Broadband prices hit all-time low

 

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Posted on 4 Feb 2008 at 11:12

Average broadband prices have dropped by more than a third over the past four years, while headline speeds are faster than ever, according to a new uSwitch survey. But don't expect them to fall further.

The price comparison website found that the UK's 15 million broadband households are paying 36% less then they were four years ago, while headline connection speeds are up to 16 times faster - although actual speeds are often far slower than stated.

While prices have fallen sharply across the board, there are still huge variations. PlusNet will sell you an 8Mb/sec connection for £10; Orange (previously Wanadoo and before that Freeserve) wants twice that. Quite how uSwitch reaches its conclusion that Orange's service is the most expensive of its kind is not clear, as some ISPs offer 8Mb/sec services well in excess of £20. uSwitch did not reply to a request for clarification.

Instead, uSwitch says that broadband subscribers should no be paying more than £20 for standalone 8Mb/sec connections, those that don't include VoIP or other additional services, while the average is £17. It estimates that five million households are paying more than the going rate for their broadband, wasting £162 million a year.

Steve Weller, head of communications services, at uSwitch.com, believes prices may not fall much further and that now is the time to take advantage.

"We predict that prices will stabilise, but customers will be offered more for their money, with companies continuing to increase speeds," he says. "Be offers broadband packages with speeds up to 24Mb/sec for a monthly cost of £18, only 81p more expensive than the average price of 8Mb broadband. We advise the three million customers currently not in a contract to kick start 2008 by snapping up a new broadband deal."

It is certainly the case that the uniquely competitive UK broadband market has seen prices tumble and ensured that the barriers to access are lower than in almost any other country.

But while uSwitch talks of 8Mb/sec services, the reality is a widening disparity in broadband speeds between households in urban areas, where services are faster, and those further afield where speeds soon drop off as the distance from the telephone exchange increases. This is particularly true of ADSL2+ services that provide headine speeds of 24Mbps, but most users will achieve nothing of the sort.

That, uSwitch says, should be the first consideration when choosing a service. "Be aware that the 'up to xMb' speed offered by suppliers is the maximum connection speed the provider offers. Actual speeds experienced may be significantly lower due to factors such as the quality and length of the physical line from the exchange to the customer's premises."

Another issue to consider is the application of "fair usage" limits. A 10Mb+ connection is neutered if the ISP places restrictions on the amount of content that can be downloaded at peak times. As uSwitch says, check the small print.

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Author: Simon Aughton