retail revenues and use in 2009
- Voice and data operator-reported UK telecoms industry retail revenue
- The growing gap between data volumes and data revenues
- Mobile data use and data revenues
- UK IP traffic, 2009
- Broadband speeds increase, but the gap between actual and advertised speed grows
- driven by the upgrade of cable and roll-out of ADSL2+ services
- But the gap between headline and actual speeds is increasing
- ADSL2+ offers significant benefits only to those living less than 3km from the local exchange
- Super-fast broadband is available to many but take-up is very limited
- So, why such low current take-up?
- Mobile broadband take-up levels off
- Mobile broadband user groups
- Many consumers view the service as not for them
- Less than satisfied
- Use of mobile internet has doubled in the past two years
- Take-up of smartphones mirrors the take-up of mobile internet
- More than three-quarters of smartphone users access the internet on their phones
- iPhone and Android users are heaviest users of mobile internet
- Young people more likely to use the mobile internet but not necessarily on smartphones
- Type of handset used, by age
- Two-year contracts with handsets become standard
- Low cost SIM-only one-month contracts the most popular alternative choice
- The share of post-pay mobile connections continues to increase
- Industry overview
- Overall service revenues fall for the first time
- Fixed-line decline accelerates as mobile connections exceed 80 million
- 3G and DSL connections on the rise
- Mobile continues to take greater share of connections
- Mobile drives up overall voice telephony call volumes
- Local loop unbundling
- Growth in LLU lines slows to 16% during 2009
- Voice services
- Average access revenue per fixed line continues to rise
- Mobile voice revenues fail to keep pace with growth in mobile call volumes
- Revenue from voice and line rental falls by 6%
- Average voice revenue per connection fell by 10% in 2009
- Decline in fixed call volumes slows to 4.1%
- BTs share of fixed call volumes continues to fall
- BTs share of UK and international calls continues to fall
- Growth in mobile voice slows
- Pre-pay call minutes grow at faster rate than contract
- BTs share of fixed voice connections falls to below 60%
- Vodafone achieves highest increase in mobile connections in 2009
- T-Mobile/Orange merger Everything Everywhere
- Contract continues to increase share of mobile connections
- Data services
- Fixed-line broadband revenues
- Fixed-line broadband and internet revenues fall by 0.1bn
- Revenue from non-bundled SMS falls by 9% during 2009
- SMS use soars even higher
- Total internet connections increase by 50% over five years
- Fewer than a million households use dial-up internet
- LLU providers continue to gain market share
- 3G adoption accelerates
- Nearly eight million 3G connections added in 2009
- Despite increasing use of mobile services, business telecoms revenues fell by 4.2% in 2009
- Average monthly revenue per business fixed line fell by 0.71
- Business spend on mobile voice falls by 5.1%
- Mobile continues to drive overall growth in business voice volumes
- Call volumes per business fixed line fell by 4.5% during 2009
- The number of business fixed lines falls by 0.5 million
- ISDN
- More households have mobile connections than fixed connections
- Average household telecoms spend falls to 3% of total household spend
- The average person spends around half an hour a day surfing the web at home over a fixed internet connection
- Fixed and mobile voice services - take-up
- 15% of households did not have a landline in Q1 2010
- Over a quarter of DE households are mobile-only
- 17% of adults say that they currently use voice over internet protocol (VoIP) services
- 16-24 year-olds are the highest users of VoIP services in the home
- Average calls per person fall by 5% in 2009
- Growth in average mobile voice call use slows to 6% in 2009
- Average calls per contract and pre-pay mobile subscription both grow in 2009
- Cost of a basket of fixed voice calls is unchanged in 2009
- Cost of a basket of mobile services continues to decline, falling by 18% in 2009
- Average landline and mobile costs converging
- Average costs of pre-pay and contract call minutes decline in 2009
- Satisfaction with fixed-line services is unchanged
- Satisfaction with mobile telephony services remains high, at 94%
- Two per cent of households continue to use dial-up services
- Use of data services is higher than average among ABC1 households
- Broadband take-up highest among 35-54 year olds at 83%
- Six per cent of households used mobile and not fixed broadband in Q1 2010
- Older consumers embrace fixed broadband services as younger people switch to mobile broadband
- 29% of UK households did not have a broadband connection in Q1 2010
- Perceived lack of need for internet is the most-cited reason for not having it
- Six per cent of people only access the internet in a place other than home
- Almost half of internet use on a mobile handset is at home
- Many mobile users mainly use their mobiles for messaging and other data services
- PC / laptop internet use grows by 15% in the year to May 2010
- The average mobile user spends an hour accessing the internet on their handset
- Average cost of a residential fixed broadband connection falls by 2% in 2009
- Wide variety of tariffs available, with savings for those who bundle services
- Mobile broadband services available for less than 10 a month
- Ninety per cent of consumers are satisfied with their fixed broadband service
- Consumers not as satisfied with mobile broadband services as with fixed
- Switching levels unchanged for all services
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