Feeds

Goldilocks time for retail broadband

Too big, too small, just right?

Next gen security for virtualised datacentres

Analysis There are two main problems facing the retail broadband market: it isn't great to be small, unless you are really small, and it isn't easy to be big, unless you are really big.

For example: Pipex spent £24m expanding its customer base last week. Its acquisition of Bulldog's customers and the Toucan service make it the sixth largest retail broadband player in the UK. But will this be enough to make it a serious challenger to BT Retail, NTL, and the like?

Ovum senior analyst Mark Main is unconvinced. At the extremes of the market, things are not looking too bad. Very small firms, such as Merula, he suggests, might pull through by becoming real specialists. Although it won't be easy, he says these smaller players will survive if they are cautious and work on establishing good reputations with SMEs in their local areas.

Very big firms are also well positioned. As ever, deep pockets and recognisable brands will be very useful, and these firms have the marketing budgets to see off the competition.

The middle-sized companies, that is the lower half of the top 10, are in for a really bumpy ride.

"The middle of the market is a very, very difficult place to be. Pipex's acquisitions leave it in sixth place, but still some way behind BT et al. So what does it do now?

"Does it continue on the acquisition trail? That is probably the only way it can go," he told us.

But, when medium-sized providers try to get big, fast, it can go horribly and very publicly wrong, as Bulldog and Plusnet have learned in recent months. Orange has also suffered some teething problems, so even the bigger brands aren't immune.

For the last year or so, the important thing has been to grab territory, and waving big bandwidth numbers around has been a reliable way of attracting subscribers.

Main suggests that this preoccupation with big numbers, coupled with a failure to explain the physical limits of the technology to customers, has caused some ISPs to come unstuck. These sorts of teething problems should start to come to an end soon, though, he adds.

As Vodafone announces its arrival in the market, the focus on the land grab is starting to shift, as companies try to differentiate themselves with double, triple and even quadruple play options.

"It is a very interesting time in the broadband sector right now," he concludes. "We've not seen much in the way of different services from many players yet. Pipex has some options with mobile broadband, but then the cellular players can do that too. It is hard to see who is going to win out." ®

Boost IT visibility and business value

More from The Register

next story
Canadian ISP Shaw falls over with 'routing' sickness
How sure are you of cloud computing now?
Don't call it throttling: Ericsson 'priority' tech gives users their own slice of spectrum
Actually it's a nifty trick - at least you'll pay for what you get
Three floats Jolla in Hong Kong: Says Sailfish is '3rd option'
Network throws hat into ring with Linux-powered handsets
Fifteen zero days found in hacker router comp romp
Four routers rooted in SOHOpelessly Broken challenge
New Sprint CEO says he will lower axe on staff – but prices come first
'Very disruptive' new rates to be revealed next week
PwC says US biz lagging in Internet of Things
Grass is greener in Asia, say the sensors
Ofcom sees RISE OF THE MACHINE-to-machine cell comms
Study spots 9% growth in IoT m2m mobile data connections
O2 vs Vodafone: Mobe firms grab for GCHQ, gov.uk security badge
No, the spooks love US best, say rival firms
Ancient pager tech SMS: It works, it's fab, but wow, get a load of that incoming SPAM
Networks' main issue: they don't know how it works, says expert
Trans-Pacific: Google spaffs cash on FAST undersea packet-flinging
One of 6 backers for new 60 Tbps cable to hook US to Japan
prev story

Whitepapers

Endpoint data privacy in the cloud is easier than you think
Innovations in encryption and storage resolve issues of data privacy and key requirements for companies to look for in a solution.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Solving today's distributed Big Data backup challenges
Enable IT efficiency and allow a firm to access and reuse corporate information for competitive advantage, ultimately changing business outcomes.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.