§ The Earl of Northeskasked Her Majesty's Government:
Whether they concur with the view expressed by David Edmonds, director general of Oftel, that the United Kingdom has the most competitive broadband market in the world (Trade and Industry Select Committee, 4 February 2003); and, if so, on what criteria their assessment is based. [HL1838]
§ The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville)The UK online annual report 2002 contained the most recent assessment that the Government have 113WA made. This assessment was that at end August 2002 we were fourth in the G7 for competitiveness. The metrics used were developed with the broadband stakeholder group and include indicators of price, choice and the regulatory environment.
The assessment of competition in a market is a complex judgment. But by many measures, the UK is among the most competitive broadband markets in the world. As David Edmonds said, there are over 100 service providers using BT's wholesale products to provide services to consumers. In doing so, they face fierce competition from the cable companies. As a result, BT faces much more competition than incumbent operators in other major markets. Whereas BT's share of the retail broadband market is just over 20 per cent, Deutsche Telekom, France Telecom and Telecom Italia have 90 per cent, 80 per cent and 75 per cent of the German, French and Italian retail markets respectively.
In terms of price, Oftel's latest benchmarking report (December 2002) showed that prices for residential customers in the UK were similar to prices in the US and Germany and cheaper than in France. Only in Sweden were prices lower than in the UK. For basic business services, the UK was cheaper than all the other countries considered.