Ofcom: UK is nation of early adopters and online spenders

Britons are a nation of early technology adopters who have embraced smartphones and the mobile internet more rapidly than other nations and spend more online than any other European country, according to new research from the media regulator Ofcom.

The UK saw the fastest growth in smartphone take-up in the past year among European countries, with a 70% rise in subscriber numbers between January 2009 and January this year, according to the watchdog's fifth International Communications Market Report 2010.

The study (which is available in full from Ofcom) analysed the availability and usage of landlines, broadband, mobile phones, TV and radio in 17 countries. Generally, it found a long-term trend across the seven main countries studied – the UK, US, Germany, France, Japan, Italy and Spain – where there are fewer fixed-line connections for voice calls (but a growing number of "naked" phone lines that only offer broadband) and more mobile connections, pointing towards a future when people access the internet and phone services wirelessly all the time.

Italy has the highest take-up of smartphones overall among European countries, with 26 subscribers per 100 people, followed by Spain at 21% and the UK 18%.

But the UK also experienced significantly faster growth in high-value subscribers – those more likely to use premium handsets with expensive subscription plans, such as the iPhone – than any other European country, where there was 61% growth in the number of users, compared to Spain which saw just 4% growth – indicating that the UK leapfrogged other countries.

British consumers also use their mobile phones for social networking more than in other countries – 24% for the UK, compared to 13% in Germany.

Among other major findings of the study are:
most households among the six countries now have fixed-line broadband and digital TV, at 70% and 91% in the UK
take-up of superfast broadband in the UK lags seriously behind many other countries, with only 0.2% of households having speeds above 30 megabits per second, compared to a few per cent in most other countries, and 5% in the Netherlands, 7% in the US, 12% in Sweden and 34% in Japan
the UK also lags in the provision of superfast mobile networks using a technology called "LTE" (long-term evolution), nowhere having LTE – compared to Sweden, which already has 100% coverage
UK users are more likely to use a laptop than a desktop computer (69% v 58%) than any of the six countries, and the next most likely after the Japanese to go online using a mobile phone (29%).
Britons make double the number of online purchases (19) in the past six months than any other major European country, apart from Poland (14).
Britons spend almost twice as much online per head than any other country (£1,031); the next biggest is France (£595).

Ofcom also found that the UK has some of the cheapest communications in the world, and that revenues from communications services, including radio, TV, fixed broadband, mobile voice and data, and fixed voice lines per person fell in the UK – and every other country except France – in 2009.

In social networking:
younger people in the UK are also more likely to visit social networking sites on their mobiles compared with other nations, with 45% of 18-24s and 38% of 25-34s saying they did this. The number of social networkers among 18 to 24-year-olds and 55 to 64-year-olds is also higher in Britain than other countries, with 86% of UK 18-24s saying they use the internet for social networking, compared to 77% in France and 48% in Japan.
approximately 45% of UK 55-64s said they use the internet for social networking compared to 30% in Germany and 13% in Japan.

In advertising:
the UK has a bigger share of advertising spend online than any other of the countries studied, and that has grew from 2008 to 2009, reaching 27%; none other of the major seven countries was above 20%.

In TV:
the UK and Spain led the way on digital TV take-up (91%) as the digital switchover is implemented.
British consumers are ahead of the rest of the world in take-up of HD ready TV sets – 59% of UK households compared to 57% in the US – but take-up of HDTV services is lower in the UK than in other countries, where take-up is linked to the amount of HDTV channels available. James Thickett, Ofcom's director of market research, suggested this is because HD channels have so far been paid-for on Sky or cable services such as Virgin. "The advent of Freeview HD in the past year means those numbers have already gone up," he said.
TV viewing has not fallen, despite the internet: British TV viewers watched 225 minutes per day, unchanged per day, and more than the six-country average of 207 minutes per day. The US (280), Italy (238) and Spain (226) watch more.
internet TV channels ("IPTV") has barely been adopted in the UK, where only 0.3% of households use it; the number is at least 10 times greater in the other six main countries, and notably high in France at 18%. Thickett ascribes this to the ability to get cheap high-speed broadband in France, and its Minitel heritage.
the UK had the second highest number of homes behind America with pay TV DVRs (such as Sky+ and V+) at the end of 2009 with 7.8m devices – up by 40% on 2008.
Approximately 24% of British internet users accessed online television services such as iPlayer on a weekly basis.

In digital radio:
digital radio take-up in the UK was the highest among the countries Ofcom surveyed with almost a third (31%) claiming to own and use a digital radio.

Ofcom's Thickett said: "The internet is changing people's habits, not just in social networking, they are using the internet as a way of transacting. UK consumers are making more purchases and shopping on the internet more than any other country."

He put this down to the high proportion of Britons with credit cards, the country's tradition of buying from catalogues and the early impact of the arrival of US internet retailers such as Amazon, which set up its UK website in 1998. Other US internet companies have frequently used the UK as a bridgehead to the wider European market.

Despite the recession, people were less likely to cut down on communications services, in particular broadband (6-7%), than they were on nights out (39-56%) or holidays (29-51%).

Asked to forecast how the UK would look in two years' time, Thickett suggested that there would soon be more fast fixed-line broadband: "commitments from BT and others should mean that two-thirds of homes will have superfast broadband by 2015. And next-generation LTE mobile broadband will catch up where we're presently behind. We're going to see both those coming down the track, which will change the communications landscape."

He said it was surprising how relevant TV has remained: "TV has been remarkably resilient. In many countries viewing has actually increased which we put down to the fact that TV has reinvented itself with DVRs and IPTV, and widescreen and bigger sets. The viewing experience means people are watching more."

Thickett thinks that "TV is well placed to go into the next generation of IP [internet protocol] technology. There was a period about five years ago when TV was fragmenting, where people watched it in different rooms – but now we're seeing a trend back into the living room, driven by the DVR but also by shows such as The X Factor."