The market in context

Text-based communications are surpassing traditional phone calls or meeting face to face as the most frequent ways of keeping in touch for UK adults

The findings were revealed when adults were asked what methods they used at least once a day to communicate with friends and family.

The average UK consumer now sends 50 texts per week which has more doubled in four years with over 150 billion text messages sent in 2011.

Almost another ninety minutes per week is spent accessing social networking sites and e-mail, or using a mobile to access the internet, while for the first time ever time spent on calls on both fixed and mobile phones has declined.

Ofcom's Communications Market Report 2012 shows that traditional forms of communications are declining in popularity, with the overall time spent talking on the phone falling by 5% in 2011.
This reflects a 10% fall in the volume of calls from landlines, and for the first time ever, a fall in the volume of mobile calls (by just over 1%) in 2011.

Teenagers and young adults are leading these changes in communication habits, increasingly socialising with friends and family online and through text messages despite saying they prefer to talk face to face.

These changes also reflect the rapid increase in ownership of internet connected devices, such as tablets and smartphones.

Tablet ownership has jumped from 2% to 11% in 12 months, while one in ten UK adults now has an e-reader.

Two fifths of UK adults now own a smartphone, with the same proportion saying their phone is the most important device for accessing the internet.

Smartphones are also affecting people's shopping habits, encouraging online bargain hunting or Robo (Research offline buy online) shopping with over half of smartphone users claiming to use their phone in some way when out shopping. 

Internet connected 'smart TVs' are also growing in popularity with 5% of UK households now owning one, giving consumers the ability to 'Turf' - both watch TV and surf the web .

The report reveals that UK households now own on average three different types of internet-enabled device such as a laptop, smartphone or internet-enabled games console with 15% owning six or more devices.

James Thickett, Ofcom's Director of Research, said: 'Our research reveals that in just a few short years, new technology has fundamentally changed the way that we communicate. Talking face to face or on the phone are no longer the most common ways for us to interact with each other.

'In their place, newer forms of communications are emerging which don't require us to talk to each other especially among younger age groups. This trend is set to continue as technology advances and we move further into the digital age.'

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 Internet use and attitudes: 2012 Metrics Bulletin

 Rise in Text Based Communications - survey data tables (PDF & CSV Zip file)

Broadband take-up in Scotland has risen faster than any other UK nation over the last year, jumping 7 percentage points over 2011.

Sixty-eight per cent of homes in Scotland now have broadband, up from 61% a year earlier.

The rise was driven by increased take-up of both fixed broadband (57% to 64%) and mobile broadband (9% to 12%) between the start of 2011 and 2012.

In last years report, Scotlands broadband take-up was 13 percentage points lower than the UK average of 74% and the lowest of all the UK nations.

This year it is 8 percentage points lower than the UK average of 76%, on a par with Wales and Northern Ireland.

Scottish consumers are also much more satisfied with the speed of their fixed broadband service, with satisfaction levels rising by 12 percentage points to 85%. This returns satisfaction levels to what they were in 2009.

There is evidence of more home grown TV productions being made in Scotland

First-run productions by the five main PSB channels accounted for 4.9% of expenditure of originated network programming, up from 4.6% in 2010.

Producers in Scotland delivered 6.8% of all first-run originated network hours on the five main PSB channels in 2011, up from 4.6% in 2010.

However, year on year, spend by public service broadcasters on first-run originated programming for viewers in Scotland was down 2% to 53m.

For the first time, Ofcom reports on the postal market following its new responsibilities under the Postal Services Act 2011.

In Scotland, fewer consumers (51%) claim to send items of post regularly than the UK average of 58%.

Forty per cent of adults agree that they prefer to send e-mails rather than letters whenever possible, slightly higher than the UK average (38%) and a much higher than in Wales (27%) and Northern Ireland (30%).

Vicki Nash, Director of Ofcom Scotland, said: Last years report found there was a risk of Scotland being left behind in terms of broadband take-up.

'This year the picture is much healthier with Scotland closing the gap on the other nations'

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  Annex A: Adults' media literacy in the nations

Wales is a nation of fast adopters when it comes to new gadgets such as smartphones and e-readers.

More than two-fifths (39%) of Welsh adults are now smartphone users, up from only a quarter (25%) in 2011.

Younger age groups (16-24s and 25-34s) and more affluent households are most likely to own the devices.

At the same time, there has been a 56% jump in the number of people accessing the internet using their mobiles

Wales also has the highest adoption of e-readers in the UK.

More than one in eight (13%) adults in Wales had an e-reader in the first quarter of 2012, compared with the UK average of 10%.

During the course of 2011, broadband take-up in Wales remained stable at 68%, but differences by area and demographic still exist.

Take-up is lower among older households and homes in less affluent areas.

For example, around 63% of adults in the South Wales Valleys have fixed home broadband, compared to 78% of adults in Cardiff.

Two in three (66%) adults in Wales say they would spend less on a communications service if they were forced to make cuts in spending, compared to around half of UK adults (52%).

When forced to choose which communications service they would cut back on, people in Wales are more likely to select pay-TV services (28%) compared to UK adults overall (16%).

Elinor Williams, Ofcoms Director for Wales, said: It is encouraging to see that last years rise in broadband take-up in Wales has been sustained and that Welsh consumers are continuing to take advantage of the communications services which are available to them.

'This year's report shows that more and more consumers are using social networking and accessing the internet on mobile devices such as smartphones and tablet computers, a trend which appears set to continue with the future introduction of 4G services.

'As the UK enters a new generation of mobile communications, Ofcoms objective is to promote effective competition and to stimulate both investment and innovation - helping to serve many areas of the UK that have traditionally been underserved.'  

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  Annex A: Adults' media literacy in the nations

Northern Ireland has the highest availability of superfast broadband in the UK.

These services are available to around 94% of premises compared to 60% for the UK as a whole.

Consumers in Northern Ireland are also becoming increasingly technology savvy.

Some 34% of adults in Northern Ireland now own a smartphone - a 62% increase in the past year and there has been a fourfold rise in the proportion of people who own a tablet computer (9% of homes in Northern Ireland had a tablet in the first quarter of 2012).

This is having a significant impact on consumers lives in Northern Ireland, with nearly three quarters of broadband users shopping online and two thirds social networking with friends and family.

Over one third (35%) of adults in Northern Ireland are also accessing the internet with their mobile phones.

Jonathan Rose, Ofcoms Northern Ireland Director, said: There are some striking figures in this report as highlighted by the availability of superfast broadband services.

'Significant investment by the Executive and the telecoms companies has put Northern Ireland in an enviable position and provides significant opportunities for consumers and businesses.'

This years report contains specially commissioned research on the impact of inadvertent roaming on mobile users living and working in border areas of Northern Ireland.

In the worst affected area (South Armagh / South Down), almost a third (30%) of people say that they experience inadvertent roaming on a daily basis.

Ofcom estimates that this can cost consumers up to an estimated 300 in additional charges per year.

Jonathan Rose added: 'While the European Commission has lowered the maximum roaming rates that operators can charge, our research shows that the problem of inadvertent roaming continues to be costly for tens of thousands of consumers in Northern Ireland.

'The latest European Roaming Regulation places a responsibility on mobile operators to take 'reasonable steps' to protect their customers from inadvertent roaming charges.

'We are writing to the operators to find out what actions they are planning to take to meet this new obligation.'

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  Annex A: Adults' media literacy in the nations

 Annex B: Financial impact of inadvertent roaming in Northern Ireland: methodology

This year there have been trials of superfast broadband in many areas, including Cornwall and London. BT and Virgin continue with the roll-out of fibre-optic services around the country, to bring much faster services to consumers. Next-generation broadband services began trials during the year and promise even faster connections in some areas.

Many companies are now undertaking trials and launching innovations which will bring rural areas to the forefront of technological advances in the coming years, such as the initiatives in Devon and Cumbria.

The widespread adoption of smartphones and the emergence of tablet computers have increased demand for data across cellular networks. Mobile network operators are exploring technologies that will enable faster connections with greater capacity. Ofcom will auction spectrum for 4G later this year, but some operators are already proposing trials of 4G services using their existing spectrum.

In many areas of the UK the creative industries are developing new hubs for innovation, such as in Old Street in London, and have announced funding to help new filmmakers.

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Global communications sector revenues the total of the telecoms, TV, post and radio sectors - grew in 2011 by 3.7%, reaching £1,322bn. Telecoms sectors generated the largest absolute rise in revenues in 2011, up by £31bn to £936bn. In terms of percentage growth, television revenues grew fastest among the communications industries, by 6.6% in 2011 to £258bn.

Global advertising expenditure grew by 3.8% in 2011 to £298bn, the highest total spend since 2007. While expenditure on internet advertising grew at a compound annual rate of 16.0% between 2007 and 2011, to £48bn, the compound annual growth rate of newspaper advertising was -6.9% falling to £60bn, while for magazines it was -6.8%, falling to £28bn.

In the television and radio sectors, subscriptions generated the largest and fastest-growing proportion of total revenues in 2011. Television subscription revenues grew by 10.5% in 2011 to £133bn and at a compound annual rate of 9.0% between 2007 and 2011. Radio subscription revenues grew by 12.5% in 2011 to £2bn and at a compound annual rate of 8.5% between 2007 and 2011.

The number of fixed-line voice connections remains relatively resilient in the UK, with more fixed-line voice connections per 100 people than in the other markets covered. Although this number fell between 2006 and 2011 in all of the countries which we surveyed, the fall in the UK was among the smallest. Tablet take-up is highest in Spain and Australia (it is 24% in both). Italy and the US have the next-highest claimed ownership (23% and 20%) while in the UK take-up is 19%.

In nearly all comparator countries, consumers say they have reduced face-to-face communication and fixed telephone calls with friends and family. In all eight countries, use of post declined. In contrast, preferences for online communications increased, particularly in the UK and Italy, which showed large increases in the use of email and social networking.

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