Ofcom UK CMR 2008 Charts

Communications Market Report 2008

August 2008

1.1 Key market trends

Section 1: The market in context

3

Digital communications service availability, 2006 and 2007UK-wide

Platform 2007 2006 Change England Scotland Wales N Ireland

Fixed line 100% 100% 0% 100% 100% 100% 100%

2G mobile1 100% 100% 0% 100% 99% 98% 100%

3G mobile2 90% 70% 20% 95% 72% 68% 44%

DSL3 99.6% 99.6% 0.0% n/a n/a n/a n/a

Cable broadband4 49% 49% 0% 52% 38% 24% 30%

LLU5 80% 67% 14% 84% 67% 64% 51%

IPTV6 15% 15% 0% n/a n/a n/a n/a

Digital satellite TV 98% 98% 0% n/a n/a n/a n/a

Digital terrestrial TV7 73% 73% 0% 73% 82% 57% 58%

DAB digital radio8 90% 88% 2% n/a n/a n/a n/a

Sources: Ofcom and:1. Proportion of population living in postal districts where at least one operator reports at least 75% 2G area coverage. Sourced from GSM Association / Europa Technologies2. Proportion of population living in postal districts where at least one operator reports at least 75% 3G area coverage. Sourced from GSM Association / Europa Technologies3. Proportion of premises able to receive DSL services based on data reported by BT4. Proportion of households passed by Virgin Media’s broadband-enabled network5. Proportion of households connected to an LLU-enabled exchange6. IPTV availability figure calculated on the assumption that Tiscali TV is now available in London, Stevenage, Birmingham, Newcastle and Edinburgh7. Availability of services from all six digital multiplexes8. DAB digital radio coverage figure based on a Digital One estimate. Both the BBC and Digital One built new transmission masts during 2006/07

Figure 1.1

4

Early adopters

Early majority

0

25

50

75

100

Pro

port

ion

of in

divi

dual

s (p

er c

ent)

Figure 1.2

Source: Ofcom research and operator dataNotes: All figures relate to the end of Q1 2008; all figures are measured as a proportion of individuals except for 3G, which represents the proportion of mobile subscribers, LLU which represents the proportion of premises and DTV, which represents the proportion of homes with a digital television reception device on the main set.

Digital technology adoption, Q1 2007 and Q1 2008

Innovators Late majority

Late adopters

Digital TV 87%

Mobile 86%

DAB digital radio 27%

Fixed line 88%

DVR 23%LLU

16%

Broadband 58%

3G 17%

HDTV subscription

4%

HDTV set 33%

Mobile broadband

6%

MP3 player 45%

Q1 2008

Q1 2007

5

Figure 1.3

Source: Ofcom / operators Note: Includes licence fee allocation for radio and TV

Communications industry revenue

33.0 34.7 36.1 36.3 37.3 38.8

8.9 9.3 10.1 10.6 10.8 11.21.1 1.1 1.2 1.2 1.1 1.243.0 45.2 47.4 48.1 49.2 51.2

0

20

40

60

2002 2003 2004 2005 2006 2007

Rev

enue

(£b

n)

Radio

TV

Telecoms

5 year CAGR

1.7%

4.8%

3.3%

1 year growth

2.6%

3.8%

4.1%

6

Figure 1.4

Source: Ofcom / operators

Household spend on communications services

32.05 30.15 28.10 25.58 24.03 22.56

25.04 29.55 33.00 33.65 32.58 32.73

5.72 7.07 8.49 8.85 9.87 9.4524.23 25.44 26.10 26.85 26.47 26.682.32 2.28 2.25 2.26 2.21 2.21

£89.36 £94.49 £97.94 £97.19 £95.16 £93.63

4.35%4.61% 4.77% 4.72% 4.71% 4.78%

0

50

100

150

2002 2003 2004 2005 2006 2007

£ pe

r m

onth

(20

07 p

rices

)

0%

2%

4%

6%

As

% o

f to

tal s

pend

Radio

TV

Internet &broadband

Mobile voice& text

Fixed voice

As a %ageof totalhouseholdspend

7

Figure 1.5

Source: Ofcom / BARB / RAJAR / Neilsen NetratingsNote: The TV figure is for 2003 rather than 2002 to avoid the effects of changes in the BARB panel composition. Daily figures were calculated from monthly data on the assumption that there are 30.4 days in the average month; the exception was for internet consumption where the quoted figures relate to May 2002 and May 2007, and the number of days in those months were used. The internet consumption figures exclude the use of online applications such as streaming media; mobile telephony figures are estimated assuming that the average time taken to send and receive a text message is 35 seconds.

Time spent using communications services

224

173

6 15 5

218

164

24 14 10

0

50

100

150

200

250

Television Radio Internet Fixed telephony Mobiletelephony

Min

utes

per

per

son

per

day

2002

2007

% growth 2002-2007

-3% -5% 295% -7% 88%

8

Figure 1.6

Source: Ofcom research, Q4 2006 for fixed, mobile and DTV, Q1 2007 for broadband, Jan 2008Note: Shows the proportion of users with each service, includes only those who expressed an opinion.

Overall satisfaction with communications services

4132 40

5940

55 47 54

5156

5235

5034 42 36

92 88 92 94 90 89 89 90

0

20

40

60

80

100

Q42006

Q12008

Q42006

Q12008

Q12007

Q12008

Q42006

Q12008

Pro

port

ion

of u

sers

(pe

r ce

nt)

Satisfied

Verysatisfied

Fixed telephony

Mobile telephony

Digital TVBroadband

1.2: Communications and the environment

10

Figure 1.7

16

17

38

55

14

15

21

10

6

2

4

2

0% 20% 40% 60% 80% 100%

"When buying white goods, e.g. washingmachines, I try to compare them on how

environmentally friendly they are"

"I care about environmental issues and take theminto account in my personal life"

Agree strongly

Agree

Neither

Disagree

Disagreestrongly

Don't know

Source: Ofcom energy consumption survey, June 2008Base: All adults

Agreement with statements on environmental issues

11

Agreement with statements on environment and energy saving

3

4

8

11

24

27

21

23

27

31

36

42

39

53

10

16

16

11

9

8

6

41

33

33

31

19

21

13

18

11

11

9

5

4

5

5

8

2

2

1

1

2

0 20 40 60 80 100

"I know how much it roughly costs to run each of mydevices"

"It is easy to compare devices on the amount of energythey use"

"When buying new devices, I try to compare them onhow environmentally friendly they are"

"I don't really think about running costs when I purchasenew devices"

"I always turn my devices off as this is better for theenvironment"

"I always turn my devices/equipment off completelywhen not in use as this saves money"

"I know how to dispose of my devices in anenvironmentally friendly way"

Agreestrongly

Agree

Neither

Disagree

Disagreestrongly

Don't know

Source: Ofcom energy consumption survey, June 2008Base: All adults Note: ‘Devices’ refers to home entertainment and communications devices

Figure 1.8

12

Source: Ofcom energy consumption survey, June 2008 Base: All adults

18%

25%

7%

10%

6%

19%

29%

0% 5% 10% 15% 20% 25% 30%

Don't know

Nothing

Other

Information included in adverts stating average powerconsumption when device is on and in stand-by

Consumer awareness campaigns

Better information on the environmental impact of running thedevice

Better understanding of the costs of running the device

What would encourage consideration of power consumption when making a purchase?

Figure 1.9

13

Source: Ofcom energy consumption survey, June 2008, prompted Note: Consumers were asked about their awareness of the above labels, but the labels themselves were not shown to the consumersBase: All adults

50%

6%

11%

17%

18%

19%

0% 20% 40% 60%

None of these

Don't know

Other energy saving label

Energy Star label

Energy Savings Trustrecommended label

EU Eco label (EU flowerlabel)

Awareness of ‘eco’ labels

Figure 1.10

14

Level of power consumption of household devices 2006-2008

7%

47%

10%

37%

0%

10%

20%

30%

40%

50%

Increased Decreased Stayed about the same Don't know

Source: Ofcom energy consumption survey, June 2008 Base: All adultsNote: ‘Device’s refers to home entertainment and communications devices

Figure 1.11

15

Figure 1.12

33%

13%

54%

0%

20%

40%

60%

Quantity/number of devices hasincreased

Use of devices has increased Other

Source: Ofcom energy consumption survey, June 2008 Base: All adults with increased consumption of household/entertainment devicesNote: ‘Device’s refers to home entertainment and communications devices

Reason for increase in the level of power consumption

16


Which devices use the more energy?

25%

37%

8%

31% TV and separatedigital set-top box

TV with built-indigital receiver

They use the same

Unsure

Figure 1.13

17

Power consumption of average and ‘best practice’ devices

Televisions On power demand (W) Standby power demand (W)

CRT primary TV 122.91 2.60

CRT primary TV best practice 82.00 0.30

Plasma primary TV 340.00 4.00

Plasma primary TV – best practice 197.00 0.27

LCD TV primary 143.00 2.70

LCD TV primary – best practice 72.00 0.25

Set-top boxes (+ PVRs where applicable) On power demand (W) Standby power demand (W)

Cable Set-top box 16.60 15.20

Set-top box – best practice 10.80 9.50

Satellite Set-top box 17.97 16.79


PVR 24.00 12.30

PVR – best practice 15.00 10.80

Terrestrial Set-top box 7.10 6.40


Source: Market Transformation Programme, ‘What If’ tool: http://whatif.mtprog.com/Default.aspxNote: ‘Devices’ refers to home entertainment and communications devices; PVR (personal video recorder), also known as DVR (digital video recorder) and DTR (digital television recorder)

Figure 1.14

18

Frequency of switching off a device

Source: Ofcom energy consumption survey, June 2008 Base: All adults who own each device Note: ‘Devices’ refers to home entertainment and communications devices

7%21%

12%23% 22% 21% 22%10%

26%

15%

32% 29% 29% 30%

13%

30%

23%

18% 26% 23% 23%

7%

10%

8%

7% 9% 7% 10%

63%

12%

43%

19% 14% 19% 14%

0%

20%

40%

60%

80%

100%

Switchedoff wireless

router

Switchedoff TV

Switchedoff set-top

box

Switchedoff

DVD/videorecorded

Switchedoff desktop

Switchedoff monitor

Switchedoff laptop

Never

Not very often

Some of the time

Most of the time

Always

Figure 1.15

19

10%

30%

14%

5%

16%

10%

8%

16%

18%

8% 10%

12%

58%

18%

36%

11%

11%

11%

0%

20%

40%

60%

80%

Leave charger pluggedin and turned on without

phone

Charge phone for 2-3hours, then unplug

Charge phone overnight

Always

Most of the time

Some of the time

Not very often

Never

Do not have

Main methods of charging mobile phone


} }}23%

42%

46%

Figure 1.16

20

16

41

199 8 10 6

11

21

17

9 12 3 4

20

18

24

25 1821

9

13

9

5

1714

13

18

41

10

35 3947 52

63

0%

20%

40%

60%

80%

100%

All 16-24 25-34 35-44 45-54 55-64 65+

Pro

port

ion

of m

obile

use

rs (

%) Never

Not veryoften

Some of thetime

Most of thetime

Always

Source: Ofcom energy consumption survey, June 2008 Base: All adults using a mobile phone

Figure 1.17

Proportion who charge their phone overnight, by age

21

Source: Energy consumption survey 2008 Base: All adults who have disposed of devices in the last 12 months

5%

3%

4%

4%

7%

7%

8%

9%

14%

14%

43%

0% 20% 40% 60%

Other

Collected by the retailer from whom the device was purchased

Part-exchange/collected by the retailer of the replacement device

Dustbin

Dispose of with general refuse in local dump

Sold as a second-hand item (i.e. on eBay)

Collected by local council

Sent to a not-for-profit organisation

Left in storage somewhere in home

Given to someone else as a hand-me-down

Disposed of in special recycling area in local dump

Figure 1.18

Ways consumers dispose of devices they no longer use

22

Source: Ofcom Energy consumption survey 2008 Base: All adultsNote: ‘Devices’ refers to home entertainment and communications devices

Awareness of retail outlet’s obligation to take back old devices

Yes: 30%

No: 70%

Figure 1.19

1.3: Use of communications services by older consumers

24

Figure 1.20

88 8672 67

58

8499

62

41 3727

75

100

51

28 2215

69

0

20

40

60

80

100

Fixedtelephony

Mobiletelephony*

PC Internet Broadband Digital TV

Pro

port

ion

of h

ouse

hold

s (p

er c

ent)

All adults

Adults 65+

Adults 75+

Source: Ofcom research, Q1 2008Note: *Data for mobile penetration refer to the proportion of people who personally use a mobile phone

Take-up of communications services, by age

25

6 4 7

22

1

158 10

19

3327

-3

-10

0

10

20

30

40

Fixedtelephony

Mobiletelephony*

PC Internet Broadband Digital TV

Per

cent

age

poin

ts All adults

Adults 65+

Figure 1.21

Source: Ofcom researchNote: *Data for mobile penetration refer to the proportion of people who personally use a mobile phone

Growth in take-up of communications services, Q1 2005 to Q1 2008

26

Figure 1.22

154

42 65

24

2519

6

0%

20%

40%

60%

80%

100%

All adults Adults aged 65+

%ag

e of

peo

ple

with

out

inte

rnet

Unsure

Will not get(involuntary reason)

Will not get (voluntaryreason)

Will get

Intention to get the internet at homeCan you tell me if you intend to get internet access at home in the next year?

Source: Ofcom research, Q4 2007

27

Figure 1.23

Source: Ofcom / BARB / RAJAR / Nielsen NetratingsNote: Daily figures were calculated from monthly data on the assumption that there are 30.4 days in the average month; the exception was for internet consumption where the quoted figure relates to May 2008. The internet consumption figures are for internet users only in the period and include the use of online applications, and data are therefore not comparable to those in the previous chart.

Time spent using communications services, by age, 2007

218

164

60

301

184

90

0

100

200

300

400

Television Radio Internet Television Radio Internet

Min

utes

per

per

son

per

day All consumers Consumers aged 65+

28

Figure 1.24

50

7

48

5

22

17

19

13

16

26

9

10

9

22

4

11

5

25

4

10

2 1 2

0%

20%

40%

60%

80%

100%

All adults 65+ All adults 65+

Pro

port

ion

of m

obile

use

rs (

%)

Less than once a year

A few times a year

At least once a month

At least once a week

Several times a week

Every day

Source: Ofcom research

Frequency of mobile telephony usage, by age

Make a call Send a text message

29

Figure 1.25

5269 77

13

13

12 38 135 3 65 10 75 1 1

6

0%

20%

40%

60%

80%

100%

All adults Adults aged 65-74 Adults aged 75+

Pro

port

ion

of r

espo

nden

ts (

%) Other

Read newspapers /magazinesListen to music on astereoListen to the radio

Use the internet

Use a mobile

Watch TV

Which media activity would you miss the mostWhich one of these would you miss the most?


30

Figure 1.26

12 7 145

46

1820

17

1412

15

1617

15

11 1510

9 10 88 8 88 7 7

0%

20%

40%

60%

80%

100%

All individuals Adults 16-24 Adults 65+

Pro

port

ion

of v

iew

ing

(%)

Other

Sport

Films

Soaps

Other factual

Drama

Entertainment & contemporary music

Current affairs

News / weather

Source: BARBNote: Data are for all-day network programming on the terrestrial channels in 2007

Television viewing, by genre and viewer age

31

Figure 1.27

923

46

51

3113

11 112 1

0%

20%

40%

60%

80%

100%

All individuals 4+ Adults 65+

Pro

port

ion

of li

sten

ing

(%)

Other

National commercial

Local commercial

BBC Radios 1-4 and 5 Live

BBC local / regional

Source: RAJAR, Q1 2008

Radio listening by station type and age

32

Interest in internet / PC / laptop functions by age

FunctionAll adults who

use the internet

Adults aged 65+ who use the internet

Use email to contact friends and relatives 91% 90%

Transfer photos from a digital camera or mobile phone to a computer 83% 72%

Buy things over the internet 81% 68%

Install security features like a firewall, anti-spy or antivirus software 79% 58%

Find out about local services including the council, hospital, leisure facilities and so on

76% 67%

Install software on a computer which can control or block access to certain websites

74% 53%

Do my banking over the internet 58% 41%

Listen to radio over a computer 43% 15%

Join in debates about subjects that interest me through posting comments on websites

33% 11%

Any of these 97% 93%

Mean number of functions of interest 6.2 (out of 9) 4.8 (out of 9)


Figure 1.28

33

Figure 1.29

76

4841

24 22 2214 11

63

18

42

22

415

5 5

0

20

40

60

80

100

Co

mm

un

ica

tion

Wo

rk/s

tud

ies

info

rma

tion

Tra

nsa

ctio

ns

Ne

ws

Cre

ativ

ity

En

tert

ain

me

nt

Le

isu

rein

form

atio

n

Pu

blic

/civ

ic

Pro

port

ion

of a

dult

inte

rnet

use

rs (

%)

All adults

Adults aged 65+


Breadth of use of the internet, by age

34

Figure 1.30

51

43

21 1915

10 10 8

34 32

3

21

83 4 3

0

20

40

60

Any of these Uploaded photosto the internet

Set up own pageor profile on a

website such asFacebook,

MySpace, Bebo,Hi5 or Piczo

Contributedcomments to

someone else'sweblog/blog

Set up ownwebsite

Set up ownweblog/blog

Made a shortvideo and

uploaded it to theinternet

Contributed to acollaborative

website such asWikipediaP

ropo

rtio

n of

adu

lt in

tern

et u

sers

(%

) All adults

Adults aged 65+


Internet users’ experience of online creative activities, by age

35

Figure 1.31

Rank All adults who use the internet Adults aged 65+ who use the internet

1 Google Google

2 MSN / Windows Live BBC

3 BBC Yahoo!

4 Yahoo! MSN / Windows Live

5 eBay Microsoft

6 YouTube Amazon

7 Facebook eBay

8 Microsoft Ask search engine

9 Amazon Wikipedia

10 Wikipedia YouTube

11 AOL Media Network AOL Media Network

12 Ask search engine Tesco

13 Fox Interactive Media Virgin Media

14 Tesco Multimap

15 Lycos Network Europe BT

16 PayPal Orange

17 Bebo Grisoft

18 Blogger News Corp. Newspapers

19 Virgin Media Shopping.com Network

20 Sky Blogger

Source: Nielsen Netratings

Top 20 websites by age in May 2008

36

Figure 1.32

41 45 40

28 24 27

31 31 33

0%

20%

40%

60%

80%

100%


Pro

port

ion

of r

espo

nden

ts (

%)

Disagree

Neutral / unsure

Agree

Trust in television contentWhen I watch TV I tend to trust what I see


37

Figure 1.33

46 42 42

2724 30

2428

25

4 6 3

0%

20%

40%

60%

80%

100%


Pro

port

ion

of r

espo

nden

ts (

%) Unsure

Sceptical about theinformation

What I believe variesaccording to thechannel

I believe most of whatis shown


Belief in news and factual programmesWhen you watch news and factual programmes on TV, which of the following is closest to your view?

38

Figure 1.34

42 36

3127

2737

0%

20%

40%

60%

80%

100%

All adults Adults aged 65+

Pro

port

ion

of r

espo

nden

ts (

%)

Disagree

Neutral / unsure

Agree

Trust in website contentWhen I visit websites I tend to trust what I read or see


1.4: Advertising – a changing market

40

Advertising spend, by medium

Figure 1.35

4.8 4.9 5.1 4.9 4.7 4.7

1.9 1.8 1.9 1.9 1.8 1.8

3.7 3.7 4.0 4.1 3.9 4.0

0.7 0.8 0.8 0.9 0.9 1.00.2 0.5

0.8 1.4 2.0 2.911.9 12.313.3 13.8 14.0

14.9

0

5

10

15

2002 2003 2004 2005 2006 2007

Adv

ertis

ing

spen

d (£

bn) Internet

Cinema

Radio

Outdoor

Television

Magazine

Newspaper

Source: Advertising Association statistics published by www.WARC.com

Growth

Annual 5 year CAGR

39.5%

8.4%

3.5%

4.6%

2.3%

-3.8%

-0.4%

71%

-1.4%

0.2%

6.8%

1.6%

-1.2%

-0.6%

http://www.warc.com/

41

Share of advertising spend, by medium

Figure 1.36

41.0 39.4 38.3 35.5 33.5 31.3

16.2 14.8 14.3 13.7 13.0 11.8

31.6 30.2 29.6 29.6 27.9 26.8

6.06.4 6.4 6.5

6.76.5

1.7 3.8 6.2 9.9 14.4 19.1

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Adv

ertis

ing

spen

d (£

bn) Internet

Cinema

Radio

Outdoor

Television

Magazine

Newspaper



42

Total advertising spend per head, by nation & % of spend on internet, 2007

Figure 1.37

407357

217 219170 170 151

12.6

18.9

4.4

10.1

4.9

7.6

16.9

0

100

200

300

400

500

USA UK Germany Japan France Spain Italy

Per

cap

ita a

d sp

end

(Eur

o)

0

4

8

12

16

20

Inte

rnet

as

% o

f to

tal Ad

spendpercapita

Internetas % oftotal(RHS)



43

Distribution and growth of internet advertising spend (£m)

Figure 1.38

0.1 0.2 0.2 0.3 0.5 0.60.0

0.20.4

0.8

1.2

1.6

0.10.1

0.2

0.3

0.4

0.6

0.20.5

0.8

1.4

2.0

2.8

0

1

2

3

2002 2003 2004 2005 2006 2007

Adv

ertis

ing

spen

d (£

bn)

Otherclassified

Paid forsearch

Display

Growth

Annual5 year CAGR

54%

39%

29%

53%

108%

48%

Source: Advertising Association statistics published by www.WARC.comNote: All figures are nominal

44

Online revenues generated from television services

Figure 1.39

Source: Screen Digest media analyst consultancy

£3£2£6 £8

£12£8.7

£18.3

£3£0

£10

£20

£30

£40

2004 2005 2006 2007

Rev

enue

(£m

illio

ns)

Advertisingsupported

Subscription

VOD

DTO

45

Television advertising revenue, by broadcaster

Figure 1.40

1.74 1.68 1.73 1.68 1.47 1.42

0.64 0.63 0.68 0.710.67 0.68

0.24 0.25 0.28 0.300.29 0.29

0.53 0.680.80 0.86 1.04 1.16

3.15 3.253.48 3.55 3.47 3.54

0

1

2

3

4

2002 2003 2004 2005 2006 2007

Adv

ertis

ing

spen

d (£

bn)

Digital onlychannels

Five

C4 and S4C

ITV

Source: Ofcom / broadcasters

Growth

Annual 5 year CAGR

10.9%

0.5%

2.0%

-7.4%

17%

3.8%

1.2%

-4.0%

46

Share of television advertising revenue

Figure 1.41

55 52 50 47 42 40

20 19 19 2019 19

88 8 8

8 8

3 58 10

17 21 20 19 22 23

0

20

40

60

80

100

2002 2003 2004 2005 2006 2007

Sha

re o

f ad

vert

isin

g sp

end

%)

Digital onlychannels

PSB portfoliochannels

Five

C4 and S4C

ITV

Source: Ofcom / broadcasters

47

UK real GDP and advertising growth

Source: ONS / Advertising Association statistics published by www.WARC.com / Ofcom

-8%

-3%

2%

7%

12%

17%

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

0%

4%

8%

12%

Advertisinggrowth

Real GDPgrowth

Figure 1.42


48

0.1

0.2

0.7

0.4

0.7

1.5

0.2

0.5

0.9

2.2

4.13.8

0.2

0.3

0 1 2 3 4

GCap

Five

Channel4

ITV

BSkyB

Revenue (£ billion)

Other revenue

Advertisingrevenue

Advertising vs total revenue for selected commercial broadcasters, 2006-07

Figure 1.43

Source: Ofcom, broadcasters

Section 2: Convergence

2.1: Key market developments

50

0%

20%

40%

60%

80%

100%

Broadcast iPlayer Broadcast iPlayer Broadcast iPlayer

Source: Ofcom calculations based on BBC Press Release April 2008

Shows in the top 20 Genres in the top 20 Originating channel

EastEnders

16

Apprentice5

Gavin & Stacey 3 Drama

19

Factual 1

Dr Who4

Factual12

Drama 8

BBC One20

BBC One11

BBC Two 3

BBC Three6

Dawn goes..TorchwoodGlamour girlPg 3 teens

Dr Who 2

Apprentice 1Casualty 1

PenguinsAmy: my body

Top GearHIGNFY

Figure 2.1

Analysis of BBC iPlayer top twenty shows, April 2008

51

Figure 2.2

Difference in the profile of the BBC's broadcast and iPlayer audiences

Source: BBC, BARB and ONS estimates for 2008 populationNote: this is an approximate calculation only based on the eight channels featured on the iPlayer: BBC One, BBC Two, BBC3, BBC4, CBBC, CBeebies, BBC News, BBC Parliament. However, not all BBC programmes are shown on the iPlayer, for example regional news and weather. The metrics are also different: broadcast channel data is based on share of viewing in minutes, whereas iPlayer is based on breakdown of users (irrespective of time spent viewing)

31% 37%

35%

32%

43%

35%52%

21%

17%0%

20%

40%

60%

80%

100%

2008 population Broadcast channels -share of viewing

iPlayer - share of users

55+

35-54

16-34

52

32%37%

17%20%

32%

50% 52%

27%22%

45%

35%39%

16%21%

38%

27%

35%

16%21%

25%

11%17%

7%

14%11%

0%

10%

20%

30%

40%

50%

60%

Playing gamesonline/interactively

Downloading musicfiles, movies or video

clips

Watching TVprogrammes

Listening to the radio Watching videoclips/webcasts

All 15-24 25-44 45-64 65+

Base: All adults who have the internet at homeSource: Ofcom research, Jan 2008

2 10 3 3 -8 -6 -3 -12 1 1 8 17 5 9 5 -1 4 -4 -1 2 11 18 13 10 3

Increase in activities since Q1 2007(percentage points)

Figure 2.3

Proportion of households using the internet for the listed activities% of households who use the internet for the following activities

53

Figure 2.4

Viewing of user-generated video content

87%83%

58%

0%

20%

40%

60%

80%

100%

15-24 25-44 45-64

Source: Ofcom research, Feb-Mar 2008, “Which of the following types of video clips or programmes do you or members of your household watch over the internet?” Base: All who watch video clips/TV programmes/news on the internet (n=387; 15-24 n=70 (note small base); 25-44 n=172; 45-64 n=114

54

Figure 2.5

Consumer value placed on professional and user-generate content

9 13 7 2

34 26 35 47

53 56 53 44

55 4 7

0%

20%

40%

60%

80%

100%

Total 16-34 35-54 55+

Don't know

Value both equally

Content that is professionallymade by organisations

Content that is created byordinary people (for exampleblogs social networking pages)

Source: PSB online survey – online panel, GfK, 2007 - Q31 Which of the following do you value more? Total sample = 3003, 16-34 = 973, 35-54 = 1319, 55+ = 711

55

Figure 2.6

DVR take-up by platform

0

1

2

3

4

5

Sep-03 Sep-04 Sep-04 Sep-05 Sep-06 Sep-07

Freeview

V+

Sky +

Homes (m)

Source: Operator results and sales data

56

58%

6%6%

30%

Always

Sometimes

Rarely

Never

% of people who check what’s on live TV before watching a recorded programme

Source: Ofcom research, Feb/Mar 2008 Base: All who use a DVR

88%

7%

3%6%

Always /almost always

About half thetime

Never / hardlyever

NeverAlways/almost

always

Figure 2.7

Frequency of checking live TV before watching a recorded programme

AlwaysSometimes

57

30%

7%

5%

6%

11%

4%

13%

7%

4%

4%

4%

3%

18%

14%

13%

16%

13%

64%

32%

23%

23%

31%

20%

21%

0% 20% 40% 60%

Via dial-up or broadband, including both wired andwireless connections via a router

Using a free public wireless or WiFi network

Using a public wireless or WiFi connection that you pay for

Using a mobile datacard or USB dongle attached to mylaptop

On my mobile phone

By connecting my mobile phone to my laptop

Daily

Weekly

Less often

Source: CAPI OmniBus, July 2008. Base: Those who access the internet away from home or work (11% of all users). Note: Multi-code question (multiple responses permitted)

Figure 2.8

Methods of accessing the internet away from home or workHow often do you use the following methods to connect to the internet when away from home or work?"

58

Figure 2.9

New mobile broadband connections

63 77 88 96 101

910

28 3298

125133

6

86

69

0

50

100

150

Feb-08 Mar-08 Apr-08 May-08 Jun-08

New

mon

thly

con

nect

ions

(00

0s)

Pre-pay

Contract

Source: GfK retail data (includes only consumer channels)

59

2 7 10 8 11

76 67 58 59 50

3 6 146 14

10 9 718 12

1 18 4 5

8 11 3 6 9

0%

20%

40%

60%

80%

100%


Pro

port

ion

of c

ontr

acts

(%

) £50.00+

£30-49.99

£25-29.99

£20-24.99

£15-19.99

£0-14.99

Source: GfK retail data

Figure 2.10

Monthly rental for new mobile broadband connections

60

Source: GFK consumer panel, Q1 2008

10%

13%

18%21%

20%

18%

16-24

25-34

35-44

45-54

55-64

65+

Figure 2.11

Age profile of mobile broadband users, Q1 2008

61

Source: GFK consumer panel, Q1 2008Notes: multi-code question; Caution low sample for 16-24 and over 65 – use as a guide only

27 25 29 25 31 3511

18 20 24 20 16 13

10

75 69 73 73 76 7787

0%

20%

40%

60%

80%

100%

Total 16-24 25-34 35-44 45-54 55-64 65+

% o

f m

obile

bro

adba

nd u

sers

At home

At work

Elsewhere/On the move

Figure 2.12

Location of mobile broadband use

Where do you use mobile broadband?

62


6853

70 74 67 75 81

3247

30 26 3325 19

0%

20%

40%

60%

80%

100%

Total 16-24 25-34 35-44 45-54 55-64 65+

% o

f m

obile

bro

adba

nd u

sers

Instead of afixed internetconnection

In addition to afixed internetconnection

Figure 2.13

Use of mobile and fixed line broadband

Is your mobile broadband in addition or instead of a fixed connection?

63


21 24 26 21 2514 7

1826 18

16 1117

15

1917

1917 20

1924

66 8

6 67

5

1313 8

14 16 20

12

74 10

8 6 7

3

16 11 11 17 15 1536

0%

20%

40%

60%

80%

100%

Total 16-24 25-34 35-44 45-54 55-64 65+

% o

f m

obile

bro

adba

nd u

sers Unsure

Once in the last month

Several times in thelast month

Once a week


Once a day

More than once a day

Figure 2.14

Usage frequency of mobile broadband

How often do you use mobile broadband?

64

36%

55%51%

29%

2%

39%

63%55%

33%

4%

0%

20%

40%

60%

80%

All 15-24 25-44 45-64 65+

Q1 2007 Q1 2008

Figure 2.15

Access to games devices in the home


Proportion of adults

65

Figure 2.16

Activities undertaken by consumers using games consoles

39%

26%

10%

8%

6%

7%

4%

4%

3%

2%

1%

0% 10% 20% 30% 40%

Watching DVDs

Music CDs

MP3

Online gaming

Downloading gaming content

View photos

Watching blu-ray/HD DVDs

Internet access

News/weather updates

Uploading content to internet

Other

Source: Ofcom research, Feb/Mar 2008Base: All adults who use games console

Content

67

Physical£1042m

Mobile£23m

Physical£862m

Digital £81mDigital £67m

PC£52m

0%

20%

40%

60%

80%

100%

2006 2007 Online/mobile split in 2007

+21%

£1,109m £943m

Growth (% YOY)

-15%

-17%

Figure 2.17

Value of music sales, 2006 and 2007

Source: BPI and IFPI press releases

Proportion of total sales (%)

68

Source: Ofcom calculations based on data from BPI (all incl 77m) and Screen Digest (the digital component except for 2007).

152m

24m9m

44m 77m

133m

5m

3m

0

40

80

120

160

2006 2007 2006 2007

Digital

Physical

Sales volumes in millions

158m 138m 68m 86m

Albums Singles

-13% +26%

Figure 2.18

Volume of music sales, 2006 and 2007

69

0

5

10

15

20

25

Q4 2003 Q4 2004 Q4 2005 Q4 2006 Q4 2007

Albums

Singles

Music downloads sold per quarter (millions)CAGR

1 yr 4 yr

67% 114%

60% 87%

Figure 2.19

Volume of music downloads


70

19%

6%

2%

24%

12%

6%

24%

15%

13%

10%

5%

5%

11%

6%

4%

9%

2%

1%

0% 5% 10% 15% 20% 25%

Music

Film

TV

13-15

16-17

18-24

25-34

35-44

45+Source: Olswang Consumer Convergence Survey conducted by YouGov, November 2007.Base: All respondents (n=1793, aged 13-55)

Figure 2.20

Do you stream/download/copy music/films/TV programmes illegally?

Proportion of respondents

71

41%

44%

36%

25%

19%

57%

53%

38%

30%

24%

0% 10% 20% 30% 40% 50% 60%

13-17

18-24

25-34

35-44

45+

2006

2007

Source: Olswang Digital Music Survey, conducted by Entertainment Media Research, July 2007.Base: All respondents (n=1721)

Figure 2.21

Have you ever illegally downloaded unauthorised music from file sharing sites such as Bit Torrent, Limewire etc?


72

Figure 2.22

Independent producers' TV and non-broadcast revenue

£1,400m£1,890m

£105m

£242m

£1,750m

£199m

0

500

1000

1500

2000

2500

2005 census 2007 census 2007/08 census

Non-TVactivities

Television

£m

Source: Pact/Digital-i

73

Figure 2.23

Independent producers' breakdown of new media revenue

£19m

£42m£39m

£0m

£10m

£20m

£30m

£40m

£50m

2005 2006 2007

Source: Pact/Digital-i

74

31

57

6 812

3 2

914

0

20

40

60

Tomb Raider Grand TheftAuto

ChampionshipManager

Burnout Worms Black andWhite

Eilte Roller CoasterTycoon

Driver

Mill

ions

of

units

sol

d

Source: Playing for Keeps, Games Investor Consulting, 2007 and Ofcom

Iterations

Date of first iteration

7

1996

7

1997

18

1992

5

2000

11

1995

2

2001

3

1984

3

1999

3

1999

Figure 2.24

Unit sales of key games franchises

75

Year-on-year growth (%)

Source: M:Metrics

2.2

1.41.2

1.0 1.0

0.0

0.5

1.0

1.5

2.0

2.5

Arcade puzzle Retro arcade Word or number Card Sports

3 monthsendingJanuary2008

Estimated millions of subscribers

450% 600% 500% 900% 400%

Figure 2.25

Top five genres of purchases mobile games (millions of subscribers)

76

0

20

40

60

80

2002 Q

2

2002 Q

4

2003 Q

2

2003 Q

4

2004 Q

2

2004 Q

4

2005 Q

2

2005 Q

4

2006 Q

2

2006 Q

4

2007 Q

2

2007 Q

4

MMS

SMS


CAGR (%)

1 yr

0.9

28.0

4 yr

1.0

16.7

Figure 2.27

Messages per connection per month

Monthly volumes of SMS and MMS

77


69.3 67.461.6

22.4 22.3 23.5 26.9

70.1 70.6

23.2

0

20

40

60

80

2003 2004 2005 2006 2007

Fixed voiceminutes perresidentialconnection

Mobileminutes perconnection

Weekly voice minutes per residential fixed line / mobile connection

CAGR (%)

1 yr 4 yr

-8.6

14.5

-3.2

3.8

Figure 2.28

Fixed and mobile minutes

78

8%

10%

15%

19%

21%

43%

11%

11%

10%

17%

10%

10%

18%

77%

77%

76%

67%

69%

67%

39%

4%

2%

3%

2%

2%

2%

1%

10%

0% 20% 40% 60% 80% 100%

Contributed to a wiki

Made a short video and uploaded it to the internet

Set up your own blog

Set up your own website

Contributed comments to someone else's blog

Set up a profile on a website like Bebo/Facebook/MySpace

Uploaded photos to the internet

Done this Interested in doing this Not interested Unsure

IN28A-G – I’d like to read out a number of things people might do using the types of technologies we’ve been talking about. For each one, could you please tell me if you’ve done it, or you’d be interested in doing it, or you’re not interested in doing it?Base: All who use the internet at home or elsewhere (1723)Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in October to December 2007

Figure 2.29

Levels of interest in or engagement with user-generated content types

79

66%

62%

48%

29%

36%

27%

16%

17%

8%

12%

11%

11%

7%

6%

1%

5%

25%

13%

6%

5%

8%

3%

8%

4%

61%

46%

36%

15%

15%

45%

28%

20%

19%

12%

42%

12%

11%

6%

35%

7%

9%

8%

4%

8%

12%

32%

21%

3%

3%

0% 20% 40% 60%

Uploaded photos to the internet

Set up your own page or profileon a SNS website

Contributed comments tosomeone else's weblog/ blog

Set up your own website

Set up your own weblog/ blog

Made a short video and uploadedit to the internet

Contributed to a collaborativewebsite such as Wikipedia

65+

55-64

45-54

35-44

25-34

20-24

16-19

Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in October to December 2007. Question “I’d like to read out a number of things people might do using the types of technologies we’ve been talking about. For each one, could you please tell me if you’ve done it, or you’d be interested in doing it, or you’re not interested in doing it?” . Base: All who use the internet at home or elsewhere (1723 aged 16+, 186 aged 16-19, 150 aged 20-24, 332 aged 25-34, 473 aged 35-44, 319 aged 45-54, 156 aged 55-64, 103 aged 65+). The survey did not include children.

Figure 2.30

Experience of creative activities by age

80

0

2

4

6

8

10

Apr-07

May-07

Jun-07

Jul-07

Aug-07

Sep-07

Oct-07

Nov-07

Dec-07

Jan-08

Feb-08

Mar-08

Apr-08

YouTube

Facebook

Wikipedia

bebo

Myspace.com

Blogger

Growth (%) (Apr 07–Apr 08)

44

278

5

17

-28

20

Figure 2.31

Visitors to user-generated content websites

Source: Nielsen Online, home use only

81

15%27%

55%67%

84%

50%

71%

45%33%

49%

1% 1% 2%

0%

20%

40%

60%

80%

100%

Parents of 8-17s All children (8-17) Aged 8-11 Aged 12-15 Aged 16-17

Unsure

No

Yes

Source: Ofcom – Children, Young People and Online Content, October 2007. Question “Do you have a page or profile on a social network site?”Base: All aware of social networking sites / whose child uses the internet: Parents of 8-17s (481), children aged 8-11 (143), 12-15 (202), 16-17 (106)

Figure 2.32

Percentage of parents saying they have a profile on a SNS vs. children

Aggregation

83

Figure 2.33

Advertising spend by medium

4.8 4.9 5.1 4.9 4.7 4.7

1.9 1.8 1.9 1.9 1.8 1.8

3.7 3.7 4.0 4.1 3.9 4.0

0.7 0.8 0.8 0.9 0.9 1.00.2 0.5

0.8 1.4 2.0 2.911.9 12.313.3 13.8 14.0

14.9

0

5

10

15

2002 2003 2004 2005 2006 2007

Adv

ertis

ing

spen

d (£

bn) Internet

Cinema

Radio

Outdoor

Television

Magazine

Newspaper


Growth

Annual 5 year CAGR

39.5%

8.4%

3.5%

4.6%

2.3%

-3.8%

-0.4%

71%

-1.4%

0.2%

6.8%

1.6%

-1.2%

-0.6%


84

Figure 2.34

Distribution of advertising spend by medium

41.0 39.4 38.3 35.5 33.5 31.3

16.2 14.8 14.3 13.7 13.0 11.8

31.6 30.2 29.6 29.6 27.9 26.8

6.06.4 6.4 6.5

6.76.5

1.7 3.8 6.2 9.9 14.4 19.1

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Adv

ertis

ing

spen

d (£

bn) Internet

Cinema

Radio

Outdoor

Television

Magazine

Newspaper

85

Figure 2.35

Television net advertising revenue

Source: Ofcom/Broadcasters.Note: Growth rate calculations based on revenue figures not shares. CAGR for commercial analogue channels is calculated over a five year period

79% 77%

3%

17% 21% 20% 19% 22% 23%

67%70%76%83%

8%5%

10%

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Commercialmultichannels

CommercialPSB portfoliochannels

Commercialanaloguechannels

£3,544m£3,469m£3,548m£3,481m£3,242m£3,147m

CAGR (%)

1 yr

2.2

6.0

29

-1.6

3 yr*

2.4

6.4

52

-1.6

86

12% 14% 13%

25%32%

18%

3.8% 4.1%

5.5%

7.6%

9.4%

4.2%

0%

10%

20%

30%

40%

2002 2003 2004 2005 2006 2007

0.0

2.5

5.0

7.5

10.0

Proportion ofparent channelshare

Portfoliochannel share

Audience share (%) Proportion of parent channel share (%)

Source: BARB / Ofcom

Figure 2.36

Share of PSB portfolio channels in multi-channel homes

87

Source: Screen Digest media analyst consultancyNote: Figures cited in this chart may not match exactly those in other related charts, owing to the use of different data sources.

£75.8

£8.3

£26.6

£47.8£4.8

£6.4

£1.70

20

40

60

80

100

2004 2005 2006 2007

Rev

enue

(£m

illio

ns)

Subscription

Pay-per-download

Figure 2.37

Online music revenue

88

Figure 2.38

Commercial radio's share of listener hours

44.2%46.0% 43.2%42.8%45.0%

42.4%

8.0%10.0% 10.1% 10.5%10.0% 11.3%

38.0%32.7% 32.8%34.2%35.7%

31.1%

0%

10%

20%

30%

40%

50%

2002 2003 2004 2005 2006 2007

Allcommercial

Nationalcommercial

Localcommercial

Source: Ofcom/RAJAR

89

Figure 2.39

Commercial radio advertising revenue

£291m £306m £286m £274m £268m £271m

£146m £163m £177m £169m £153m £156m

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Localcommercial

Nationalcommercial

Source: Ofcom / operator data / BBCNote: BBC figures are estimated by Ofcom based on BBC Annual Report. Figures in the chart are rounded.

£509m £543m £551m £530m £512m £522m

Commercial radio advertising revenue (£m)

90

Source: Ofcom / RAJAR

7.0%9.9% 10.8%

2.6%3.0%

3.1%3.2%

1.5%1.6%

1.9%2.1%

1.7%

1.9%1.7%

1.7%

8.6%

0%

5%

10%

15%

20%

Q2 2007 Q3 2007 Q4 2007 Q1 2008

Pla

tfor

m s

hare

Digitalunspecified

Internet

DTV

DAB

15.0%12.8% 17.8%16.6%All digital radio platform share

Figure 2.40

Digital listening by platform

91

Figure 2.41

National and local paper advertising revenue

£2879m £2962m £3132m £2994m £2782m £2746m

£1929m £1902m £1974m £1912m£1912m £1918m

£4808m £4864m£5106m £4906m £4694m £4664m

0

1000

2000

3000

4000

5000

6000

2002 2003 2004 2005 2006 2007

National

Local

CAGR (%)

1 yr

0.3

-1.3

3 yr

-1.0

-4.3

5yr

-0.1

-0.9


92

Figure 2.42

Components of newspaper advertising revenue

£1938m £2013m £2138m £2044m £1899m £1881m

£941m £949m £994m £950m £883m £865m

£460m £466m £480m £449m £424m £388m

£1469m £1436m £1494m £1463m £1488m £1530m

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

National display

National classified

Local display

Local classified

£4,808m £4,864m £5,106m £4,906m £4,694m £4,664m CAGR (%)

1 yr

2.8

-8.5

-2.0

-0.9

3 yr

0.8

-6.8

-4.5

-4.2

5yr

0.8

-3.3

-1.7

-0.6


93

Figure 2.43

Changes in components of newspaper advertising revenue

£5106m

£4720m £4664m

£257m

£129m£92m £36m

4,000

4,500

5,000

5,500

Newspaperadvertising spend

2004

Local classified Local display National classified National display Newspaperadvertising spend

2007


94

Figure 2.44

Circulation of national newspapers

0

1

2

3

4

2004 2005 2006 2007

SunDaily MailDaily MirrorDaily TelegraphDaily StarDaily ExpressPeopleTimesFinancial TimesGuardianIndependent

CAGR (%)

1 yr 4 yr

-1.6

-1.6

-5.0

-1.1

-1.7

-5.5

-13.5

-3.8

1.3

-3.5

-3.3

-2.3

-1.1

-5.3

-.07

-4.4

-6.2

-10.7

-1.0

-1.0

-0.9

-1.8

Ave

rag

e d

aily

sal

es

(m)

10.4m2.6m

RedtopsBroadsheets

10.0m2.7m

9.6m2.6m

9.3m2.6m

-3.6-2.0

-3.8-0.6

Source: ABC/MediaTel.co.uk

95

Figure 2.45

National newspaper websites: unique audiencesAnnual

growth (%)

0

0.5

1

1.5

2

2.5

Apr-07

May-07

Jun-07

Jul-07

Aug-07

Sep-07

Oct-07

Nov-07

Dec-07

Jan-08

Feb-08

Mar-08

Apr-08

Guardian.co.uk

Telegraph

The Sun

Times Online

Daily Mail

The Independent

Mirror.co.uk

FT.com

Daily Express

Daily Star

4.4

49.0

20.0

22.8

81.2

20.4

69.9

143.3

74.3

54.8

Source: Nielsen Online – ‘At home’ data (most newspapers’ websites represent the daily and the Sunday paper). Note that annual growth is calculated from April 2007 to April 2008.

96

Figure 2.46

Internet advertising by category

0.1 0.2 0.2 0.3 0.5 0.60.0

0.20.4

0.8

1.2

1.6

0.10.1

0.2

0.3

0.4

0.6

0.20.5

0.8

1.4

2.0

2.8

0

1

2

3

2002 2003 2004 2005 2006 2007

Adv

ertis

ing

spen

d (£

bn)

Otherclassified

Paid forsearch

Display

Growth

Annual5 year CAGR

54%

39%

29%

53%

108%

48%


97


£3£2£6 £8

£12£8.7

£18.3

£3£0

£10

£20

£30

£40

2004 2005 2006 2007

Rev

enue

(£m

illio

ns)

Advertisingsupported

Subscription

VOD

DTO

Figure 2.47

Online TV revenues

98

Figure 2.48

Websites/utilities used to download music/film from the internet

BitTorrent, 6%

Other (mainly legal), 9%

Other (mainly illegal), 4%

Other (unspecified), 4%

Google Video, 6%

BBC iPlayer, 11%Limewire, 17%

iTunes, 28%

YouTube, 16%


99

Figure 2.49

Attitudes towards behaviourally targeted advertising

35 26 26 25

3231 35 34

2937 36 38

4 6 3 3

0%

20%

40%

60%

80%

100%

Recommendations basedon previous purchases(e.g. Amazon / Tesco)

Social networking sitessuggesting someone you

may know (e.g.Facebook)

Advertising on searchengines where some links

are highlighted (e.g.Google or MSN)

Advertising based on yourweb browsing / searching

habits

Pro

port

ion

of m

obile

use

rs (

%)

Unsure

Negative

Neither positivenor negative

Positive


100

Figure 2.50

Unique visitors to selected video sharing sites

0

2

4

6

8

10

Dec-06 Feb-07 Apr-07 Jun-07 Aug-07 Oct-07 Dec-07 Feb-08 Apr-08

Uni

que

user

s (m

illio

ns)

YouTube

GoogleVideo

Metacafe

Veoh

Dailymotion

Source: Nielsen Online

101

131m(446%)

176m(291%)

179m(477%)

203m(74%)275m

1823m(1995%)

0m

500m

1000m

1500m

2000m

UniversalMusic Group

Sony BMG CBS Warner BrosRecords

RCA Records NBA

Tot

al v

iew

s up

unt

il 06

Jun

e 20

08

YouTube channel rank

Videos uploaded 2007

Videos uploaded 2006

1

4,821

3,747

2

1,744

3

7,106

2,059

5

990

820

6

31

26

12

1,148

286

Source: YouTube statistics in June 2007 and June 2008

Growth since 2007 report

Figure 2.51

The popularity of YouTube channels

Distribution

103

Figure 2.52

Availability of Virgin Media cable broadband

Source: Ofcom / Virgin Media, Q4 2007

104

Figure 2.53

Location and distribution networks across the radio spectrum

Source: Ofcom

Medium Wave radio

ElectricWaves

RadioWaves Infra-red

VisibleLight

UltraViolet X-Rays

GammaRays

CosmicRays

30 3 30300

Long Wave radio

FM radio

VLF LF MF HF VHF UHF SHF EHF

Radio SpectrumRadio Spectrum

kHz MHz GHz330300 300

Decreasing RangeIncreasing Bandwidth

Increasing RangeDecreasing Bandwidth

3

Prime region

Short Wave radio DABGSM

Satellite TV

Bluetooth / WiFi

3G/ 3.5G

105

Figure 2.54

Revised timetable for the introduction of market mechanisms to spectrum

Source: OfcomNote: Percentages refer to the proportion of spectrum in each of the two bands

Predicted in the SFR

Current position

Revised prediction for

2010

Licence-exempt 4% 4% 4%

0-3 GHz Market mechanisms 66% 27% 54%

Command and control 29% 68% 41%

Licence-exempt 10% 10% 10%

3 GHz+ Market mechanisms 69% 61% 66%

Command and control 21% 29% 24%

106

Figure 2.55

Value generated by use of spectrum in the UK

14.4

5.9

2.9 3.8

0.01.1 0.1

21.8

14.7

2.83.9

0.3 1.2 0.10

5

10

15

20

25

Publicmobile

Broadcasting Satellite links Fixed links Wirelessbroadband

Privatemobile radio

Other

Val

ue g

ener

ated

(£b

n)

2002

2006

Source: Europe Economics, March 2006

107

Figure 2.56

Weighted use of spectrum

Aeronautical and maritime, 14%

Science, 1%

Broadcasting, 13%

Defence, 30%

Cellular, 4%

Business radio, 5%Other, 7%

Emergency services, 2%

Fixed / satellite, 24%

Source: Ofcom

108

Figure 2.57

2G and 3G availability

Source: Ofcom

2G 3G

109

Figure 2.58

DAB coverage by at least one multiplex

Source: Ofcom

110

Figure 2.59

The footprints of SES-Astra’s satellites that carry services targeting the UK

Source: SES Astra

111

Figure 2.60

WiFi hotspots by operator

7,531

2,323

1,260570 250 239 231 82

0

2,000

4,000

6,000

8,000

The Cloud BTOpenzone

T-Mobile Swisscom Surf n Sip Spectrum iBahn Orange

Source: Informa

Consumption

113

Proportion of individuals (%)

0%

20%

40%

60%

80%

100%

2000 2001 2002 2003 2004 2005 2006 2007 Q12008

Video recorder

Digital television

DVD player

MP3 player

TV-enabled PC

DAB digital radio

DVR

3G handset

2G handset

CAGR (%)

1 yr

-8

10

-3

14

7

35

88

52

-7

3 yr

-7

25

35

88

34

n/a

147

n/a

0.7

Figure 2.61

Audio visual devices - penetration

Source: Ofcom research.Note: CAGRs are calculated against the full 2007 year base (i.e. not using Q1 2008).

114

0%

20%

40%

60%

80%

100%

16-19 20-24 25-34 35-44 45-54 55-64 65-74 75+

All three platforms

Mobile phone & digital TV

Mobile phone & internet

Digital TV & internet

Mobile phone only

Digital TV only

Internet only

T1/ IN1/ M1 – Can any of your TV sets receive additional channels other than BBC, ITV, Channel 4/ S4C and (where available) Channel 5?/ Does anyone in your household have access to the internet at home through a computer or laptop?/ Do you personally use a mobile phone?Base: All adults aged 16+ (206 aged 16-19, 207 aged 20-24, 473 aged 25-34, 661 aged 35-44, 489 aged 45-54, 341 aged 55-64, 356 aged 65-74, 167 aged 75+)Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in October to December 2007

Figure 2.62

Take-up of DTV, DAB and internet by age

115

0%

20%

40%

60%

80%

100%

16-19 20-24 25-34 35-44 45-54 55-64 65-74 75+

Mobile phone 2007

Mobile phone 2005

Digital radio 2007

Digital radio 2005

Digital TV 2007

Digital TV 2005

Internet 2007

Internet 2005

T1/ R1/ IN1/ M1 – Can any of your TV sets receive additional channels other than BBC, ITV, Channel 4/ S4C and (where available) Channel 5?/ In which of these ways do you ever listen to radio in your home?/ Does anyone in your household have access to the internet at home through a computer or laptop?/ Do you personally use a mobile phone?. Base: All adults aged 16+ (206 aged 16-19, 207 aged 20-24, 473 aged 25-34, 661 aged 35-44, 489 aged 45-54, 341 aged 55-64, 356 aged 65-74, 167 aged 75+)Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in October to December 2007

Mobile phoneDAB Digital radio

DTVInternet

16-192288

20-243

232915

25-3401

226

35-4426

2111

45-545

111719

55-649

121911

65-74-312133

75+8

19220

Change in take-up, 2005 - 2007 (percentage points)

Figure 2.63

Digital technologies by age, 2005 and 2007

116

1.20.9 1.0

1.71.3

1.1 1.1

2.01.6

1.8

1.2

1.8

1.2 1.0 0.9

2.1

1.10.8 0.7 0.9

0.5

0.1

0.10.1 0.1

0.2

0.20.1

0.2

0.4

0.40.5 0.5

0.7

0.80.9 1.1

2.2

1.8

0

1

2

3

Q1 2003 Q1 2004 Q1 2005 Q1 2006 Q1 2007 Q1 2008

Sal

es (

mill

ions

)

Digital

Analogue

Source: GfK

TV sets sold per quarter (million)

Figure 2.64

Quarterly sales of television sets

117

0

1,000

2,000

3,000

4,000

5,000

6,000

Q1 2002 Q1 2003 Q1 2004 Q1 2005 Q1 2006 Q1 2007 Q1 2008

Ave

rage

pri

ce p

er u

nit

(£) HD-ready

Digital

Analogue

Source: GfK

Figure 2.65

Average price of a TV set

118

348 454 5251,081 942 1,015 1,270

2,2131,787

24%33% 37% 38%

44%52%

61%70%

79%

0

1,000

2,000

3,000

Q12006

Q22006

Q32006

Q42006

Q12007

Q22007

Q32007

Q42007

Q12008

Set

sal

es (

000'

s)

0%

30%

60%

90%

As

% o

f al

l set

sal

es

Set sales

% of allsets sold

Source: GfK

Figure 2.66

HD-ready sets - sales volumes as a % of all set sales

119

Source: GfK

60% 58% 52% 45% 43%

40% 42% 48% 55% 57%

0%

20%

40%

60%

80%

100%

2004 2005 2006 2007 May 2007 -April 2008

% o

f T

Vs

sold >26"

<26"

Figure 2.67

TV set sales by screen size

120

Figure 2.68

DAB sets sold by quarter

4 5 4 3 4 8 10 28113 73 53 78

163 102 77 82177

95 69 86200

16 18 33 48176 101 90 105

373

184 150206

517

233 208 224

611

284244 272

745

0

200

400

600

800

1000

Q4 2002 Q4 2003 Q4 2004 Q4 2005 Q4 2006 Q4 2007

Sal

es (

000'

s)

Portable

Car

In-home

Source: GfK

Q4 CAGR (%)

3yr

26

-9

21

1 yr

22

-12

13

121

Figure 2.69

Average price of a DAB digital radio set

£0

£100

£200

£300

£400

£500

Q12003

Q3 Q12004

Q3 Q12005

Q3 Q12006

Q3 Q12007

Q32007

Q12008

All

In-home

Car audio

Portable

Source: GfK Q1 2007

122

Source: Rajar / Ofcom

Figure 2.70

DAB set penetration, by local multiplex area, Q4 2007

123

Figure 2.71

Use of mobile phone functions

1%2%2%2%

4%7%

8%9%9%

11%11%

12%13%

15%17%

34%41%

4%

0% 10% 20% 30% 40% 50%

PodcastsWalkie-talkieVideo calling

Ability to locateDownload applications

Doanload video clipsEmail access

Instant MessengerFM radio

Send and receiveInternet access

Video cameraMP3

Diary or organiserUpload pictures to PC

GamesStore photos

Camera

% of people using mobile functions

Source: Ofcom research, Feb/Mar 2008Base: All who own a mobile phone

124

Figure 2.72

Devices used to store content

Source: Olswang Convergence Consumer Survey 2007/YouGov, November 2007Base: All respondents

58%

49%

44%

30%

20%

0.18

0.1

0.07

0.02

0.04

0% 20% 40% 60%

Built-in computer hard drive

Recordable CDs

USB 'dongle'

Memory card

Recordable DVDs

Portable devices with hard driveExternal hard drive connected directly to your

computerFloppy disks

Online remote storage deviceExternal drive connected to home network (but not

connected directly to computer)None of these

Don't know


125

Figure 2.73

Frequency of backing up files

Source: Olswang Convergence Consumer Survey 2007/YouGov, November 2007Base: All respondents

53%

47%

32%

25%

11%

8%

9%

0% 20% 40% 60%

My photos

My office documents

My music

None of these

My videos

Other

Unsure


126

61%

49%

15%

11%

10%

5%

5%

2%

2%

72%

16%

13%

8%

6%

7%

2%

0%

48%

72%

16%

13%

9%

5%

6%

1%

1%

57%

60%

18%

14%

8%

4%

8%

1%

1%

69%

35%

14%

9%

8%

5%

3%

2%

3%

49%

0% 20% 40% 60% 80%

TV Guide - paper or magazine

Onscreen TV guide

Channel hopping

Trailers

Teletext

TV guide on internet

Recommendations

Other

Unsure

Proportion of respondents (%)

All with TV

DVR owners

Satellite

Cable

Freeview only

Figure 2.74

How consumers find out what to watch on TV

Source: Ofcom research, Feb/Mar 2008 Base: All with TV, multi-code allowed

127

0

1

2

3

4

H11986

H11988

H11990

H11992

H11994

H11996

H11998

H12000

H12002

H12004

H12006

Ave

rage

net

sal

es p

er e

ditio

n TV Choice

What's OnTV

RadioTimesTV Times

TV Easy

TV Quick

Total TVGuide

Source: ABC/MediaTel.co.uk

Figure 2.75

Listings magazines' circulation

128

0

100

200

300

400

April 2007 July 2007 October 2007 January 2008 April 2008

Uni

que

audi

ence

(00

0's)

RadioTimes

What's onTV

TV Easy

TV Times

Source: Nielsen Online, home use only

Figure 2.76

Unique users to listings magazines’ websites

129

Figure 2.77

Channel shares in cable and satellite homes

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

2.0

2.2

2.4

2.6

2.8

3.0

Ch

ildre

n

Entertainment

ITV

2

E4

Hal

lmar

k

BB

C T

hree

UK

TV

Gol

dU

KT

V D

ram

a

Cha

lleng

e T

V

CABLE

S4C

Sci

Fi

Mor

e4

UK

TV

His

tory

Dis

cove

ry C

hann

el

UK

TV

Sty

le

The

Hits

/4M

usic

TC

M a

nd M

ovie

s24

Film

4S

ky S

port

s 1

Eur

ospo

rt

BB

C N

ews

CB

eebi

es

Livi

ng

Sp

ort

Factual/leisure

Mu

sic

Film

New

s

Dis

ney

Boo

mer

ang

Car

toon

Net

wor

k

UK

TV

Gol

dIT

V2

UK

TV

Dra

ma

E4

Hal

lmar

k

Fx F

ive

US

Fiv

erU

KT

V S

tyle

UK

TV

Foo

dD

isco

very

Rea

l Tim

e+1

Dis

cove

ry T

rave

l & L

ivin

g

Sky

Mov

ies

Pre

mie

rS

ky M

ovie

s F

amily

Film

4

MT

V O

ne

Mag

ic T

V

Sky

Spo

rts

2S

ky S

port

s N

ews

Eur

ospo

rtS

etan

ta 1

Sky

New

sB

BC

New

sD

isco

very

Crim

e &

Inv

estig

atio

n

Nic

kelo

deon

CB

eebi

esD

isne

y C

hann

el

En

tert

ain

men

t

Film

Sp

ort

Sky

One

Sky

Spo

rts

1

Ch

ildre

n

Lei

sure

& L

ifes

tyle

Mu

sic

New

s

Fac

tual

SATELLITE

Source: BARB and Ofcom analysis. Note that the five terrestrial channels are excluded from this analysis so that the share of the remaining channels can be easily discerned. The ordering of the channels is based on EPG listings at the time of writing (June 2008). Channels may have subsequently changed positions.

130

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1 2 3 4 5 6 7 8

Entertainment cable

Factual cable

Film cableKids cable

Leisure cable

Music cable

News cable

Shopping cable

Sport cableEntertainment satellite

Factual satellite

Film satellite

Kids satellite

Leisure satellite

Music satelliteNews satellite

Sports satellite

Figure 2.78

Average channel share by platform, genre and page number

Source: BARB and Ofcom analysis. Note that the five terrestrial channels are excluded from this analysis so that the share of the remaining channels can be easily discerned. The ordering of the channels is based on EPG listings at the time of writing (June 2008). Channels may have subsequently changed positions.

131

Figure 2.79

Visitors to search sites

0

5

10

15

20

25

Apr-07 Jun-07 Aug-07 Oct-07 Dec-07 Feb-08 Apr-08

Uni

que

mon

thly

vis

its (

mill

ions

) Total search

Google search

MSN/WindowsLive search

Yahoo! search

Source: Nielsen Online, home and work use

132

Figure 2.80

Household take-up of the internet and broadband

Source: Ofcom research, Jan – Mar 2008. Base: All households (2322)

525842

5057 60 64 67

4127

114

0

20

40

60

80

100

Q4 2002 Q4 2003 Q4 2004 Q1 2006 Q1 2007 Q1 2008

Pro

po

rtio

n o

f ad

ults

(%

)

Internetconnection

Broadbandinternet

133

66%54%

40%48%

28% 24% 24%15% 10% 10% 10% 16%

3% 5% 1% 6%

18%

21%33% 14%

30%22% 16%

24%24% 24% 24% 17%

19% 13% 17% 9%

0%

20%

40%

60%

80%

100%

Em

ail

Ge

ne

ral s

urf

ing

Ma

kin

gp

urc

ha

ses

Do

wn

loa

din

gin

form

atio

n fo

rp

ers

on

al

Ba

nki

ng

Do

wn

loa

din

gin

form

atio

n fo

rw

ork

Do

wn

loa

din

gin

form

atio

n fo

rst

ud

ies

Do

wn

loa

din

gvi

de

ocl

ips/

mo

vie

s e

tcS

MS

me

ssa

gin

g/c

ha

tro

om

s

Wa

tch

ing

vid

eo

clip

s

Usi

ng

so

cia

ln

etw

ork

ing

site

s

Ga

min

g

Lis

ten

to r

ad

io

Up

loa

din

gco

nte

nt

Wa

tch

ing

TV

Re

al t

ime

ga

mb

ling

/tr

ad

ing

Additional increment of broadband subscribers (on top of dial-up proportion)Proportion of dial-up subscribers partipating in activity

Figure 2.81

Use of services among dial-up and broadband users

Source: Ofcom research, Q1 2008. Question “Which, if any, of these do you or members of your household use the Internet for while at home?”Base: Adults with broadband (1297); adults with narrowband (116)Note: The green bar denotes the additional proportion of respondents among broadband users over and above the proportion of dial-up users that claim to undertake each of the listed activities.

134

Source: Ofcom / ONS / Nielsen Online (April 2008)Note: Home use only and Ofcom calculations

19% 17%

10% 14% 15%

13% 18%21%

23%26% 17%

19%21% 24%

17%7% 6%

15%0%

20%

40%

60%

80%

100%

Share of population Share of unique audience Share of time spent online

65+

50 - 64

35 - 49

25 - 34

18 - 24

2-17

Figure 2.82

Internet unique audience and time spent online, April 2008

135

Source: Nielsen Online, Apr 08, home use only

53% 56%44% 45% 50%

71%

47% 43% 44%56% 55% 50%

29%

57%

0%

20%

40%

60%

80%

100%

All 2-17 18 - 24 25 - 34 35 - 49 50 - 65 65+

% o

f to

tal t

ime

spen

t on

line

Women

Men

Figure 2.83

Share of time spent online by age group and gender

136

0

5

10

15

20

25

Faceb

ook

eBay

Googl

e

Yahoo

!

MSN/W

indo

ws Live

BBC

YouTub

e

bebo

Fox In

tera

ctive

Med

ia

AOL M

edia

Networ

k

Virgin

Med

ia

RuneS

cape

Amaz

on

EA - Ele

ctron

ic Arts

Onli

ne

Disney

Onli

ne Sky

Wiki

pedia

Orang

e

King.co

m

Min

iClip

Total hours(millions)

Uniquevisitors(millions)

Source: Nielsen Online, April 2008* Fox Interactive Media includes MySpace

Website brands which UK audiences spend most time on

Figure 2.84

Audiences and time spent on website with the highest unique audiences

137137

68%

14% 20%

77%

18%

72%

14%

73%

0%

20%

40%

60%

80%

Awareness of VoIP Currently using

Q4 2005

Q4 2006

Q1 2007

Q1 2008

Source: Ofcom research, Jan 2008 Base: All adults with broadband

Figure 2.85

Awareness and use of VoIP

138

Figure 2.86

Functions used on the DVR

21%

28%

31%

42%

44%

45%

48%

62%

63%

73%

85%

38%

48%

53%

53%

59%

64%

64%

73%

72%

82%

89%

0% 20% 40% 60% 80% 100%

Transferred a recording from DVR to DVD/video

Recorded number of episodes and w atched in one go

Set to record a programme by clicking on the on-screen icon

Used the series linking function

Rew ound programme for reason other than to catch a highlight

Rew ound a programme to catch a highlight again

Recorded programme in order to fast forw ard and w atchhighlights only

Set to record a programme or series using the on screen guide

Paused live television

Recorded a programme and w atched it on the same day

Recorded a programme and w atched it on a different day

Ever

Regularly

Source: Ofcom research, Feb/Mar 2008. Question “DVRs allow you to record and watch programmes in several different ways and have many different functions. Which do you use regularly; by regularly I mean at least one a week”. “And which have you ever done with your DVR?”Base: All who use a DVR (246)

% o

f p

eo

ple

wh

o h

ave

use

d t

he

fo

llow

ing

fu

nct

ion

s o

n t

he

ir D

VR

139

84%80% 79%

75%

87%81% 82% 81%

86% 84% 84%79%

86%82% 83%

74%75%71%

67%61%

0%

20%

40%

60%

80%

100%

Any of these Pause live TV Rewind live TV Set up a series link torecord a whole series

of programmes

All aged 16+

16-34

35-44

45-54

55+

T6/ T7 – I’m going to read out some different types of things you can do with a TV recorder that is built-in to a digital TV service, and for each one I’d like you to say which of the options on the card applies to youBase: All adults aged 16+ with a DVR (573 aged 16+, 178 aged 16-34, 165 aged 35-44, 114 aged 45-54, 113 aged 55+)Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in October to December 2007

Figure 2.87

Interest in PVR functionality

140

Figure 2.88

Reasons for recording programmes on a DVR

83%

78%

54%

40%

18%

4%

0% 20% 40% 60% 80%

Because I am not going to be athome

Because two programmes on atsame time

Because someone else iswatching a different programme

To fast forward through adverts

To build up an archive of TVprogrammes

To record all of my TV viewing forthe week

Source: Ofcom research, Feb – Mar 2008. Question “Which of these statements apply to when and how you use your DVR to record programmes?”Base: All DVR users (237)

% of people who give reason for recording a programme

141

Fixed and broadband Y Y Y Y Y Y Y Y Y Y Y

Broadband, fixed and TV Y Y Y Y

Broadband, fixed, TV and mobile Y Y

Broadband and mobile Y Y Y Y Y Y Y

Broadband, mobile and TV Y Y

Broadband, fixed and mobile Y Y Y Y Y

Fixed and mobile Y Y Y Y Y

Fixed and TV Y Y Y Y

Fixed, TV and mobile Y Y

Fixed mobile convergence Y Y

Talk

Talk

Tesco

Tisc

ali

To

ucan

Virg

in M

edia

Vo

da

fon

e

Plu

sN

et

BS

kyB

Oran

ge

BT

AO

L

Source: PurePricingNote: Highlighted box denotes that the combination of services requires the purchase of additional services

O2

Figure 2.89

Bundling service offers from major suppliers, April 2008

142

Figure 2.90

Bundled services purchased by consumers by type

30 36 40 44 47 43

1213

18 17 18 3223 19

16 13 12215 16

13 10 8 85 4 4 4 2 113 9 12 13 1514

0%

20%

40%

60%

80%

100%

Q1 2005 Q3 2005 Q1 2006 Q3 2006 Q1 2007 Q1 2008Pro

port

ion

of b

undl

es p

urch

ased

(%

)

Other

Fixed voice, dial-up andmultichannel TV

Fixed voice and multi-channel TV

Fixed voice and dial-up

Fixed voice, broadbandand multichannel TV

Fixed voice andbroadband

Source: Ofcom research, January 2008Note: A bundled service is defined to be two or more services taken from a single provider, with or without a price discount.

143

8%

11%

10%

5%

32%

30%

16%

11%

21%

18%

10%

13%

39%

41%

64%

70%

81%

84%2%

3%

5%

9%

9%

8%

0% 20% 40% 60% 80% 100%

Use landline

Use mobile

Use internet

Listen to radio

Listen to MP3 or stereo

Play games on console

Frequently Sometimes Rarely Never

Source: Ofcom research, Feb/Mar 2008. Question “At the same time as watching TV, how frequently, if at all, do you also do any of the following?”Base: All with TV (1500)

Figure 2.91

Frequency of consuming other media while watching TV

144

0%

20%

40%

60%

80%

100%

16-19 20-24 25-34 35-44 45-54 55-64 65-74 75+

Use other media with TV

Use your mobile phone

Talk on your landline/home phone

Go on the internet

Listen to music on CD/MP3 player/ computer

Listen to a radio station

Play computer games ona games console

T3A-F – Do you ever watch TV at home and do these other things at the same time? Is that most times or sometimes when you watch TV? Base: Adults aged 16+ with any TVs (2887 aged 16+, 203 aged 16-19, 205 aged 20-24, 471 aged 25-34, 657 aged 35-44, 488 aged 45-54, 336 aged 55-64, 355 aged 65-74, 167 aged 75+)Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in October to December 2007

Figure 2.92

Frequency of using other media while watching TV, by age

145

11%

13%

13%

16%

30%

30%

21%

20%

20%

16%

14%

12%

38%

41%

52%

52%

60%

81%3%

12%

7%

21%

9%

7%

0% 20% 40% 60% 80% 100%

Use landline

Use mobile

Listen to Radio

Watch TV

Listen to MP3 or stereo

Play games on console

Frequently Sometimes Rarely Never

Figure 2.93

Frequency of using other media while browsing the internet

Source: Ofcom research, Feb/Mar 2008. Question “At the same time as being on the internet, how frequently, if at all, do you also do any of the following activities?”Base: All who use internet (983)

146

0%

20%

40%

60%

80%

100%

16-19 20-24 25-34 35-44 45-54 55-64 65+

Use other media withinternet

Use your mobile phone

Talk on your landline/home phone

Watch TV

Listen to music on CD/MP3 player/ computer

Listen to a radio station

Play computer games on agames console

IN4A-F – Do you ever use the internet at home and do these other things at the same time? Is that most times or sometimes when you use the internet? (SHOWS % STATING THEY DO THIS ‘MOST TIMES’ OR ‘SOMETIMES’)Base: Adults aged 16+ who use the internet at home (1514 aged 16+, 157 aged 16=19, 111 aged 20-24, 285 aged 25-34, 431 aged 35-44, 291 aged 45-54, 140 aged 55-64, 95 aged 65+)Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in October to December 2007

Figure 2.94

Frequency of using other media while browsing the internet, by age

147

44%

13% 12% 10% 8% 6%2% 2% 1%

52%

5%8%

13% 12%

5%1% 2% 1%

0%

10%

20%

30%

40%

50%

60%

Watchtelevision

Listen tomusic on ahi-fi/ CD/

tape player

Listen to theradio

Use a mobilephone

Use theinternet via a

computer/laptop

Readnewspapers/magazines

Watchvideos/DVDs

Listen to aportablemusic

device/ MP3player

Play console/computergames

2005 2007

A2 – Which one of these would you miss doing the most?Base: All adults aged 16+ (3244 in 2005, 2905 in 2007)Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in October to December 2007

Figure 2.95

Most missed media activity - 2005 and 2007

148

0%

20%

40%

60%

80%

16-19 20-24 25-34 35-44 45-54 55-64 65-74 75+

Watch television

Use a mobile phone

Use the internet

Listen to the radio

Listen to music ona hi-fi/ CD player

Read newspapers/magazine

Listen to a portablemusic device/ MP3player

A2 – Which one of these would you miss doing the most?Base: All adults aged 16+ (2905 aged 16+, 206 aged 16-19, 207 aged 20-24, 473 aged 25-34, 661 aged 35-44, 489 aged 45-54, 341 aged 55-64, 356 aged 65-74, 167 aged 75+)Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in October to December 2007

Figure 2.96

Most missed media activity by age

149

Figure 2.97

Proportion of children who use devices at home

Base: Parents of children aged 8-15, 2005=1536, 2007=1183, Apr 08= 743Source: Ofcom research

100%

86%

85%

84%

80%

72%

65%

56%

37%

26%

100%

93%

86%

86%

66% 73

% 76%

70%

45%

61%

100%

92%

86%

87%

56%

71% 77

%

74%

50%

61%

TV DVD player(not portable)

CD player Gamesconsole/player

Video cassetterecorder

Radio Mobile phone Laptop/ PCwith internet

Digital camera MP3 player

2005 All aged 8-15 2007 All aged 8-15 Apr 2008 All aged 8-15

150

Figure 2.98

Percentage of children who own/use devices, by age

0%

20%

40%

60%

80%

100%

5 6 7 8 9 10 11 12 13 14 15

TV

DVD player

CD player

Games console

Mobile phone

Radio

PC/ laptop withinternet

MP3 player

Child’s age in years

Source: Ofcom research, Saville Rossiter-Base, April to May 2008

151

Figure 2.99

Media activities regularly performed by children, by age

4%

31%

70%

6%13%

37%

16%

26%31%

22%

40%

66%

26%31%

40%37% 36%40%39%

56% 54%

94% 93% 94%

0%

20%

40%

60%

80%

100%

Aged 5-7 Aged 8-11 Aged 12-15

Use a mobile phone

Listen to an MP3player like an iPod

Listen to radio

Use the internet

Read magazines/comics/ newspapers

Watch videos/ DVDs

Play computer orvideo games

Watch TVActivities children claim to ‘do almost every day’ Base: Children aged 5-15 ( 282 aged 5-7, 367 aged 8-11, 376 aged 12-15)Source: Ofcom research, Saville Rossiter-Base, April to May 2008

Average no. of activities “almost every day” (out of 8)

2.4 3.2 4.8

152

60%

28%

41%

19%25%

22%

8%

60%

38%35% 33%

24%

16%10%

0%

10%

20%

30%

40%

50%

60%

Any ofthese

Watch TV Go on theinternet

Use yourmobilephone

Listen tomusic onCD/ MP3

player/computer

Talk onyour

landline/homephone

Playcomputer

games on agamesconsole

Listen to aradio

station

WhilewatchingTV

While ontheinternet

Do you ever use the (internet/TV) at home and do any of these other things at the same time? (% stating ‘most times’ or ‘sometimes’)Base: Children aged 8-15 who use the internet at home (557) and those aged 8-15 that watch TV at home (743)Source: Ofcom research, Saville Rossiter-Base, April to May 2008

Figure 2.100

Which media devices used while watching TV/on the internet

153

28%

26%

57%

47%

76%

71%

60%

60%Aged 5-15

Aged 12-15

Aged 8-11

Aged 5-7

% saying they ‘most times’ or ‘sometimes’ do any other media activities (prompted with a list) at the same time as watching TV/using internet at homeBase: Children aged 8-15 who watch TV at home (279 aged 5-7, 367 aged 8-11, 376 aged 12-15. Children aged 8-15 who use the internet at home (157 aged 5-7, 253 aged 8-11 304 aged 12-15 in 2008)Source: Ofcom research, Saville Rossiter-Base, April to May 2008

While watching TV

While on the internet

Figure 2.101

Use of more than one media type by age

154

Base: Children aged 5-15 who use the internet at home (157 aged 5-7, 253 aged 8-11, 304 aged 12-15)Source: Ofcom research, Saville Rossiter-Base, April to May 2008

21% 28

%

4% 7%

49%

3% 7%

19%

2%

63%

52%

25%

20% 28

%

49%

19%

20%

21%

9% 7% 11%

3%

80%

65%

62%

54%

47%

47%

43%

38%

24%

19%

19%

16%

11%

0%

20%

40%

60%

80%

100%

Sch

ool w

ork/

hom

ewor

k

Look

for

info

rmat

ion

abou

t th

ings

I'm in

tere

sted

in

Inst

ant

Mes

sagi

ng

Web

site

s lik

e M

ySpa

ce,

Beb

o or

Pic

zo

Site

s w

here

you

wat

ch v

ideo

,pi

ctur

es a

nd m

usic

like

You

Tub

eor

Flic

kr**

Pla

y ga

mes

onl

ine

Em

ails

Dow

nloa

d or

pla

y m

usic

Go

to T

V p

rogr

amm

e w

ebsi

tes

Site

s ab

out

new

s/ w

hat

is g

oing

on in

the

wor

ld

Go

to s

ites

whe

re p

eopl

ead

d/ch

ange

info

(bl

ogs/

Wik

is)

Web

site

s w

ith a

vata

rs,

like

Hab

boH

otel

etc

List

en t

o ra

dio

onlin

e

Aged 5-7

Aged 8-11

Aged 12-15

NA NA NA

Claimed use of search engines: 85% aged 8-1, 95% aged 12-15

Figure 2.102

Claimed use of the internet for different activities, by age

155

14%

10%

4%

8%

1%

25%

21%

8%10%

3%

0%

10%

20%

30%

Any of these On the internet On a mobilephone

On a portableplayer like a Sony

PSP

On a video iPod

Aged 8-11

Aged 12-15

Base: Children aged 8-15 (367 aged 8-11, 376 aged 12-15 )Source: Ofcom research, Saville Rossiter-Base, April to May 2008

+3

+6

+5

+xDenotes statistically significant changes since 2006

Figure 2.103

Ways of watching TV programmes/clips/films apart form TV

156

60%52%

35%30%

16%

33%

14%6%

2% 2%

86%

71%

55%48%

32% 30%24%

12%8%

3%

0%

20%

40%

60%

80%

100%

Sending orreceiving text

messages

Making orreceiving

calls

Take photos Listen tomusic

Take videosPlay games Send orreceivephoto

messages

Send orreceive video

clips

Access theinternet

Watch TVprogrammes

or clips

2008 aged 8-11 2008 aged 12-15

Base: Children aged 8-15 with their own mobile phone (213 aged 8-11, 347 aged 12-15)Source: Ofcom research, Saville Rossiter-Base, April to September 2007 and April to May 2008

+7 +

4

+9

-7

-11 -15

+11

+xDenotes statistically significant changes since 2006

Figure 2.104

Claimed use of mobile phones for different activities, by age

157

3%5%

4%4%

1%

3%2%

3%

11%

12%

25%22% 7%

34% 12%27%

3%2%

3%

12%

9%

26% 24%

62% 67%

39%51%

30% 31%

3% 9%3%5% 6% 5%

0%

20%

40%

60%

80%

100%

Boys aged5-7

Girls aged5-7

Boys aged8-11

Girls aged8-11

Boys aged12-15

Girls aged12-15

Watch TV

Use the internet

Play computer or videogamesUse a mobile phone

Read magazines/comics/ newspapersWatch videos/ DVDs

Listen to an MP3 playerlike an iPodListen to radio

None of these

% claiming they would miss the media activities the most, if it were taken away.Base: Children aged 5-15 (132 Boys aged 5-7, 150 Girls aged 5-7, 189 Boys aged 8-11, 178 Girls aged 8-11, 187 Boys aged 12-15, 189 Girls aged 12-15). Source: Ofcom research, Saville Rossiter-Base, April to May 2008

5-7 8-11 12-15

Figure 2.105

Activities children would miss the most, by age

Section 3: Television


159

UK television industry 2002 2003 2004 2005 2006 2007

Total TV industry revenue (£bn) 8.9 9.3 10.1 10.6 10.8 11.2

Proportion of revenue generated by public funds 25% 25% 23% 23% 23% 23%

Proportion of revenue generated by advertising 35% 35% 34% 33% 32% 32%

Proportion of revenue generated by subscriptions 32% 35% 35% 37% 37% 38%

TV as a proportion of total advertising spend 30.9% 30.2% 29.6% 29.6% 27.9% 26.8%

Spend on originated output by 5 main networks (£bn) 3.0 3.0 3.0 2.8 2.8 2.6

DTV take-up (% of homes in Q1) 38.5% 43.2% 53.0% 61.9% 69.7% 86.3%(Q1 2008

87.1%)

Proportion of DTV homes paying for TV (Q1) 86.6% 80.2% 71.7% 64.3% 60.0% 55.0%

Viewing per head, per day (hours) in all homes 3:34 3:44 3:42 3:39 3:36 3.38

Share of the five main networks in all homes 77.7% 76.4% 73.8% 70.3% 66.8% 63.5%

Number of channels broadcasting in the UK 236 294 379 416 433 470

UK television industry key metrics, 2002-2007

160

Source: Research from Q1 2007, platform operator data, Ofcom estimates and GfK research prior to this.

0

5

10

15

20

25

Q1 1999 Q1 2000 Q1 2001 Q1 2002 Q1 2003 Q1 2004 Q1 2005 Q1 2006 Q1 2007 Q1 2008

Digitalterrestrial only

Analoguecable

Digital cable

Free-to-viewdigital satellite

Analoguesatellite

Pay digitalsatellite

TV households (m)

80.3%71.8%62.6%54.2%46.0%44.3%40.5%32.6%26.4%

% of homes

87.2%

Data from Q1 2007 are basedon consumer research

Figure 3.1

Multichannel television take-up

161

38

96

184

244

292

358

422

465

34 4079

150167

190

262

364

0

100

200

300

400

500

Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008

Sub

scri

bers

(th

ousa

nds)

Sky HDhomes

Virgin(DVR) / V+box (HDrecorder)

Number of HDTV subscribers: Sky and Virgin Media

Source: BSkyB/Virgin Media

Figure 3.2

162

Figure 3.3

Subscription and net advertising revenue

Source: Ofcom/operators/platform operator annual reportsNote: Figures expressed in nominal terms

£428

8m

£402

9m

£389

1m

£247

6m

£204

9m £325

2m

£358

5m

£288

3m £354

4m

£348

1m

£314

7m

£347

1m

£354

8m

£346

9m

£324

2m

£338

5m

0

1000

2000

3000

4000

2000 2001 2002 2003 2004 2005 2006 2007

Subscriptions

Netadvertisingrevenue

Turnover £m

163

Figure 3.4

Net advertising revenue by sector

Source: Ofcom/BroadcastersNote: Figures expressed in nominal terms.

£2,566 £2,686

£99

£534 £676 £695 £695 £772 £809

£2,387£2,427£2,686£2,612

£270£168

£347

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

£ m

illio

ns


Commercial PSBportfolio channels

Commercialanalogue channels

£3,544m£3,469m£3,548m£3,481m£3,242m£3,147m

164

Figure 3.5

Multichannel audience winners and losers, 2006 to 2007

Source: BARBNote: Includes channel’s +1 services

C4 + S4C, -0.8%

Sky One, -0.6%

Five, -0.3%

UKTV Gold, -0.3%

Sky Movies Comedy, -0.3%

Discovery, -0.2%

Men+Motors, -0.2%

Living TV, -0.1%

Sky Movies 9, -0.1%

Sky Movies Action/Thriller, -0.1%

More 4, 0.2%

Sky Three, 0.2%

Disney Channel, 0.2%

Sky Movies Premiere, 0.2%

Dave, 0.2%

ITV2 0.2%

Virgin 1, 0.2%

Fiver, 0.3%

FilmFour, 0.5%

Five US, 0.5%

-0.9% -0.8% -0.7% -0.6% -0.5% -0.4% -0.3% -0.2% -0.1% 0.0% 0.1% 0.2% 0.3% 0.4% 0.5% 0.6%

Percentage point change in audience share

165

Figure 3.6

PSB and portfolio channel shares in multichannel homes

Source: BARB

58.4% 57.2% 57.5% 57.7% 57.6% 56.7%

7.3% 7.4% 9.2% 11.3% 13.6%

35.3% 35.6% 35.1% 33.1% 31.2% 29.7%

6.2%

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Other digitalchannels

PSB portfoliochannels

PSBChannels

Audience share

166

Source: BARBNote: average weekly reach – 15 minute consecutive – full weeks

18.819.2

18.2 18.3 18.117.6

16

17

18

19

20

2002 2003 2004 2005 2006 2007

80

82

84

86

88Hours viewed per week

Average weekly reach (%)

Hours watched per week (total TV) Average weekly reach (%)

Figure 3.7

16-24’s TV viewing hours and weekly reach in all homes

167

0%

2%

4%

6%

8%

May02

Nov02

May03

Nov03

May04

Nov04

May05

Nov05

May06

Nov06

May07

Nov07

May08

E4

ITV2

BBC3

Sky One

Dave

Fiver

Audience Share

Figure 3.8

Audience share of the most popular channels: 16-24s


168

Figure 3.9

Age profile of channels targeted at younger viewers: May 2008

25.9%14.8% 17.5% 18.9% 13.2% 14.9%

16.5%22.7% 21.4%

19.6% 19.9%

16.5%

22.2%

20.9% 19.1%23.1% 18.8%

12.4%

16.6%13.3% 14.9% 18.8%

16.3%

10.3%8.3% 10.1%

11.5%

8.8%

9.3% 10.0%

23.6%

5.9%4.6%

6.0%4.8%3.0%

9.2%3.3%

12.7%16.8%10.4%13.7%

0%

20%

40%

60%

80%

100%

E4 ITV2 Sky One BBC3 Dave Fiver

Children

Adults 65+

Adults 55-64

Adults 45-54

Adults 35-44

Adults 25-34

Adults 16-24

Audience share


169

0

0.1

0.2

0.3

0.4

0.5

Janu

ary

06

Mar

ch 0

6

May

06

July

06

Sep

tem

ber 0

6

Nov

embe

r 06

Janu

ary

07

Mar

ch 0

7

May

07

July

07

Sep

tem

ber 0

7

Nov

embe

r 07

Janu

ary

08

Mar

ch 0

8

May

08

Challenge TV +1

ITV2 +1

More4 +1

DMAX

DMAX +1

Men+Motors

Trouble

Bravo 2

Trouble moved from Children's to Entertainment

More4+1 joined theChannel 4 cluster

ITV2+1, DMAX and DMAX+1 move up the EPG. Men&Motors, Challenge+1

and Bravo 2 move down.

Figure 3.10

EPG changes

170

29 33 43 50 50

109134 126

93

1236

25

1726

117114 120143

109

0

50

100

150

200

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Overseaslicences

UK licences

Source: Ofcom Note: For years with purple bars, no distinction is made between UK licences and overseas licences.

Number of licences issued

Figure 3.11

Licences issued by Ofcom and the ITC

171

AdultEntertainment

FactualMulticultural

Music

HD channels

Movies

Sport

Children's

Shopping

Interactive User-generatedSelf promotion

Religious

24

34

8

9

5

6

3

6

5

7 4

3 1 2

Source: Ofcom

Figure 3.12

UK television licences awarded, by genre: 2007

Breakdown of licences(Total licences: 117)

3.2: The TV industry

173

2,049 2,476

2,883

3,2523,585

3,8914,029

4,288

3,471 3,3853,147

3,2423,481 3,548

3,469

3,544

1,8201,934

2,216 2,302 2,319 2,433 2,521 2,615

397781

650 534746 749 794

775

0

1,000

2,000

3,000

4,000

5,000

2000 2001 2002 2003 2004 2005 2006 2007

Subscriptions

Net advertisingrevenue

Licence feeallocated to TV

Other

£8,576m £10,130m£8,895m £10,621m£9,330m £10,813m£7,737m £11,222m

Figure 3.13

Total TV industry revenue, by source

£m

Source: Ofcom/broadcastersNote: Figures expressed in nominal terms. ‘Subscriptions’ includes Ofcom’s estimates of BSkyB and Virgin Media television subscriber revenue. ‘Other’ includes TV shopping, sponsorship, interactive (including premium rate telephony services), programme sales and S4C’s grant from the DCMS. The licence fee figure for 2006 has been re-stated owing to a change in the way the BBC reported its figures, which allocates a greater proportion of overheads to specific services.

174

Figure 3.14

Total TV industry revenue by sector

£m

Source: Ofcom/broadcastersNote: Figures expressed in nominal terms. Commercial analogue channels comprise ITV1, Channel 4, Five and S4C. Commercial multichannels comprise all commercial channels other than ITV1, Channel 4 and Five. Publicly-funded channels comprise BBC One, BBC Two, the BBC’s portfolio of digital-only television channels and S4C. S4C is listed under publicly-funded and commercial analogue channels because it has a mixed advertising and public funding model. The publicly-funded channels figures for 2006 and 2007 have been restated owing to a change in the way the BBC reported its licence fee figures.

1,911 2,309 2,396 2,414 2,528 2,612 2,709

2,981 2,716 2,677 2,907 2,717 2,611

1,397 1,0051,295 1,455 1,614

2,028

2,6752,844

795 987 1,287

4,2884,0293,891

2,0492,476 2,883 3,252

3,585

0

2,000

4,000

6,000

8,000

10,000

12,000

2000 2001 2002 2003 2004 2005 2006 2007

Platform operators



Publicly-fundedchannels

£8,576 £10,130£8,895 £10,621£9,330 £10,813£7,737 £11, 222

175

£2,566 £2,686

£99

£534 £676 £695 £695 £772 £809

£2,387£2,427£2,686£2,612

£270£168

£347

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007


Commercial PSBportfolio channels


£3,544m£3,469m£3,548m£3,481m£3,242m£3,147m

Figure 3.15

Net advertising revenue by sector

Source: Ofcom/Broadcasters.Note: CAGR for commercial analogue channels is calculated over a five year period

£m

176

Figure 3.16

TV advertising market share, 2007

Source: Ofcom/Broadcasters

Total NAR = £3,544m(2006 figures in brackets)

Channel 419.2%

Other32.6%

Five8.1%

(8.2%)

ITV138.5%

GMTV11.5%

(1.6%)

(40.9%)

(30.0%)

(19.2%)

177

Other revenue£111m

Programme sales£32m

Other public funding (S4C) £94m

Sponsorship£191m

Pay-per-view£100m

Interactive services£95m

TV shopping£152m

Figure 3.17

Breakdown of non-broadcast revenue, 2007


Total non-broadcast revenue = £775m

178

Source: Ofcom/Broadcasters Note: Includes first-run in-house, commissioned and acquired

Music£104m

Leisure£72m

Factual£168m

Children's£181m

News£108m

Sport£1,413m

Entertainment£859m

Total spend = £2,905m

Figure 3.18

Revenue by multichannel operators in key channel genres

179

20072006

£1,305m7

£1,430m

£3,734m3

£3,668m

Channel packagers

Channels

Government

Advertisers & sponsors

Viewers

Subscribers

In-house producers

External producers and rights holders

£4288m1

£4,029m

£2,962m2

£2,853m

£94m4

£91m

£4

04

m5

£4

54

m £3,321m6

£3,077m

£4,626m

£4,507m

+6.4%

3.2%

1.8%

3.8% -11%

+1.4%

7.9%

-8.7%

Figure 3.19Simplified flow of funds in the TV industry, 2007 (2006 in italics)

Source: Broadcasters, broadcaster results and Ofcom analysis*BBC figure is preliminaryNotes:1. Excludes all revenue flows to channels owned by vertically integrated broadcasters (BSkyB and Telewest)2. Includes both UK and non-UK content and rights providers3. All figures are nominal4. Spend on output includes multichannel spend on repeats. 5. The bold figures represent 2007, the italicised figures 20066. Includes Entertainment, Leisure, Factual, Kids, News, Movies and Sport

2.7%

180

Source: Ofcom/BroadcastersNote: Note: The first-run figures include in-house productions and external commissions, not first-run acquisitions. GMTV is included within the figures for the five main channels

Proportion of hours by operator (percent)

42,66522,189

12,856

11,952

1,012,297

58,401

33,14812,728

0%

20%

40%

60%

80%

100%

Total hours of output Total hours of first-run originations

Other digitalchannels

Programmes forNations & Regions

BBC digitalchannels

Main five channels(network)

Total hours = 1,100,838 First run = 105,398

Figure 3.20Total and first-run originated hours of output, 2007

181

Figure 3.21

Spend on programmes

Source: Ofcom/BroadcastersNote: Figures expressed in nominal terms. Figures do not include spend on nations and regions output.

£m

£802m£841m£800m

£378m£351m£368m

£838m £840m£868m

£492m £510m £529m£191m£191m£190m£224m£225m£262m

£820m£762m£653m

£1,166m£1,101m £1,088m

0

1,000

2,000

3,000

4,000

5,000

2005 2006 2007

Movies/sport channels

Digital-only commercialchannels

BBC digital channels

Five

Channel 4

ITV1 + GMTV1

BBC Two

BBC One

£4,705m

£4,835m

£4,950m

182

Figure 3.22

Hours of first-run output on the five main channels


Transmitted hours

5,712 5,491 5,610 5,533 5,543

15,936 15,733 15,142 16,646

13,00612,169

11,952

5,695

16,321 16,021

14,496 13,425 11,919

0

10,000

20,000

30,000

40,000

2002 2003 2004 2005 2006 2007

Regional

Non-peaknetwork

Peak-timenetwork

36,144 35,022 33,649 32,921 33,473 34,141

183

Figure 3.23

Spend on first-run originated output on the five main networks

Source: Ofcom/BroadcastersNote: Figures are expressed in 2007 prices.

£m

£1,482 £1,462 £1,452 £1,468 £1,428

£708 £704 £662 £595

£407 £360£254

£427 £406 £395£369 £338

£327

£1,484

£645£681

£300£392£417

0

1,000

2,000

3,000

2002 2003 2004 2005 2006 2007

Regional

Late night

Day time

Peak time

£3,035m £2,978m £2,953m £2,843m £2,750m £2,604m

184

£248 £248 £260 £261 £266 £259 £265 £258

£62 £64 £68 £63 £70 £69£48

£26 £28 £29 £31 £29 £30 £28 £27

£63£69

£38

£71£77£80£73 £75 £82

0

100

200

300

2000 2001 2002 2003 2004 2005 2006 2007

Peak-time

Day-time

Late night

Regional


Figure 3.24

CPH for first-run originated content on the five main networks

Cost per hour (£k)

185

25 25 26 25 26

18 19 21 21 21

26 25 25 25 25

25 23 21 22 22

15 13 14 13 12

7365 72 62 64

0

50

100

150

200

2003 2004 2005 2006 2007

Ho

urs

pe

r w

ee

k

BBC digitalchannelsFive

Channel 4

ITV1+GMTV1

BBC Two

BBC One

Figure 3.25First-run originated output by the PSBs in peak time and all day

109 104 103 99 105

62 64 68 70 68

101 100 95 105 119

80 69 66 65 63

71 69 65 74 71

288274 269 261 247

0

200

400

600

800

2003 2004 2005 2006 2007

Ho

urs

pe

r w

ee

k

BBC digitalchannelsFive

Channel 4

ITV1+GMTV1

BBC Two

BBC One

75.6 78.6 78.9 74.6 70.9 167.7 178.0 167.6 179.6 172.1

All day real cost/hour (£k, 2007 prices) Peak cost/hour (£k, 2007 prices)


186

Figure 3.26

PSB genre mix in peak time

Source: Ofcom/BroadcastersNote: Figures do not include spend on nations and regions output.

Proportion of total hours

935 835 785 788 792255 296 318 303

1,814 2,015 2,105 2,253 2,149 2,370

2,077 2,070 1,863 1,935 1,954 1,952

947 937 757 688 579 618

1,334 1,330 1,395 1,268 1,277

530 362 401 341 507 366

917318284

1,362

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Sport

Light Entertainment &Modern MusicFilms

Drama

Education

General Factual

Religious

Children's

Arts & Classical Music

Current Affairs

News

8,178 7,933 7,936 7,929

7,923

8,153

187

Figure 3.27

PSB genre mix in daytime

807 379 384 451

2,833 3,165 3,150 3,512 3,744

918 694 738 821 816 8102,294 2,031 2,056 1,797 2,654

1,959 2,069 2,080 2,4641,811

2,448 2,665 2,810 2,713 2,491

2,193 1,832 1,837

2,753 3,299 3,191 3,041 3,0682,939

460830

4,2754,3334,5754,9065,0554,856

4,368

2,759

1,716

2,370

1,6871,7531,958

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Sport

Light Entertainment &Modern MusicFilms

Drama

Education

General Factual

Religious

Children's


Current Affairs

News

Source: Ofcom/BroadcastersNote: Includes five main channels plus GMTV1. Figures do not include spend on nations and regions output.

Proportions of total hours

188

Figure 3.28The BBC’s digital channels genre mix (all day)

Source: Ofcom/BroadcastersOther includes: Education, Drama, Film, Religion and Sport

1,478 1,360 1,0771,306 1,143 1,260 1,386

1,747 1,751 1,738 1,690 2,374

16,74016,66117,674

8,500

17,890

8,589

7,494

1,168340225

8,837

1,211

8,033 8,3267,9837,990 8,021 7,957

2,3351,656 1,615 2,297 2,482 2,5031,0481,3401,2421,7431,993

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Other

Light Entertainment &Modern Music


General Factual

Children's

Current Affairs

News

29,832

£210m

31,421

£245m

32,792

£254m

32,839

£282m

Output (hrs)

Investment (£m)

32,986

£235m

33,353

£224m

1,203

189

Figure 3.29

Hours of output on channels available on multichannel platforms


Music24%

Leisure6%

News5%

Sport13% Factual

15%

Children's11%

Entertainment26%

Total broadcast hours in 2007 = 1,012,297 (2006 = 945,003)

190

Figure 3.30Multichannel first-run originations and acquisitions

Source: Ofcom/Broadcasters Note: Includes first-run in-house, commissioned and acquired content

Music2%

Leisure2%Factual

5%Children's7%

News23%

Sport38%

Entertainment23%

Total originated hours in 2007 = 101,952

191

Figure 3.31Content spend by multichannel operators in key channel genres


£m

£896m

£435m

£104m£47m£43m£23m

£32m

0

500

1,000

1,500

2,000

2007

Music

Leisure

Factual

Children's

News

Entertainment

Sport

£1,579m

192

Source: Ofcom/broadcasters

£133£394£284£406

£1,897

£7,070

£1,623

£439£1,240£1,117

£1,561

£1,978

£11,155

£3,205

£0

£2,000

£4,000

£6,000

£8,000

£10,000

£12,000

Sport Entertainment News Children's Factual Leisure Music

Spend per hour

Revenue per hour

Figure 3.32 Cost per hour of multichannel operators’ spend and revenue

193

Source: Ofcom/BroadcastersNote: Figures expressed in nominal terms. First-run network commissions including news and sports rights. BBC Multichannels included in the chart: BBC Three, BBC Four, CBBC, CBeebies

£165m £218m

£98m £109m

£274m

£380m £377m

£561m £513m

£212m

£419m

£99m £69m

£229m

£487m

£59m £96m

£88m£109m

£292m

0

200

400

600

800

2006 2007 2006 2007 2006 2007 2006 2007 2006 2007 2006 2007

External commissions

Internal commissions

Investment (£m)

BBC1 BBC2 ITV1 Channel 4 Five BBCmultichannel

Figure 3.33Spend on first run commissions by PSBs: 2006 & 2007

194

Source: Pact Independent Production Census 2007/08. Data collated and analysed by Digital-i

£1,400m

£1,890m

£105m

£242m

£1,750m

£199m

0

500

1000

1500

2000

2500

2005 census 2007 census 2007/08 census

Non-TV activities

Television

£m

Figure 3.34Independent producers’ sources of UK television revenue

195

Source: Pact Independent Production Census 2007/08. Data collated and analysed by Digital-i

£16m£103m

£45m£31m£135m

£15m£43m£146m

£15m

£1140m£1170m

£1350m

0

500

1000

1500

Pre-Production Primary TV Rights Secondary TV andAdditional Rights

Other TV

2005 Census

2007 Census

2007/08Census

£m

Figure 3.35

Value of UK commissions, by broadcaster

196

Figure 3.36Value of UK commissions by broadcaster

Source: PACT/Digital-i

£3

58

m

£2

85

m

£3

07

m

£9

9m

£3

51

m

£3

11

m

£3

03

m

£7

9m

£1

12

m

£4

18

m

£3

87

m

£2

87

m

£7

1m £1

49

m

£4

8m

£5

0m

£3

4m

£3

4m

£0m

£100m

£200m

£300m

£400m

£500m

BBC ITV Channel 4 Five Multichannels S4C

2005 census

2007 census

2007/08 census

Commissions £m

197

Figure 3.37

Percentage and number of independent production companies by broadcaster

Source: Broadcast

Percentage of qualifying programmes by volume

35%

87%

50%

10%

87% 90%

18%

39%

96%

0%

25%

50%

75%

100%

Percentage of hours

BBC ITV1 Channel 4 Five Animal Planet Discovery Sky One Virgin UKTV

84

312

108

3010

30 19 22

279

0

50

100

150

200

250

300

350

Number of independents

Number of indies commissioned

198

Company Revenue Key shows

1 IMG Media £221.7m The One Show, Robin Hood, An Island Parish, The Catherine Tate Show

2 All3Media UK £202.5m Midsomer Murders, Formula One, Fifth Gear, 10 Years Younger, Richard & Judy

3 Endemol UK £160.0m Big Brother, Ready Steady Cook, Deal or No Deal, Brainteaser

4 Shine £146.0m Celebrity Masterchef, The Wright Stuff, Life On Mars, Spooks

5 Hit Entertainment £142.7m Bob The Builder, Project Build It, Barney & Friends, Wobblyland

6 Talkback Thames £140.0m Britain's Got Talent, The X-Factor, The Bill, Grand Designs

7 RDF Media Group £99.3m Wife Swap, Location, Location, Location, Faking It

8 Shed Media £71.8m Waterloo Road, Supernanny, Who Do You Think You Are?, New Tricks

9 Tinopolis £66.0m Question Time, The Government Inspector, Traffic Cops, Car Wars

10 DCD Media £42.0m House Price Challenge, Saturday Cooks, The Wind in the Willows

Source: Broadcast Indies 2008 Survey

Figure 3.38

Top ten holding companies and independents by revenue: 2007

199

Holding company Production companies

All3Media South Pacific Pictures, North One TV, Lion TV, Lime Pictures, IDTV, Company Pictures, ARG TV, Cactus Films, All3Media International, Bentley Productions, Maverick Media, MME Moviement, Objective Productions*

IMG TWI, Tigress Productions, Tiger Aspect, Darlow Smithson Productions

RDF Media Group Plc Touchpaper Television, RDF Media, RDF International, Radar TV, IWC Media, The Comedy Unit, Presentable, Foundation TV Productions

Southern Star Group Oxford Scientific Films, Darrall Macqueen, Carnival Films & Television

Tinopolis Venner TV, Mentorn, Folio, Sunset & Vine Productions, Music Box, Tinopolis, Video Arts Group*, APP Broadcast*

Shed Productions Plc Shed Productions, Ricochet, Outright Distribution, Twenty Twenty Vision*, Wall to Wall*

ITV Productions 12 Yard Productions*

Endemol UK Endemol, Cheetah, Initial, Zeppotron, Brighter Pictures, Showrunner, Hawkshead, Victoria Real

Fremantle Media (RTL Grp) Fremantle Media, Talkback Thames, Grundy Productions, Regent Productions

DCD Media Box TV, Done and Dusted, Iambic Productions, Prospect Pictures*, September Films*, West Park Pictures*

Hit Entertainment Hit Entertainment, Gullane Entertainment, Hit USA Production, Guinness World Records

Mediaset, de Mol Endemol*

Ten Alps Plc Blakeway/3BM, Brook Lapping, Ten Alps TV, Production Co*

The Zodiak TV Group Bullseye TV*, Diverse Productions UK and US* [plus non-UK companies]

Two Way Traffic Celador International

Shine Shine, Firefly, Kudos, Princess

Figure 3.39

Continued consolidation in the independent production sector

200


5%

25%

5%

6%

10%17%

5%

27%

Entertainment

Drama

Factual

Factual Entertainment

Hobbies/Lifestyle

Children's

Sport

Other

Proportion of independent hours

Figure 3.40PSB independent commissions by genre, 2007

201


Figure 3.41PSBs external commissioning patterns 2006 & 2007

10%15%

56% 55%

25% 27% 23% 28%

6%

8% 7%19%

19%

18% 19%

15% 14%

20% 16%11%

23% 21%

11%

9%

8%20% 19% 20%

48% 45%

5%6%

7%

15%

7%4%

5%

3%

12%18%

4%4%

3%

7%6%

18%

4%6% 6%6%6% 6% 3%

0%

20%

40%

60%

80%

100%

2006 2007 2006 2007 2006 2007 2006 2007

Other

Sport

Children's

Hobbies/Lifestyle

Factual Entertainment

Factual

Drama

Entertainment

Proportion of independent hours

BBC ITV1 Channel 4 Five

202

Figure 3.42

Independent production 2005 to 2007

Source: Broadcaster returns

39%

33%

87%

88%

25% 31%

18%

81%

74%

30% 43

%

84% 94

%

24% 36

%

20%

84% 92

%

33% 42

%

35%

87% 96

%

31% 42

%

24%

87%

91%

28% 40

%

0%

25%

50%

75%

100%

BBCOne

BBCTwo

ITV1 Channel4

Five BBCOne

BBCTwo

ITV1 Channel4

Five

2005

2006

2007

Percentage of qualifying independent production by volume

All day Peak time

203

Figure 3.43

Independent productions by day part 2007


31

% 42

%

26

%45

%

38

% 57

%

24

% 34

% 50

%

82

%

87

%

94

%

96

%

94

%

91

%

10

0%

98

%

35

%

42

%

29

%

0%

25%

50%

75%

100%

Day-time Peak-time Post-peak Night time

BBC One BBC Two ITV1 Channel 4 Five

Percentage of qualifying programmes by broadcaster by volume

204

Source: PACT/Digital-i

Figure 3.44

Location of Independents’ basesWales5.0%

Northern Ireland3.0%

London (Inside M25)62%

Outside M25 38%

Midlands & East 5%

South 12%

North 7%

Scotland 6%

Wales 5%Northern Ireland 3%

205

Breakdown of expenditure on production in the nations and regions


Figure 3.45

Expenditure on first-run original production

£564m

£86m£210m

£69m

£27m

£18m

£2m£976m

£657m£120m

£22m£956m

£25m£123m

£6m

£3m

0%

20%

40%

60%

80%

100%

Total London Midlands/East

North South Scotland Wales N.Ireland

Independent

In-house

£1,221m £111m £333m £189m £49m £24m £5m£1,932m

206

Breakdown of volume of production in the nations and regions


Figure 3.46

4,731463 1,773

413

132

82

7

7,601

23

481,385380

10,083 160

1,494

6,593

0%

20%

40%

60%

80%

100%

Total London Midlands/East

North South Scotland Wales N.Ireland

Independent

In-house

17,684 11,324

Hours of first run original productions

Total Hours 843 3,158 1,907 292 130 30

207

Source: Ofcom/Broadcasters Note: BBC figures include programmes made or commissioned for other BBC channels except for BBC Three and BBC Four where programmes first shown on another BBC PSB channel are excluded.*BBC Three and Four peak-time hours are 19:00 – 24:00

70%

70% 80

%

70%

70% 80

% 90%

90%

65%

60%

53%

80% 90

%

80%

70%

50%

85%

70%

42%

90%

85%

83%

81%

75%

75%

79% 97

%

98%

90%

64%

56%

98%

99%

95%

70%

63%

95%

76%

42%

100%

0%

20%

40%

60%

80%

100%

BB

C O

ne

BB

C T

wo

BB

C T

hree

BB

C F

our

CB

BC

CB

eebi

es

BB

C N

ews

24

BB

C P

arlia

men

t

ITV

1

Cha

nnel

4

Fiv

e

S4C

BB

C O

ne

BB

C T

wo

BB

C T

hree

BB

C F

our

ITV

1

Cha

nnel

4

Fiv

e

S4C

Quota Achieved 2007

All day Peak time

% Hours

Figure 3.47Broadcasters’ performance against original production quotas

208

Performance against the Out-of-London production quotas

Source: Broadcaster returnsNote: Figures for 2006 have been restated following Ofcom’s audit of out-of-London production

Figure 3.48

50%

30%

10%

25%

50%

30%

10%

32

% 37

%

21

% 30

%

50

%

40

%

22

%

33%

44%

35%

33%

32%

53%

43%

15%

30%

46

%

0%

10%

20%

30%

40%

50%

60%

All BBC ITV1 Channel 4 Five All BBC ITV1 Channel 4 Five

Quota

Achieved 2006

Achieved 2007

Percentage of network production produced outside London, by value and by volume

Value Volume

209

Breakdown of expenditure on production by broadcaster

Source: Broadcaster returnsNote: Figures for 2006 have been restated

Figure 3.49

17.6% 17.3% 9.7% 10.2%

12.8%

0.5%0.3% 0.1%

66.9%78.7%

64.7%62.8%55.7%54.4%

67.4%67.6%63.3%63.3%

5.7%4.1%

2.0% 2.1%5.9%5.2%

8.4% 9.2%

12.8%

15.4%

3.0%

18.5%19.9%

2.7%

30.8% 29.4%

5.3%12.1%

3.7%4.6%

12.0%10.5%12.7%9.6%8.9%

2.3%1.7%2.6%2.0%1.7%3.3%3.5%2.6%

2.6%

0.5%0.2%1.3%

1.5%0.1%2.6%3.2% 0.2%0.4%0.3%0.2%

0%

20%

40%

60%

80%

100%

2006 2007 2006 2007 2006 2007 2006 2007 2006 2007

Northern Ireland

Wales

Scotland

Southern England

Northern England

Midlands & East

London

Percentage of production by value

BBC ITV1 Channel 4 FiveTotal PSBs BBC

210

Source: Broadcaster returnsNote: Figures for 2006 have been restated

Figure 3.50

BBC

Breakdown of production volume, by broadcaster

14.5% 17.9%9.7%

6.6%

16.3%

0.2%0.2% 0.1%

84.6%77.6%

57.3%60.1%

46.9%49.7%

68.1%69.9%64.3%66.0%

4.4%5.8%

1.6%0.5%

4.8%5.9%

4.2%2.9%

6.2%

7.1%3.3%

23.5%22.0%

7.3%

26.0%43.7%

8.7% 4.6%6.0%

19.3%14.6%10.0% 13.3%10.8%12.1%

0.2%1.5%1.4%

0.4%0.6%

3.2%2.9%1.7%1.6%

0.2%0.8%0.7%

0.9%1.5%1.5%1.5% 0.2%0.4%0.3%0.2%

0%

20%

40%

60%

80%

100%

2006 2007 2006 2007 2006 2007 2006 2007 2006 2007

Northern Ireland

Wales

Scotland

Southern England

Northern England

Midlands & East

London

ITV1 Channel 4 FiveTotal PSBs BBC

Percentage of production by volume

211

Figure 3.51Qualifying hours commissioned from independent producers


82

%

59

%

43

%

84

% 94

%

39

%

33

% 42

%

35

%

87

% 96

%

83

%91

%

33

%39

%

27

%

30

%

87

%

84

%

88

%

31

%

28

% 39

%

33

%

83

%

40

%

30

%

35

%

0%

20%

40%

60%

80%

100%

All BBC BBC One BBC Two ITV1 Channel 4 Five S4C

2004200520062007

Quota = 25%

% of qualifying hours

212


Figure 3.52Qualifying independent commissions by genre

43

%

44

%

76

%

98

%

58

%

82

%

85

%

30

%

99

%

10

0%

35

%

99

%

98

%

27

% 40

%

10

0%

44

%

25

%

96

%

85

%

53

%

42

%

99

%

10

0%

86% 10

0%

23

%

11

%

45

%

10

0%

6%

81

%

99

%

10

0%

24

%

52

%

10

0%

93

%

52

%

78

%

72

%

10

0%

21

%2

6%

5%

58%65

%

0%

20%

40%

60%

80%

100%

All BBC ITV1 Channel 4 Five

Ent Comedy Drama Sport C.Affairs Factual Factual Ent Hob/Leisure Arts Music Religion Children's

% of qualifying hours

213

Figure 3.53

Peak-time qualifying hours commissioned from independents

Source: Ofcom/Broadcasters Note: excludes regional programmes

21

%

18

%

73

%

73

%

25

%

31

%

18

%

81

%

74

%

36

%

20

%

84

% 92

%

31

% 42

%

24

%

87

%

91

%

32

%

24

%

0%

20%

40%

60%

80%

100%

BBC One BBC Two ITV1 Channel 4 Five

2004

2005

2006

2007

Proportion of peak-time hours

214

All day Peak time

1,3

80

36

5

40

8

27

5

1,5

08

38

5

31

1 61

9

28

1

1,4

67

46

5

31

9 47

8

23

0

29

344

4

31

5 45

9

24

8

28

0

16

20

38

8

31

2 45

1

23

2

27

8

20

0

20

8 10

0

12

5

15

0

20

8

20

0 13

7

17

1

15

021

3

11

9

13

5

16

9

21

7

1,5

72

21

0

18

0

11

5

12

8 17

8

12

620

9

12

9

0

500

1,000

1,500

BBCOne

ITV1 Channel4

Five S4C BBCOne

ITV1 Channel4

Five S4C

Quota 2007 Achieved 2004 Achieved 2005 Achieved 2006 Achieved 2007

Hours per year

Figure 3.54

Performance against News quotas, all day and peak time


215

Figure 3.55Performance against Current Affairs quotas, all day and peak time

36

5

78

20

8

13

0

60 10

5

43

4

90

21

2

23

8

77 11

7

43

3

93

21

5

24

8

71 11

0

12

6

45

6

87

21

9 33

6

81 11

3

59 11

9

46

3

83

24

0 33

5

85 11

2

55 12

2

8035

30

10

104

4

11

7 41

144

5 45

42

15

10

56

0

100

200

300

400

500

BBCOne &Two

ITV1 Channel4

Five S4C BBCOne &Two

ITV1 Channel4

Five S4C

Quota Achieved 2004 Achieved 2005 Achieved 2006 Achieved 2007

Hours per year

All day Peak time


216

The ITV1 licensees’ performance, England06

:50

05:3

8

06:5

0

06:5

0

06:5

0

06:5

0

06:5

0

06:5

0

06:5

0

07:1

5

07:1

4

05:3

8

07:1

7

07:1

6

07:1

7

07:1

7

07:1

3

07:1

5

07:1

8

06:3

9

06:0

3

06:4

0

05:2

9

06:4

1

06:4

0

06:4

2

06:4

1

06:4

1

06:3

8

06:4

0

06:1

8

05:4

2

06:1

7

05:3

2

06:1

7

06:1

6

06:1

8

06:1

8

06:1

8

06:1

8

06:1

7

06:5

0

05:2

806

:25

00:00

04:00

08:00

An

glia

Bo

rde

r

Ce

ntr

al

Ch

an

ne

l

Gra

na

da

We

st

Lo

nd

on

Me

rid

ian

Tyn

e T

ee

s

We

stco

un

try

Yo

rksh

ire

Quota 2007 Achieved 2005 Achieved 2006 Achieved 2007


Average hours of regional programming per week

Figure 3.56

217

The ITV1 licensees’ performance, Nations0

9:2

0

09

:20

09

:20

09

:57

09

:41

10

:16

09

:17

09

:13

08

:59

09

:17

08

:57

08

:56

08

:38

09

:04

09

:20

07

:29

00:00

04:00

08:00

12:00

ScotlandCentral

Scotland North Wales UTV

Quota 2007 Achieved 2005 Achieved 2006 Achieved 2007

Source: Broadcaster returnsNote: From July 2005 the Stv quota for non-news output was shared between the Scotland Central and North licensees.

Average hours of regional programming per week

Figure 3.57

218

The BBC’s performance against regional programming quotas

3,9

20

2,0

10

6,8

15

2,1

56

7,0

48

4,6

56

2,2

17

7,0

73

4,6

22

2,2

45

7,2

26

4,7

69

2,2

90 1,0

30

6,5

80

1,0

69

4,40

0

1,0

84

1,1

48

1,1

45

0

2,000

4,000

6,000

8,000

All regional programming BBC One regional news BBC One regional news inpeak

Regional programming inpeak excl. news on BBC

One

Quota Achieved 2004 Achieved 2005 Achieved 2006 Achieved 2007


Figure 3.58

219

Figure 3.59

Proportion of repeats 2007

Source: Ofcom/Broadcasters Note: Excluding programmes first shown on another PSB channel•Excluding schools programmes **BBC Three and Four peak time hours are 19:00 – 22.30

46

8276 76

95

23

44 43

54

25

42

8076

9195

23

45

28

46

56

0

25

50

75

100

BBC One

BBC Two

BBC Thr

ee

BBC Fou

r

CBBC

Cbeeb

ies

ITV1

*Cha

nnel

4Five

S4C

2006 2007% repeats

All day Peak time

23

48

32

9

1929

34

7

22

43

32

10

21

33

9

33

BBC One

BBC Two

BBC Thr

ee**

BBC Fou

r**IT

V1

Chann

el 4

FiveS4C

2006 2007

220

Figure 3.60Performance against European programming requirements, 2007


50

%

78

%

84

%

91

%

95

%

80

% 93

%

10

0%

91

%

72

%

59

%

98

%

30

%

26

% 41

%

26

%

27

% 37

%

19

% 34

%

58

%

53

%

82

%99

%

92

%

10

0%

96

%

91

%

56

%

10

0%

94

%

85

%

45

%

72

%

10

% 50

%

0%

20%

40%

60%

80%

100%

Targe

t

BBC One

BBC Two

BBC Thr

ee

BBC Fou

r

CBBC

CBeebie

s

BBC New

s 24

ITV1

(exc

l. GM

TV1)

Chann

el 4

FiveS4C

European programmes European independents Recent works

Proportion of transmitted programmes (%)

3.3: The TV viewer

222

Source: Ofcom residential tracker

Figure 3.61

Availability of television platforms

99% 98%

73%

49%

0%

20%

40%

60%

80%

100%

Analogue terrestrialtelevision

Digital satellitetelevision

Digital terrestrialtelevision

Cable television

Proportion of population covered (%)

223

Source: Ofcom, Sky, Virgin Media, GfK research from Q1 2007 onwards; previous quarters use platform operator data, research and Ofcom estimatesNote: Digital terrestrial relates to DTT-only homes

0

5

10

15

20

25

Q1 1999 Q1 2000 Q1 2001 Q1 2002 Q1 2003 Q1 2004 Q1 2005 Q1 2006 Q1 2007 Q1 2008

Digitalterrestrial only

Analoguecable

Digital cable

Free-to-viewdigital satellite

Analoguesatellite

Pay digitalsatellite

TV households (m)

80.3%71.8%62.6%54.2%46.0%44.3%40.5%32.6%26.4%

% of homes

87.2%

Data from Q1 2007 are basedon consumer research

Figure 3.62 Take-up of multichannel television on main sets

224

Source: Pay platform additions based on quarterly BSkyB and Virgin Media results. Free platform additions (DTT and free satellite) based on GfK research.Note: ‘DTT-only additions’ are first time DTT acquirers who have no other multichannel platform in the home.

Figure 3.63

DTT, satellite and cable net additions, year to Q1 2008

225332

125

1273

0

500

1000

1500

DTT-only additions Pay-satellite additions Free-to-air satelliteadditions

Cable additions

Subscribers / Households added (thousands)

225

Source: GfK research for Q1 2008Note: figures may not add up to 100% owing to rounding.

Figure 3.64

Platform share among main TV sets Q1 2008

Free-to-view satellite

3%

Pay satellite34%

Digital terrestrial38%

Analogue terrestrial13%

Cable13%

ADSL 0.2%

Total TV homes = 25.5 million

226

Source: GfK research for Q1 2008Note: figures may not add up to 100% owing to rounding.

Figure 3.65

Platform share among all TV sets Q1 2008

Total TV sets = approximately 60 million

Analogue terrestrial32% Cable

6%

Free-to-view satellite1%

Pay satellite21%

Digital terrestrial40%

ADSL0.1%

227

Source: GfK researchNote: Cable main set shares in this chart differ slightly from those in Figure 3 and Figure 5 because of a small element of overlap between cable and satellite.

Figure 3.66

Platform shares by platform, TV sets 1 – 4

33 35 36 36 37 37

11 14 14 13 12 9 10 11 10 10 9 8 10 10 9 9 9

12 12 12 11 11

3 3 3 3 3 2 2 2 2 2 3 1 1 2 2 2 1

23 27 29 33 37 38

713 19 25

40

6 1219 25 30 39

612 17 22 28

39

29 26 24 19 15 13

79 70 64 6045

83 76 68 63 58 49

85 77 71 67 6251

15

0%

20%

40%

60%

80%

100%

Q3

20

05

Q1

20

06

Q3

20

06

Q1

20

07

Q3

20

07

Q1

20

08

Q3

20

05

Q1

20

06

Q3

20

06

Q1

20

07

Q1

20

08

Q3

20

05

Q1

20

06

Q3

20

06

Q1

20

07

Q3

20

07

Q1

20

08

Q3

20

05

Q1

20

06

Q3

20

06

Q1

20

07

Q3

20

07

Q1

20

08

Analogueterrestrial

DTT

Cable

Satellite

228

Source: GfK research

Figure 3.67

DTT on primary and secondary sets

5.06.4

8.49.6

1.7

4.9

8.3

13.7

0

5

10

15

Q1 2005 Q1 2006 Q1 2007 Q1 2008

DTT 1st set

DTT 2nd set

229

Source: Sales figures from GfK, as adjusted by Freeview

Figure 3.68

DTT quarterly and cumulative sales since launch of Freeview

0.0

0.5

1.0

1.5

2.0

2.5

Q4

20

04

Q1

20

05

Q2

20

05

Q3

20

05

Q4

20

05

Q1

20

06

Q2

20

06

Q3

20

06

Q4

20

06

Q1

20

07

Q2

20

07

Q3

20

07

Q4

20

07

Q1

20

08

0

5

10

15

20

25

30

35

Set-top boxes

IDTV sales

Cumulative sales

Quarterly sales (m) Cumulative DTT sales (m)

230

Figure 3.69

Average audiences on weekdays and weekends 2007 by day part

Source: BARB

0

0.004

0.008

0.012

0.016

0.02

0.024

6am 12pm 6pm 12am

weekendweekday

Average audience (millions)

6am

231

Figure 3.70

Average audiences on weekdays 2007 by day part and by age

Source: BARB

0

1

2

3

4

5

6

6am 12pm 6pm 12pm 6am

Children

16-24

25-34

35-44

45-54

55-64

65+


6am

232

Figure 3.71

Average audiences at the weekend 2007 by day part and by age

Source: BARB

0

1

2

3

4

5

6

6am 12pm 6pm 12am 6am

Children

16-24

25-34

35-44

45-54

55-64

65+


6am

233

Source: BARB

Figure 3.72

Average weekly TV reach in all homes by channel

0%

20%

40%

60%

80%

100%

Mar04

Jun04

Sep04

Dec04

Mar05

Jun05

Sep05

Dec05

Mar06

Jun06

Sep06

Dec06

Mar07

Jun07

Sep07

Dec07

Mar08

BBC One

BBC Two

ITV1

C4 + S4C

Five

Multichannels

15-minute consecutive weekly reach – full weeks

Mar 04 Mar 08

84.1%

79.1%

67.2%

58.2%

79.0%

71.8%

62.8%

59.7%

46.0%

46.0%

49.3%

75.8%

234

Source: BARB

Figure 3.73

Average weekly Total TV reach in all homes by age

75%

80%

85%

90%

95%

100%

Mar04

Jun04

Sep04

Dec04

Mar05

Jun05

Sep05

Dec05

Mar06

Jun06

Sep06

Dec06

Mar07

Jun07

Sep07

Dec07

Mar08

Children

16-24

25-34

35-44

45-54

55-64

65+


Mar 04 Mar 08

95.4%

91.7%

86.5%

84.0%

93.7%

91.3%

96.5%

95.2%

96.4%

95.8%

96.7%

96.7%

97.5%

97.0%

235

Source: BARB

Figure 3.74

Average weekly TV reach in multichannel homes by channel

0%

20%

40%

60%

80%

100%

Mar04

Jun04

Sep04

Dec04

Mar05

Jun05

Sep05

Dec05

Mar06

Jun06

Sep06

Dec06

Mar07

Jun07

Sep07

Dec07

Mar08

BBC One

BBC Two

ITV1

C4 + S4C

Five

Multichannels


Mar 04 Mar 08

80.3%

77.9%

58.0%

55.8%

75.6%

70.7%

55.5%

57.6%

44.9%

46.4%

82.3%

84.3%

236

Source: BARB

Figure 3.75

Average weekly Total TV reach in multichannel homes by age

75%

80%

85%

90%

95%

100%

Mar04

Jun04

Sep04

Dec04

Mar05

Jun05

Sep05

Dec05

Mar06

Jun06

Sep06

Dec06

Mar07

Jun07

Sep07

Dec07

Mar08

Children

16-24

25-34

35-44

45-54

55-64

65+


Mar 04 Mar 08

95.3%

91.8%

87.0%

84.0%

93.5%

91.3%

96.9%

95.4%

96.4%

95.8%

96.3%

96.4%

97.3%

96.9%

237

Source: BARB, TAM JICTAR and Ofcom estimates

Figure 3.76

Channel shares in all homes since 1982

0%

20%

40%

60%

1982 1986 1990 1994 1998 2002 2006

BBC One

BBC Two

ITV 1

Channel 4+ S4C

Five

Others

Audience share

238

Figure 3.77Five main networks’ shares by platform

Source: BARB

75%72%

68%

52% 50%49%

63%68%

74%

77%

84%

60%65%

47%50%

40%

60%

80%

100%

Mar-04

Jun-04

Sep-04

Dec-04

Mar-05

Jun-05

Sep-05

Dec-05

Mar-06

Jun-06

Sep-06

Dec-06

Mar-07

Jun-07

Sep-07

Dec-07

Mar-08

Terrestrialhomes

DigitalTerrestrialhomes

All homes

Cable andsatellitehomes

100%Audience share

239

37.5% 36.6% 34.6% 32.7% 31.6% 30.6%

24.1% 23.7%22.8%

21.5% 19.7% 19.2%

10.0% 9.6%9.8%

9.7%9.8%

8.6%

6.1% 6.5%6.6%

6.4%5.7%

5.2%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

2002 2003 2004 2005 2006 2007

Five

Channel 4+ S4C

ITV1

BBC Oneand Two

Source: BARB

Figure 3.78PSBs’ audience share: All homes 2002 - 2007

Audience share

77.7% 76.5% 73.8% 70.4% 66.7% 63.5%

240

Source: BARB

33

.6%

16

.3%

27

.6%

14

.2%

7.6

%

23

.4%

8.9

%

19

.7%

8.7

%

5.9

%

33

.1%

16

.8%

5.7

%

17

.4%

6.4

%

4.3

%

49

.1%

17

.2%

5.5

%

15

.4%

6.4

%

3.2

%

52

.1%

0%

20%

40%

60%

BBC One BBC Two ITV1 C4 + S4C Five Other

Analogue terrestrial Digital terrestrial Digital cable Digital satellite

Change in channel share by platform 2006-2007

2% -1%-6% 0% 5% 1%-7% 7% 1% 5%-2% -2% -5% -11%-14% -9% -10% -6%-11% -10% 0%16% 2%

BBC One BBC Two ITV1 Channel 4 + S4C Five Other

Figure 3.79Channel share by platform, 2007

241

Figure 3.80 Broadcaster portfolio shares in multichannel homes

Source: BARB

29.5% 29.4% 29.5% 29.8% 30.6% 31.2%

21.9% 22.1% 21.7% 22.1% 22.0% 22.3%

8.7% 8.2% 8.6% 9.6% 11.2% 11.2%

11.7% 11.7% 10.4% 9.3% 8.7% 7.6%

10.1% 10.6% 10.4% 9.6% 9.9%

5.6%5.1%5.3%5.1%4.7%4.6%

3.9%4.0%4.0%4.2%4.1%4.1%

2.7%2.9%3.1%3.4%3.5%3.5% 2.7%2.6%2.6% 2.6% 2.8% 2.8%1.4%2.3%2.4%2.2%2.0% 1.8%1.5%1.4%1.4%1.3%1.4% 1.5%

10.2%

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Other

Disney

Discovery

VirginMediaViacom

UKTV

BSkyB

Five

Channel 4

ITV

BBC

Audience share CAGR (%)

21.2% 6.1%

1 year 5 year

-0.7% 1.2%

-20.7% -6.6%

5.1% 1.1%

-8.5% -4.9%

-3.2% -1.0%

-12.1% -8.2%

10.3% 4.2%

-0.4% 5.2%

1.6% 0.4%

-2.3% 0.3%

242

Figure 3.81BBC portfolio share in multichannel homes

Source: BARB Note: Other includes BBC Parliament, Choice and Knowledge

20.0% 19.3% 19.5% 19.3% 20.0% 19.9%

7.1%7.0% 6.7% 6.9%

6.9% 7.1%

1.1%1.0%0.9%0.7%0.6%

0.4%0.1% 0.2%

0.2% 0.3%0.4%

0.8%0.6%0.6%

0.7%0.6%0.6%

0.6%0.6%0.5%

0.3%0.5%

1.3%1.3%1.3%1.2%1.1%

1.2%0.5%

0%

5%

10%

15%

20%

25%

30%

2002 2003 2004 2005 2006 2007

Other

CBeebies

CBBC

BBC News 24

BBC Four

BBC Three

BBC Two

BBC One

29.4% 29.5% 29.8% 30.6%29.5%Audience share

31.2%

243

Figure 3.82ITV portfolio share in multichannel homes

Source: BARB Note: Other includes ITV Play, Men & Motors, GMTV2, Granada Breeze, Plus, ITV NewsITV2 and ITV3 include their +1 service share

19.7% 19.3% 18.9% 18.4% 17.5% 17.6%

2.0% 2.2%2.0%1.7%1.1% 1.6% 1.4%1.4%1.2% 0.7%0.5%

0.3%0.2%1.0%1.3%1.1%

0%

5%

10%

15%

20%

25%

2002 2003 2004 2005 2006 2007

Other

CITV

ITV4

ITV3

ITV2

ITV1

21.9% 22.1% 21.7% 22.1% 22.0%

Audience share

22.3%

244

Figure 3.83Channel 4 portfolio share in multichannel homes

Source: BARB

7.1% 6.9% 7.3% 7.9% 8.2%7.4%

1.5%1.3%

1.2%1.6%

1.9%

1.8%0.1%

0.1%

0.5%0.9%0.1%0.8%0.6% 0.2%

0%

2%

4%

6%

8%

10%

12%

2002 2003 2004 2005 2006 2007

C4+1

More4

Film4

E4 Total

C4 + S4C

8.2% 8.6% 9.6% 11.2%8.7%

Audience share

11.2%

245

Figure 3.84Five portfolio share in multichannel homes

Source: BARBNote: Five Life and Five US include their +1 service share

4.6% 4.7%5.1% 5.3%

4.9% 4.6%

0.4%

0.6%

0%

1%

2%

3%

4%

5%

6%

2002 2003 2004 2005 2006 2007

Five US

Five Life

Five

4.7% 5.1% 5.3% 5.1%4.6%

Audience share

5.6%

246

Figure 3.85BSkyB portfolio share in multichannel homes

Source: BARB

3.2% 3.7% 3.6% 3.4% 3.2% 3.2%

3.9% 3.5% 3.1%2.5%

2.2% 1.6%

2.7%2.2%

3.8%3.3%

2.9%

2.4% 0.5%

0.6%

0.6%

1.1%0.8%

0.5%

0.1%

0.3%

0.3%0.1%

0.1%

0%

2%

4%

6%

8%

10%

12%

2002 2003 2004 2005 2006 2007

Sky Real Lives

Sky Travel

Sky News

Sky One/Two/Three

Sky movie channels

Sky sports channels

11.7% 11.7% 10.4% 9.2% 8.7%

Audience share

7.6%

247

Source: BARB

Figure 3.86UKTV portfolio share in multichannel homes

1.9% 1.9% 1.9%1.6% 1.4%

1.2%

1.1% 1.1% 0.8%

0.7%

0.4%0.4%

0.6%

0.6%

0.6%

0.7%

0.5%

0.4%0.3%0.2%0.3%

0.3%

0.3%

0.2%

0.2%

0.2%

0.2%0.3%

0.4%

0.1%

0.2%

0.2%0.5%

0.2%

0.2%0.2%0.2%

0.4%

0.3%0.2%

0.2%0.3%

0%

1%

2%

3%

4%

2002 2003 2004 2005 2006 2007

Other

UKTV G2/Dave

UKTV Drama

UKTV Documentary

UKTV Food

UKTV History

UKTV Style

UKTV Gold

4.1% 4.2% 4.0% 4.0%4.1%

Audience share

3.9%

248

Figure 3.87Aggregate share of channel genres in multichannel homes

Source: BARB

No. of channels

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

March 2002 March 2003 March 2004 March 2005 March 2006 March 2007 March 2008

Entertainment

Factual &Lifestyle

Children's

Music

Sport

Movies

33

30

28

16

16

21

Audience share

16

21

14

11

9

17

2002 2007

249

Share Rank Share RankChannel 2007 2007 2002 Channel 2007 2007 2002

BBC One19.9%

1 1 BBC Three 1.1% 13 -

ITV117.6%

2 2 Living 1.0% 14 11

Channel 4 7.4% 3 3 Film4 0.9% 15 88

BBC Two 7.1% 4 4 More4 0.8% 16 -

Five 4.6% 5 5 BBC News 24 0.8% 17 22

ITV2 2.2% 6 10 Disney Channel 0.8% 18 26

E4 1.8% 7 9 Sky Three 0.7% 19 -

Sky Sports 1 1.7% 8 8 UKTV Gold 2 / Dave 0.7% 20 -

ITV3 1.4% 9 - ITV4 0.7% 21 -

CBeebies 1.3% 10 12 Sky Sports News 0.6% 22 38

UKTV Gold 1.2% 11 7 CBBC 0.6% 23 71

Sky One 1.1% 12 6 Five US 0.6% 24 -

Figure 3.88The top channels by share in multichannel homes – 2002 to 2007

Source: BARBIncludes channel’s +1 services

250

Figure 3.89Platform demographics by age, social grade and viewing hours, 2007

Source: Ofcom and BARB3

.5 3.5 3.7

3.6

Terre

strial

-only

Digita

l terre

stria

l

Digita

l sat

ellite

Digita

l cab

le

0

1

2

3

4

5

Hours per day

15% 13% 14% 16% 17%

19%11% 12%

31%

18%15%

18% 20% 19%

42%44%32%26%

37%

25%

29%32%

29% 29%36%

22%

22%25% 26% 26% 24%

30%30%27%

29%

27% 24% 25%36%27%

0%

20%

40%

60%

80%

100%

UK Pop

Analog

ue o

nly

DTT o

nly

Digita

l sate

llite

Digita

l cab

le

UK Pop

Analog

ue o

nly

DTT o

nly

Digita

l sate

llite

Digita

l cab

le

15-24 25-44 45-64 65+ AB C1 C2 DE

% of average audience

251

Younger Older

Female

Male

ABC1

Paramount

Sky One

E4

Living TV

BBC3

Bravo

ITV2

Fiver

Sky Three

Challenge

Dave

Sci-Fi Five US

More4

ITV4

ITV1

FiveBBC One

Hallmark

BBC Two

ITV3

BBC Four

UKTV Drama

UK Gold

Sky Two

Paramount 2

Virgin 1

Living TV 2

C4 & S4C

Source: BARB Note: The profile of a channel is calculated relative to the television population in multichannel homes.Includes channel’s +1 services

Figure 3.90Age and demographic profile of Entertainment channels in multichannel homes

252

14%

33%

35%

35%

44%

47%

54%

63%

67%

67%

68%

26%

21%

29%

13%

3%

16%

5%

2%

6%

4%

6%

3%

5%

5%

4%

31%

3%

7%

17%

4%

13%

11%

1%

3%

1%

3%

7%

1%

4%

8%

7%

8%

6%

9%

28%

11%

8%

3%

14%

1%

1%

14%

2%

1%

48%

10%

18%

37%

11%

18%

28%

9%

2%

6%

7%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Finding out about people with similar interests

Personal interest

Discovering new things

Finding out about people with different lifestyles

Local news

Knowledge about topics

Sports News and Info

News about nation/region

Entertainment

News about UK

News about world

TV Internet Newspapers Radio Other Not interested/none/don't knowper cent (%)

PSB Review survey 2007: Q12: 2,260 interviews 16+, October-December 2007, results for TV on main channels and TV on digital channels combined under TV

Which of these media would you say is your main source for …?

Figure 3.91TV is the main source for most media interests

253

0%

10%

20%

30%

40%

50%

60%

All people 16+ People withFreeview

People withCable/satellite

People withbroadband

16-24 years 16-24s withbroadband

TV (total)

TV on mainchannelsInternet

TV on digitalchannelsRadio

Books

Newspapers

Computergames consoleMagazines

Videos/DVDs

Teletext

PSB Review survey 2007: Q13: 2,260 interviews 16+, by platform access at home, 613 interviews 16+ with Freeview, 1,054 interviews 16+ broadband access, 1,186 interviews 16+ cable/satellite

Figure 3.92TV is the medium people would find it hardest to live without

254

55%

35% 34%

7%

25%

15% 14%

2%

28%

17% 16%

4%

52%

33%28%

10%

56%

32%

41%

5%

57%

36% 38%

7%

64%

48%

31%

5%

66%

45%41%

9%

76%

48%51%

8%

0%

20%

40%

60%

80%

100%

Any concerns Poor quality content Offensive content Don't trust/ fixed/ fake/ biased

All adults 16-19 20-24 25-34 35-44 45-54 55-64 65-74 75+

T10 – Can you tell me if you have any concerns about what is on TV? What sorts of things are you concerned about?Base: All adults aged 16+ (206 aged 16-19, 207 aged 20-24, 473 aged 25-34, 661 aged 35-44, 489 aged 45-54, 341 aged 55-64, 356 aged 65-74, 167 aged 75+)Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in October to December 2007

Figure 3.93

Concerns about television, by age

255

29% 28% 29%29%26%

0%

10%

20%

30%

Aged 8-15 (n=2394) Aged 8-11 (n=1173) Aged 12-15 (n=1221)

2005

2007

QP11 Are there any controls set on your TV service so that your child could only watch particular channels or types of programmes once a PIN number or password has been entered?Base: Those with multi-channel TV in the household and whose child watches TV at home Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in April to September 2007

Figure 3.94

PIN/password protected TV, 2005 and 2007

Section 4: Radio


257

UK radio key metrics 2002-2007

UK radio industry 2002 2003 2004 2005 2006 2007

Weekly reach of radio (% of population) 90.5% 90.5% 90.3% 90.0% 89.8% 89.8%

Average weekly hours per head 21.8 22.1 21.9 21.6 21.2 20.6

BBC share of listening 52.6% 52.8% 55.5% 54.5% 54.7% 55.0%

Total industry revenue (£m) 1,083 1,128 1,158 1,156 1,149 1,179

Commercial revenue (£m) 509 543 551 530 512 522

BBC expenditure (£m) 574 585 607 626 637 657

Radio share of advertising spend 3.4% 3.6% 3.5% 3.3% 3.0% 2.9%

Number of stations (analogue and DAB) 345 357 364 372 389 397

DAB digital radio take-up (households) 1% 2% 5% 10% 16% 22%

Source: Ofcom, RAJAR 2007/08 (adults aged 15+), BBC, WARC, radio operators 2007

258

54.7%52.6% 55.0%54.5%53.5%52.8%

43.1%45.5% 42.8%43.5%44.6%45.2%

53.0%51.9% 52.4% 54.2%

55.8%55.4%

44.3%44.6%45.8%47.6%48.1%47.0%

0%

20%

40%

60%

80%

2002 2003 2004 2005 2006 2007

BBC and commercial radio share of listening and funding

Source: Listening data based on RAJAR (Adults 15+). Funding share data based on commercial radio revenues and estimated BBC expenditure on radio for 2007.Note: Remaining percentage for listening data is for ‘other’ listening, including independent stations, local community and RSL services.

Share of listening hours / share of radio funding

Figure 4.1

BBC radioshare of hours

BBC radio share of funding

Commercial radio share of hours

Commercial radio share of funding

259

Figure 4.2

0.0%

-7.0%

3.2%

-4.5%

-10%

-5%

0%

5%

BBC network radio BBC local / national National commercial Local commercial

Changes in listening hours 2006-2007, by sector

Source: RAJAR, (all listeners aged 15+). Data based on calendar year 2006 -2007.

Percentage change in listening hours

260

Figure 4.3

-2.0%

-7.8%

-3.1%

-1.2%-2.4%

-0.6%

-2.3%

-10%

-5%

0%

All adults 15+ 4-24 15-24 25-34 35-44 45-54 55+

Changes in listening hours 2006-2007, by age group

Source: RAJAR , data based on calendar years 2006 – 2007.

Percentage change in listening hours

261

Source: RAJAR, Q1 2008, (all listeners 4+), figures are rounded.Note: New RAJAR specification introduced in Q2 2007, therefore in some cases data may not be comparable with previous years.

Figure 4.4

Most listened-to radio stations, Q1 2008

% change year-on-year

+4.4%

+3.9% - 6.0%

+6.5%

-1.6%

+2.4%

+2.0% +8.0%-1.9% -4.8%

-8.6%

+43.2%+20.1%

Gcap (now Global Radio)

BBC

SMG (now TIML)

Radio group

UTV

Bauer

15.013.1

10.0

6.5 5.92.8 2.7 1.92.22,320 2.2 1.81.9

0

5

10

15

BBCRadio 2

BBCRadio 1

BBCRadio 4

BBCRadio 5

Live

ClassicFM

VirginRadioFM/AM

talkSPORTThe Hits Magic105.4

Heart106.2

BBCRadio 3

Kiss 100 95.8CapitalRadio

Wee

kly

reac

h Q

1 20

08 (

m)

262

2%

2%

3%

11%18%

0%

5%

10%

15%

20%

All digital DAB DTV Internet Digitalunspecified

Source: RAJAR (adult listeners 15+), Q1 2008.

Digital radio platforms share of all radio hours

Digital radio share of total radio audience

% increase on Q2 2007

+ 5% + 0.5%+ 3.8% + 0.6% 0%

Year-on-year increase (percentage points)

Figure 4.5

263

28%

47%51%52%

0%

20%

40%

60%

80%

15-24 25-44 45-64 65+

All who use the internet at home


Figure 4.6 Listening whilst online, by age groupAt the same time as being on the internet how frequently, if at all, do you also do any of the following activities - listen to the radio

264

9.4

12.0

8.1

14.5

0

5

10

15

Have listened online Listen online every week

Nov 07

May 08

Internet users (millions)

Source: RAJAR / Ipsos MORI, ‘Podcasting and Radio listening Via Internet Survey’, conducted during April and May 2008 and previously in October and November 2007.

16%21%

Six month increase (percent)

Figure 4.7

Listening to radio via the Internet

265

Figure 4.8

Podcast listening

3.74.3

1.9

6.0

0

1

2

3

4

5

6

Have downloaded a podcast Podcast every week

Nov 07 May 08Internet users (millions)

Source: RAJAR / Ipsos MORI, ‘Podcasting and Radio listening Via Internet Survey’, conducted during April and May 2008 and previously in October and November 2007.

95%40%

Six month increase (percent)

266

Figure 4.9

Most listened-to digital-only stations Q1 2008

869 648 666 585

1452

2320

676330558

301 2590

500

1000

1500

2000

2500

The Hits SmashHits

Radio

BBC 7 BBC 5Live

SportsExtra

PlanetRock

Heat(Digital)

BBC 6Music

1Xtra Q MojoRadio

(Digital)

VirginRadio

ClassicRock

Bauer

BBC

Other

Radio group+ 43.2%

- 12.9%+ 35.5%

+ 38.7%

- 2.6%+ 19.4% + 8.9% + 38.9%

+ 23.4%+ 96.3%

- 5.0%

Average weekly reach Q1 2008 (thousands) % change year on year

Source: RAJAR, Q1 2008, (all listeners 4+), figures are rounded.Note: New RAJAR specification introduced in Q2 2007, therefore in some cases data may not be comparable with previous years.

4.2: The radio industry

268

Figure 4.10

Type of station AM FM Total analogue1

DAB Analogue or DAB

stations 2

Local commercial 60 245 305 124 336

UK-wide commercial 2 1 3 4* 4

BBC UK-wide networks 1 4 5 11 11

BBC local and nations 36 46 46 32 46

TOTAL 99 296 359 171 397

UK radio stations broadcasting on analogue and DAB digital radio July 2008 (excluding community radio)

There are 99 services available on AM and 296 services on FM. In total there are 359 individual analogue services as 36 simulcast over both AM/FM wavebands. Of the 359 analogue stations and 171 DAB stations, there are 397 unique stations, as 38 stations are digital-only brands. *The existing Digital One national DAB radio multiplex does not offer coverage of Northern Ireland.

269

172 177 205 226 242 248 255 261 268 272 288 310 315

226 231259

280296 302 309 315 322 326 342

364 369

0

100

200

300

400

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

BBC local (inc.nations)

BBC national

Nationalcommercial

Local andregionalcommercial

Source: OfcomNote: Chart does not include community radio stations

Number of licensees

Figure 4.11

465

3

Number of analogue radio station licences awarded

270

On-air date Area Station name Ownership Date of award

May 2007 Bristol Original 106 CanWest MediaWorks UK Ltd 95%, Seven Broadcast Ltd 5%

Sept 2006

June 2007 Northallerton Minster FM The Local Radio Company Nov 2005

Aug 2007 Hull KCFM 99.9 Planet Broadcasting Co Ltd July 2006

Oct 2007 Oxford and South Oxfordshire

Jack FM Absolute Radio International Ltd Oct 2006

Oct 2007 Aberdeen Original FM CanWest MediaWorks UK Ltd 95%, Seven Broadcast Ltd 5%

Jan 2007

Nov 2007 South Wales Nation Radio (formerly XFM South Wales)

Town and Country Broadcasting, (formerly owned by GCap)

May 2007

Dec 2007 Herefordshire and Monmouthshire

Sunshine Radio Laser Broadcasting Ltd 60%, Monmouth Local Radio Ltd 20%, Hereford Local Radio Ltd 20%

Feb 2007

Jan 2008 Liverpool City Talk 105.9 FM Radio City (Sound of Merseyside) Ltd, a wholly owned subsidiary of Bauer Radio 100%

Nov 2006

Jan 2008 North East England Smooth Radio Guardian Media Group (GMG) (Previously awarded to Saga Radio (North East Ltd)

April 2006

Feb 2008 Exeter Exeter FM London Media Company (LMC) 75%, Riverside Radio Ltd 25%

Sept 2006

March 2008 Southend Southend Radio Stockvale Ltd (80%), Provincial Radio Ltd (20%) April 2006

April 2008 Warwick Touch Radio 107.3 CN Group Jan 2006

May 2008 Manchester Rock Radio Guardian Media Group (GMG) Feb 2007

Local commercial FM stations going live in 2007 /08

Figure 4.12

271

Community radio licence awards in 2008

Station Town Area Awarded

Tudno FM Llandudno North Wales January 2008

Radio Elwy/Point FM Rhyl North Wales January 2008

Preston FM Preston Lancashire January 2008

Rossendale Radio Rossendale Valley Lancashire February 2008

Canalside Radio Bollington Cheshire February 2008

Moorlands Radio Bidduplh Staffordshire February 2008

KCC Live Knowsley Merseyside February 2008

Radio Lindum Lincoln Lincolnshire March 2008

Boundary Sound Newark-on-Trent Nottinghamshire March 2008

Gravity FM Grantham Lincolnshire March 2008

Peace Radio Manchester Lancashire March 2008

North Manchester FM Manchester Lancashire March 2008

Bolton FM Bolton Lancashire March 2008

Amber Sound Ripley, Amber Valley Derbyshire April 2008

Erewash Sound Ilkeston Derbyshire April 2008

Tulip Radio Spalding, South Holland Lincolnshire April 2008

Takeover Radio Sutton-in-Ashfield Nottinghamshire April 2008

TCR FM Tamworth Staffordshire May 2008

Switch Radio Castle Vale Birmingham May 2008

Ambur Radio Walsall West Midlands May 2008

Raaj FM Sandwell West Midlands May 2008

SACDA Radio Sandwell West Midlands May 2008

EAVA FM Leicester Leicestershire June 2008

Demon FM Leicester Leicestershire June 2008

Kohinoor FM Leicester Leicestershire June 2008

Figure 4.14

272

Figure 4.15 Community radio licences to be awarded during 2008/09

Region Application date Closing date

1. East and South East England 27th August 2008 18th November 2008

2. Greater London (including areas within the M25) To be announced To be announced

Source: Ofcom

273

Figure 4.16

1156 1149

585 607 626 637

11581128 11791083

657574

522512530551543509291 306 286 274 268 271

156153169177163146

71 75 88 87 91 960

200

400

600

800

1,000

1,200

2002 2003 2004 2005 2006 2007

Total

BBC expenditure(estimated)

Total commercial

Nationalcommercial

Local commercial

Commercialsponsorship

Source: Ofcom / operator data / BBCNotes: BBC expenditure figures are estimated by Ofcom based on figures supplied by the BBC; figures in the chart are rounded.

UK commercial radio revenue and BBC radio spending

£ million

274

Source: Ofcom

Figure 4.17

Commercial net broadcasting revenue share; 2002 - 2007

Other 8%

Chart-led Mainstream 29%

Specialist Music - Youth-orientated 7%

Specialist News/Speech 5% Adult Mainstream

28%

Adult Mainstream and Chat 8%

Ethnic 1%

Specialist Music - Other 7%

35+/Gold 7%

2002200735+/Gold

7%

Adult Mainstream 42%

Specialist News/Speech

6%

Other9%

Chart-led Mainstream 18%

Ethnic 3%

Specialist Music - Other 0%

Specialist Music - Youth-orientated

10%

Adult Mainstream and Chat 5%

275

480 506 518 485437 442

3.4% 3.5% 3.4%3.2%

3.0% 2.9%

0

200

400

600

2002 2003 2004 2005 2006 2007

0%

1%

2%

3%

4%

Radioadvertisingexpenditure

Radio shareof all displayadvertising

Source: World Advertising Research Center (WARC) Note: Chart uses 2000 prices

Figure 4.18

UK radio advertising spend and share of display advertising, 2002 - 2007

Revenue £m

276

£15.97£17.15 £17.60 £17.13 £16.59 £16.81

0

5

10

15

20

2002 2003 2004 2005 2006 2007

Source: Licensee and RAJAR data

Figure 4.19

£ per listener

Commercial radio revenue per listener 2002 -2007

277

Average revenue per listener by size of station - calendar year 2007

£16.15

£5.43

£9.53

£15.15

£13.35

£15.23

0

5

10

15

20

<100k 100 to 500 500 to 1m 1m - 2m 2m to 5m 5m+

Source: Operator data, RAJAR (adults 15+), 2007

Figure 4.20

£ per listener

278

Global Radio25%

Bauer Radio14%

Independent14%

UKRD4%

Guardian Media4%

2-5 stations in group7%

6-10 stations in group15%

Local Radio Co7%

Tindle Radio4%

UTV6%

6-10 stations in group

2-5 stations in group

Independent

Global Radio

Bauer Radio

Local Radio Co

UTV

Tindle Radio

UKRD

Guardian Media

Source: OfcomNote: The percentages are derived from a universe of stations rather than licences

Figure 4.21

Number of commercial analogue stations owned by group

279

23.3%

37.9%39.4%

35.7% 34.0% 31.2%30.4%

24.5% 23.7%25.1%23.1% 24.6%

11.3%12.1%

11.0% 11.2%11.7%

11.7%11.5% 14.0% 13.7%

11.8% 13.0%11.2%

4.6%8.6%5.8%4.8%

11.1%3.8%

6.6% 6.6%6.9%

7.4%

7.2%7.2%

3.8%3.6% 3.6% 3.7%3.7% 3.8%0%

10%

20%

30%

40%

2002 2003 2004 2005 2006 2007

GCap (now GlobalRadio)Emap (now Bauer)

Global Radio (formerChrysalis)Other

GMG

UTV

SMG (now TIML)

Share of commercial listening hours

Source: RAJAR (adult 15+)Note: Emap now Bauer as at January 2008, SMG now TIML as at May 2008, GCap Radio now owned by Global Radio as at June 2008

Percentage of listening hours

Figure 4.22

280

Bauer Radio (former Emap)10%

Global Radio (former Chrysalis)

5%

GCap (now Global Radio)

12%

TLRC1%

Other 6%

BBC local / nations10%

BBC network47%

GMG5%

SMG (now TIML)1%

UTV3%

BBC network

BBC local / nations

GCap (now Global Radio)

Bauer Radio (former Emap)

Global Radio (former Chrysalis)

GMG

UTV

SMG (now TIML)

TLRC

Other

Source: RAJAR Q1 2008Note: GCap now Global Radio as at June 2008, SMG now TIML as at May 2008

Figure 4.23

Share of radio listening hours – commercial groups and BBC

Percentage share of listening hours

281

Figure 4.24

14,42911,904

6,532 4,792 3,733 2,695 9250

5,000

10,000

15,000

GCap (nowGlobalRadio)

BauerRadio

(formerEmap)

GlobalRadio

(formerChrysalis)

GMG UTV SMG (nowTIML)

TLRC

0%

2%

4%

6%

8%

10%

12%

14%

Commercial radio reach: weekly audience reach

Source: RAJAR Q1 2008, adultsNote: GCap now Global Radio, as at June 2008, SMG now TIML as at May 2008

Weekly reach Q1 2008 (thousands)

Annual change in reach

- 4.9% + 2.5% + 6.4%

+ 0.1% + 2.5% + 1.2%

+ 2.0%

282

Source: RAJAR Q1 2008, all listeners 15+

Figure 4.25

National commercial stations: reach and share of listening hours

5622

2470 2466

0

2000

4000

6000

Classic FM talkSPORT Virgin AM / FM

3.7% share of hours

1.9% share of hours 1.4% share of hours

Weekly reach Q1 2008 (thousands) % share of all radio listening hours

Annual change in weekly reach

- 6.8% + 5.5% + 0.7%

283

16.0%

10.0%

10.4%11.1%11.0%11.0% 10.9% 10.3%

9.2%8.4% 8.2%

9.7%7.7%

15.7%16.4%15.8%

15.8%16.0%

1.2%1.3%1.2% 1.4%1.2%1.4%

11.8%11.5% 11.5% 11.8% 11.1%11.5%

4.6%4.7% 4.2% 4.5%4.3%4.4%

0%

5%

10%

15%

20%

2002 2003 2004 2005 2006 2007

BBC radio audience share

Source: RAJAR (adult 15+)

Listening hours (%)

Figure 4.27

BBC Radio 2

BBC Radio 4

BBC Local / Nations

BBC Radio 1

BBC Radio 5 Live

BBC Radio 3

284

8.4

6.1

4.9

1.91.4

4.9

0

2

4

6

8

10

Breakfastpeak

Midmorning

Afternoon PM drive Evening Overnight

Source: RAJAR, Q1 2008 (all listeners 4+)

Figure 4.28

Listening audience (millions)

All BBC radio listening across the day (weekday)

285

Figure 4.29

1.0%1.1%1.2%1.3%1.6%

2.7%3.6%

12.0%19.0%

20.4%22.0%

27.1%

0% 10% 20% 30%

BBC 6 MusicBBC Asian

1Xtra from the BBC5 Live Sports Extra

BBC 7BBC World Service

BBC Radio 3BBC Radio 5 Live

BBC Radio 4BBC Local/Nat

BBC Radio 1BBC Radio 2

Source: RAJAR Q1 2008, adults 15+

Weekly reach of BBC stations

Average weekly listening (% UK adults)

286

Figure 4.30

2.9%1.4%1.7%2.0%5.7%5.9%

17.3%

51.6%

2.6%3.5%5.3%

0%

20%

40%

60%

Music News andweather

Drama Sport Entertainment Currentaffairs

Factual Arts Children's Religion Other

Source: BBC annual report 2007/08

BBC network radio broadcast hours, by genre

Share of output (%)

287

£400£600£600

£800

£1,300£1,600

£1,700£1,800

£3,300£3,500

£4,300£4,500

£6,300£9,900

£1,700

£1,200

0 2000 4000 6000 8000 10000 12000

BBC Local Radio EnglandBBC Radio 6 Music

BBC Radio 71 Xtra

BBC Radio nan GaidhealBBC Radio Asian Network

BBC CymruBBC Ulster / Foyle

BBC Radio 5 Live Sports ExtraBBC Wales

BBC ScotlandBBC Radio 1BBC Radio 3BBC Radio 2

BBC Radio 5 LiveBBC Radio 4

Source: BBC Annual report 2007/08

Figure 4.31

Cost £ per hour

BBC radio stations: cost per hour of programmes

288

Source: RAJAR Q1 2008, (all listeners 4+)Note: Total Global Radio – Weekly reach based on the combined Q1 2008 listening results for GCap and Global Radio’s former Chrysalis stations. Figures may be lower as some stations may share audiences, thereby reducing weekly reach.

Figure 4.34

Global Radio main networks: reach and share of hours


24,274

7,707 5,9448,358

16,567

0

5000

10000

15000

20000

25000

CombinedGlobal / GCap

GCap Global - formerChrysalis

GCap - OneNetwork

Classic FM


- 4.5% - 6.2% - 8.6%- 0.7% - 7.2%

12.2% share of hours

5.2 % share of hours5.8% share of hours

3.7% share of hours


289

Source: RAJAR Q1 2008, (all listeners 4+)

Figure 4.36

Bauer main networks: reach and share hours

14,578

3,0195,391

0

3000

6000

9000

12000

15000

Total Bauer Big City Network Magic Network


4.1% share of hours

1.9% share of hours



- 11.6% - 4.4% + 3.1%

290


Figure 4.38

GMG main networks: reach and share of hours

5,398

1,785 1,2942,586

0

2000

4000

6000

Total GMG Total Smooth Total Real Radio Total Century



- 3.3% + 42.1% - 2.7%- 0.9%

4.5% share of hours

2.1% share of hours

0.8% share of hours

1.6% share of hours

291


Figure 4.40

UTV main networks: reach and share of hours

4,245

1,6242,680

0

2000

4000

6000

Total UTV TalkSPORT UTV local radio

3.2% share of hours

1.8% share of hours

1.3% share of hours



+ 4.3% + 8.0% - 1.0%

292


Weekly reach Q1 2008 (thousands) % yearly growth rate - on Q1 2007

Figure 4.41

Virgin main stations: reach and share of hours

3,070

1,249372

1,725

0

1000

2000

3000

4000

Total Virgin Radionetwork

Virgin Radio (AM) Virgin FM London Virgin digital stations

+ 1.6%

- 15.1%

- 2.3%

+ 22.8%

293

Award date

Location Multiplex operator Adult population in licensed area

Estimatedindoor coverage

June 2007 Hertfordshire, Bedfordshire and Buckinghamshire

NOWdigital 1.8m 75%

July 2007 Derbyshire NOWdigital East Midlands 843k 73%

July 2007 National multiplex 4 Digital Group 50.3m 79%

Sept 2007 North East Wales & West Cheshire MuxCo Northeast Wales and West Cheshire 647k 95%

Sept 2007 Herefordshire and Worcestershire MuxCo Hereford & Worcester 586k 67%

Oct 2007 Northamptonshire NOWdigital Limited 505k 84%

Nov 2007 Oxfordshire Now Digital Oxford 494k 83%

Dec 2007 North Yorkshire MuxCo North Yorkshire 695k 57%

Feb 2008 Gloucestershire MuxCo Gloucestershire 460k 75%

Feb 2008 Lincolnshire MuxCo Lincolnshire 670k 74%

Mar 2008 Mid and West Wales MuxCo Wales 400k 40%

Apr 2008 Surrey & northern Sussex MuxCo Surrey & North Sussex 1.4m 57%

May 2008 Somerset MuxCo Somerset 481k 61%

June 2008 North Wales MuxCo Wales 311k 42%

Source: Ofcom

Local DAB multiplex awards in 2007/08 (Eng & Wales)

Figure 4.45

294

Availability of DAB stations, by area

20 2115

37

2031

1025

35

2

4

44

44

44

4

44

4

13

13

1312

1212

1212

12

1212

12

26

44

8

314

12

0

20

40

60

No

rth

ern

Ire

lan

d

Sco

tlan

d

Wa

les

Ce

ntr

al S

ou

the

rn E

ng

lan

d

Ea

st E

ng

lan

d

Ea

st M

idla

nd

s

Lo

nd

on

We

st M

idla

nd

s

No

rth

Ea

st

No

rth

We

st

So

uth

We

st

We

st E

ng

lan

d

Yo

rksh

ire

BBC network and local

National commercial

Local commercial`

Source: OfcomNote: This shows the maximum number of stations available in each area; local reception issues mean that some listeners may not be able to access all of these.

Figure 4.46

295

350 343393

464423 450

493 489 498 475432

0

100

200

300

400

500

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Source: Ofcom

Number of licences

Figure 4.47

Number of short-term RSLs

296

6%

12%11%

25%24%

20%

13%

0%

5%

10%

15%

20%

25%

30%

Communitytrial

Student Religious Festival Sports Education Other

Share of licences

Source: Ofcom

Figure 4.48

Reasons for running a short-term RSL 2007

297

38%

1%

13%

49%

0%

10%

20%

30%

40%

50%

60%

Educationalestablishments

Hospitals HM Forces Tourist site

Share of licences

Source: Ofcom

Figure 4.49

Reasons for running a long-term RSL 2007

4.3: The radio listener

299

61%

90%91%91% 90% 90% 90%

66%66% 66%66%67% 67%

65% 63%65% 64% 63%

58%58%

58% 58%58%

58%49%54% 52%51%52%56%

27%26% 27% 27%26%21%

20%21%21% 21% 21%22%

6%6%6% 5% 5% 6%0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

All radio

All BBC

All commercial

BBC network

Local commercial

National commercial

BBC nations / local

Other

Reach of radio, by sector

Source: RAJAR (adult 15+)

Percent of population

Figure 4.50

300

88%91%92% 93%91% 89%

93%88%

92% 92%87%90% 88% 89% 90% 88%

92% 92%

0%

20%

40%

60%

80%

100%

AllIndiv's

15+

AllIndiv's

4-24

Adults15 - 24

Adults25 - 34

Adults35 - 44

Adults45 - 54

Adults55+

ABC115+

C2DE15+

2002 2007

Reach falls most in 15-34 age group 2002 – 2007

Source: RAJAR: data based on calendar years 2002 and 2007

Percent of reach

Figure 4.51

All 15+- 0.8%

4-24- 0.8%

15-24- 2.7%

25-34- 1.2%

35-44- 0.5%

45-54- 0.4%

55+ 0.4%

ABC1- 0.6%

C2DE- 0.8%

Percentage point change

301

55.4%53.0%53.0% 54.0% 55.1% 54.4%

45.4%42.0% 43.2%43.0%42.0% 44.0%

10.0%

11.0% 10.4%11.0% 11.0% 11.1%

42.4%45.0% 42.8% 43.2%

46.0%44.2%

11.3%

10.0% 10.5%10.1%10.0%8.0%

31.1%35.7% 34.2% 32.8%32.7%

38.0%

2.2%2.3%2.0% 1.8% 2.1%2.0%0%

20%

40%

60%

2002 2003 2004 2005 2006 2007

All BBC

BBC Network

BBC local / nations

All commercial

National commercial

Local commercial

Other

Share of listening hours, by sector

Source: RAJAR (adult listeners15+)

Percent of listening hours

Figure 4.52

302

12.616.3 17.8

21.1 21.919.2 19.9 21.3

22.622.6

0

10

20

30

4-24 15-24 25-34 35-44 45-54 55+ AdultMen

AdultWomen

ABC1Adults

C2DEAdults

Average listening per week (all aged 4+)

19.0 hours

Weekly listening hours

Source: RAJAR Q1 2008, (average weekly listening hours per head)

Figure 4.53

Demographic profile of overall listening

303

-4.4%-3.1%

-10.6%

-6.4%

-12.2%

-2.4%

2.3%

-15%

-10%

-5%

0%

5%

All 15+ 4-24 15-24 25-34 35-44 45-54 55+

Source: RAJAR (Individuals 4+): data based on calendar years 2002 and 2007

Listening hours % change over 5 years

Figure 4.54

Changes in listening hours over five years, by age group

304

Figure 4.55

19% 26% 26%14% 6%

13%12% 16%

13%

4%

18%16%

22%

17%

8%

16% 14%

17%

17%

12%

35% 33%19%

40%

70%

0%

20%

40%

60%

80%

100%

All radio Nationalcommercial

Localcommercial

BBC UKnetwork

BBClocal/national

Adults 55+

Adults 45-54

Adults 35-44

Adults 25-34

All Individuals 4-24

Source: RAJAR (Individuals 4+): 2007/08 (Q2 2007 – Q1 2008)

Profile of audience by age for different station types 2007/08

Proportion of hours

305

Source: RAJAR (Individuals 4+): data based on calendar years 2002 and 2007

Listening hours % change over 5 years

Figure 4.56

Changes in listening hours 2002 - 2007 by age group

-3%

42%

6%

-11%

3%

-6%

-29%

-12%

7%

-30%

-4%-14%

-2%-8%

0%

-25%

2% 2%7%

-14%-19%-11%

-33%

-12%

-2%

-33%

49%

-21%

51%

9%

35%

10%

-11%

-40%

-20%

0%

20%

40%

60%

All adults 15+ 4-24 15-24 25-34 35-44 45-54 55+

National commercial

All radio Local commercial

BBC UK network

BBC local /

national 225%209%

306

Share of listening hours by nation

90.1%89.6%90.5%88.6%90.3%Reach

23.5 hours23.1 hours24.4 hours22.9 hours23.5 hoursAverage weekly listening

UK TOTALNorthern Ireland

WalesScotlandEngland

Percent of listening hours

Source: RAJAR: data based on calendar year 2007

44% 45%35%

47%27%

10% 10%9%

15%

25%

11% 11%11%

10%7%

32% 32%43%

27%31%

2% 2% 3% 1% 10%

0%

20%

40%

60%

80%

100%

Total UK England Scotland Wales NorthernIreland

Other

Localcommercial

Nationalcommercial

BBClocal/national

BBC network

Figure 4.57

307

63%

14%

2%4%5% 2%7%

2% 3% 5%6%

53% 54%

65%

76%

3%4% 7%13%

6%

24%

1%

11%5%8%

1%

11% 14% 12%

22%

0%

20%

40%

60%

80%

Analogue DAB radio set Digital radio throughTV

Digital radio throughinternet

Radio via mobilephone

Every day Once a week Once a month Have tried it once Never Do not have access to device


Percent of respondents who listen to the radio

Figure 4.58

How often do you access the radio? by platform

308

Take-up of equipment capable of receiving digital radio

Source: Ofcom, Q1 2008

Figure 4.59

Share of households

27%

0%

20%

40%

60%

80%

Internet Digital TV DAB radio

67%

Satellite37%

Terrestrial38%

Cable 12%

Broadband 57%

Dial-up 9%

87% 27%

+ 3% + 7% + 10%


309

Take-up of DAB digital radio

17%

27%

1%2%

6%

11%

0%

10%

20%

30%

Q1 2003 Q1 2004 Q1 2005 Q1 2006 Q1 2007 Q1 2008

Percentage of UK homes owning DAB


Figure 4.60

310

Number of analogue and digital radio sets sold

Source: DRDB / GfK

2.1

8.37.9

10.1

1.5 1.8

0

2

4

6

8

10

Year to April 2006 Year to April 2007 Year to April 2008

analogue sets

DAB sets

Radio set sales (millions)

20.2%79.8%12.9%87.1%

Percentage of sales

18.6%81.4%

Figure 4.61

311

Value of analogue and digital radio set sales

£482£489

£598

£170£145 £155

£0

£100

£200

£300

£400

£500

£600

Q1 2006 Q1 2007 Q1 2008

Analogue sets

DAB sets

Value of radio sales (£ millions)

24.1%75.9%19.5%80.5%

Proportion of sales

26.1%73.9%

Figure 4.62

Source: DRDB / GfK

312

£0

£100

£200

£300

£400

£500

Q12003

Q3 Q12004

Q3 Q12005

Q3 Q12006

Q3 Q12007

Q3 Q12008

All

In-home

Car audio

Portable

Source: GfK Q1 2008

Change in average price of DAB digital radio receivers

Figure 4.63

313

320304

230

165

642715

0

100

200

300

Q1 2002 Q1 2003 Q1 2004 Q1 2005 Q1 2006 Q1 2007 Q1 2008

Source: DRDB / GfK

Number of models

Number of DAB models available in the UK

Figure 4.64

314

31%

18%

11%

6% 7%

0%

10%

20%

30%

40%

All Digital DAB DTV Internet Digitalunspecified

Source: RAJAR (adults 15+), Q1 2008

Percentage of adults listening via digital formats on a weekly basis

Figure 4.65

+ 5% + 1%+ 5% + 1% 0%


Digital radio weekly reach

315

1%

13%

21%

14%

51%

0%

10%

20%

30%

40%

50%

Frequently Sometimes Rarely Never Don't have



Figure 4.66

Radio listening whilst onlineAt the same time as being on the internet how frequently, if at all, do you also do any of the following activities - listen to the radio

316

2%

8%7%

11%

0%

3%

6%

9%

12%

15%

15-24 25-44 45-64 65+


Source: Ofcom research, Q1 2008Base: All who use the internet at home

Figure 4.67 Levels of radio listening since acquiring the internetSince using the internet which activities do you undertake less – listening to the radio

317

4%

86%93%96%

84%

7%13%15%

0%

20%

40%

60%

80%

100%

15-24 25-44 45-64 65+

Yes No

Source: Ofcom research, Q1 2008Base: All who listen to radio

Figure 4.68

Awareness of digital radioHave you ever heard of the term ‘digital radio?’

318

4.6

3.8

0.5

1.91.6

1.1

0.4

1.6

0.1

1.3

0.3

2.5

0

1

2

3

4

5

BBC Radio1

BBC Radio2

BBC Radio3

BBC Radio4

BBC Radio5 Live

BBC 7

Streamed hours On demand

Source: Sage / BBC, Q4 2007

Figure 4.69

BBC network radio: hours of streaming and on-demand content, Q4 2007

Hours (millions)

+31% -3% +22% +5% +6% - 5% +45% + 14% +37% -9% +11% +11%% change year on year

319

1.7

0.91.1 1.01.5

4.24.9

6.9

1.2

4.3

1.3

2.73.1

3.74.4

1.2 1.00.40.7

1.20.6 0.3 0.2

0.8

0

1

2

3

4

5

6

7

Breakfastpeak

Midmorning

Afternoon PM drive Evening Overnight

BBC network

Local commercial

Nationalcommercial

BBC local / regional


Figure 4.70

Patterns of listening across the day

Listeners (millions)

320

7.2

1.2

7.7

0.8 1.2

8.1

6.2 6.2

2.43.0

1.21.0

2.3

6.1

7.8

6.3

0.8

2.9

1.2

6.4

0.8

7.9

2.3

1.0

3.0

1.21.2

2.82.3

0.8

6.4

8.1

0

2

4

6

8

10

BBC Radio1

BBC Radio2

BBC Radio3

BBC Radio4

BBC Radio5 Live

Classic FM talkSPORT Total Virgin(AM/FM)

Q1 2005

Q1 2006

Q1 2007

Q1 2008

`

Source: RAJAR Q1 2008, (adult listeners 15+)

Figure 4.71

Breakfast-time reach of national stations

Breakfast reach (millions)

321

Work / outdoors16%

Home63%

Car20%

Other 1%

Source: RAJAR Q1 2008, all listeners

Figure 4.72

Location of listening

322

1%

48%40%

7% 3%

0%

10%

20%

30%

40%

50%

Very satisfied Fairly satisfied Neither Fairly dissatisfied Very dissatisfied

Percentage of respondents who listen to the radio


Figure 4.73

Satisfaction with choice of radio stations

Section 5: Telecoms


324

UK telecoms industry key metrics

UK telecoms industry 2002 2003 2004 2005 2006 2007

Operator-reported retail revenue (£bn) 24.7 26.2 27.5 28.0 28.8 29.9

Operator-reported wholesale revenue (£bn) 8.4 8.5 8.6 8.3 8.5 8.9

Fixed voice call minutes (billions) 165 167 164 160 151 148

Mobile voice call minutes (billions) 52 59 64 71 82 99

Average monthly household spend on telecoms services (£)

62.80 66.77 69.60 68.08 66.48 64.74

Fixed access and call revenues (£bn) 11.7 11.2 10.6 9.8 9.4 9.3

BT share of fixed revenues (%) 71.6 71.1 68.9 66.5 63.6 62.8

Proportion of unbundled exchanges (%) 12.4 23.3 31.0

Fixed lines (millions) 35.2 35.0 34.6 34.1 33.6 33.7

Mobile retail revenues (£bn) 9.0 10.5 12.0 13.0 13.8 15.1

Active mobile connections per 100 population 82.6 88.0 99.5 109.1 116.3 122.6

Active 3G mobile connections per 100 population

0.0 0.4 4.3 7.7 13.0 20.9

Internet connections per 100 population 19.3 22.9 25.8 27.2 28.9 30.4

Broadband connections per 100 population 2.3 5.2 10.2 16.5 21.7 26.0

325

Figure 5.1

165 167 164 160 151 148

52 59 64 71 82 99

217 226 228 231 233247

0

100

200

300

2002 2003 2004 2005 2006 2007

Cal

l min

utes

(bi

llion

s)

Mobile

Fixed line

Source: Ofcom / operatorsNote: Excludes dial-up internet access

Total UK outbound voice call volumes

326

Figure 5.2Frequency of using a mobile phone in the home

Source: Ofcom research, February / March 2008Base: All who use a mobile phone

26

39

14

21

70

30

45

16

10

74

0 20 40 60 80

Summary - ever use mobileat home

"I never make calls on mymobile"

"I make some of my calls onmy mobile"

"I make most of my calls onmy mobile"

"I make all of my calls on mymobile"

Proportion of respondents (%)

All withmobile

Landlineand mobile

327

Figure 5.3

Source: Ofcom research, February / March 2008Base: All who use a mobile phone at homeNote: Multiple responses permitted

Reasons for using mobile phone while at home

28

2521

119

21

73

11

3

29

0 10 20 30

To use my inclusive minutes

Some calls are cheaper

More convenient

Easier to find number

Landline in use by someone else

For privacy

Work phone

Landline tied to internet

Other

Don't know

Don't like being contactable/ lack of privacy

No reception where I live

Other

Proportion of respondents using a mobile phone at home (%)

328

Figure 5.4

19 2010 9 10 7 7

73 7080 80 80 84 81

7 8 9 10 10 9 111 2 1 1 1

0%

20%

40%

60%

80%

100%

Q4 2002 Q4 2003 Q4 2004 Q1 2006 2006 Q1 2007 Q1 2008

Pro

port

ion

of a

dults

(%

)

None

Mobile only

Fixed andmobile

Fixed only

Household penetration of fixed and mobile telephony

Source: Ofcom research, Q1 2008Base: All adults

329

Provider Basic line rental

UK weekend calls

UK weekend and evening

calls

UK anytime calls

UK anytime calls and

international calls1

BT £10.50 £10.50 £10.502 £16.45 £21.45

Sky Talk £10.503 £10.50 £10.50 £15.50 £15.50

TalkTalk £10.50 £10.50 £10.504 £14.995 £14.996

Virgin Media7 £11.00 £11.00 £14.45 £18.95 n/a

Source: Ofcom, June 2008Notes: (1) Number of countries international calls are available to varies (all include at least 20); (2) requires a 12-month contract which on prior notice enables the customer to opt out and if not, automatically renews; (3) line rental payable to BT; (4) increases to £13.15 after 12 months; (5) increases to £19.99 after 18 months; (6) offer available for a limited period of time; (7) includes basic TV package.Additional note: This table is indicative of inclusive-call offers only and should not be used to compare overall pricing as many additional factors including calls to mobile, friends & family tariffs, contract lengths and multi-service bundling are not included.

Unlimited call tariffs from leading fixed-line voice operators

Figure 5.5

330

Figure 5.6

Source: Ofcom / tariff data from Pure PricingNotes: Data based on tariffs available in June of each year; standard tariff selected which offers highest number of any-time, any-network minutes for £30 or less on an 18-month or 12-month contract; excludes tariffs only available online or direct; excludes specific promotions; excludes SIM-only deals; some variation between 2006 and 2007 is caused by greater availability of 18-month contracts; this table is indicative of inclusive any-time, any-network minutes only (and texts when they are additional to the maximum number of minutes) and should not be used to compare overall pricing as many additional factors are excluded, such as handset, on-net calls, off-peak calls, data bundles and metered pricing

Inclusive any-network, any-time allowance in £30 per month mobile contracts

500

500 75

0

1100

200

200 40

0

400

200

200 40

0

400

200 45

0

450 70

0

200

200 300 50

0

100

100

150

50 100

500

500

75

100

100

250 10

0

0

500

1000

1500

2005

2006

2007

2008

2005

2006

2007

2008

2005

2006

2007

2008

2005

2006

2007

2008

2005

2006

2007

2008An

y-n

etw

ork

, an

y-tim

e in

clu

sive

ca

lls/te

xts

Texts

Minutes

3UK O2 Orange T-Mobile Vodafone

331

Figure 5.7

40% 41%

23% 26%

14% 11%

14% 11%

9% 11%

0%

20%

40%

60%

80%

100%

Minutes Texts

Pro

port

ion

of c

ontr

acts

(%

)

Unsure

My usage varies a lot - some months Iuse all, some months I don't

I usually exceed my monthlyallowance

The amount I have is about right

I have more than I use each month

Use of inclusive minutes and textsDo you generally use all your inclusive minutes / texts or do you tend to have some left over at the end of each month?

Source: Ofcom research, July 2008Base: Adults 16+ who have a post-pay mobile contract; excludes 9% of users who did not know whether they exceeded their minutes allowance and 21% who did not know whether they exceeded their textx allowance

332

Figure 5.8Relationship between monthly bill and monthly line rental for pay-monthly mobile consumersWould you say that your total monthly bill is usually the same, a bit higher or a lot higher than your fixed monthly payment?

A lot higher, 7%

The same, 61%

A bit higher, 25%

Unsure, 7%

Source: Ofcom research, July 2008Base: Adults 16+ who have a postpay mobile contract.Note: The “fixed monthly payment” was defined to respondents as “the amount you would have to pay for line rental even if you did not make any calls or receive any texts”

333

Figure 5.9

13.39 14.05 14.37 13.71 13.15 13.29

14.57 14.65 15.16 14.4712.98

11.50

0

5

10

15

20

2002 2003 2004 2005 2006 2007

£ pe

r m

onth

/ p

ence

per

min

ute

Voicerevenue perconnectionper month(£)

Revenueper voiceminute(pence)

Source: Ofcom / operatorsNotes: Includes line rental and additional voice revenue; based on network operator reported figures; includes estimates where Ofcom does not receive data from the operators

Voice revenue per contract connection and revenue per minute

334

Figure 5.10

63 77 88 96 101

910

28 3298

125133

6

86

69

0

50

100

150


New

mon

thly

con

nect

ions

(00

0s)

Pre-pay

Contract

Source: GfK retail data (includes only consumer channels)

New consumer mobile broadband connections

335

Figure 5.11

71

15

19

20

49

133

37

0%

20%

40%

60%

80%

100%

Mobile broadband Mobile phone

Pro

port

ion

of c

ontr

acts

(%

) £50.00+

£40-49.99

£30-39.99

£20-29.99

£0-19.99

Monthly line rentals for mobile broadband contracts and mobile phone contracts, January – May 2008

Source: GfK retail data (includes only consumer channels)Notes: Mobile broadband data based on new contract in February-June 2008; mobile phone data based on new contracts (excluding SIM-only) in January to March 2008

336

Figure 5.12

Source: GfK retail data (includes only consumer channels)Notes: Multi-code question; Caution: low sample for 16-24 and over 65 – use as a guide only

Use of mobile and fixed-line broadbandIs your mobile broadband in addition or instead of a fixed connection?

6853

70 74 67 75 81

3247

30 26 3325 19

0%

20%

40%

60%

80%

100%

Total 16-24 25-34 35-44 45-54 55-64 65+

% o

f m

obile

bro

adba

nd u

sers

Instead of afixed internetconnection

In addition to afixed internetconnection

337

Figure 5.13

44% 36%

15%18%

8%4%

25%

2%

8%5%

28%

0%

20%

40%

60%

80%

100%

SMS Internet

Pro

port

ion

of U

K a

dults

Unsure

Never

Less than once a year

A few times a year

At least once a month

At least once a week


Every day

Source: Ofcom research, Q1 2008Base: All UK adults

Use of SMS and use of the internet

338

Figure 5.14

17.6 22.1 26.2 33.443.3

58.8

67

82

0

20

40

60

80

100

2002 2003 2004 2005 2006 2007

Mon

thly

out

boun

d S

MS

(bi

llion

s)

SMS volumes(billions)

Monthlyoutbound SMSper connection

Monthlyoutbound SMSper capita


Outbound SMS volumes

5.2: The telecoms industry

340

Figure 5.15

33.0 34.7 36.1 36.3 37.3 38.8

14.8 16.1 17.2 20.1 19.522.647.8

50.8 53.356.4 56.7

61.5

0

20

40

60

2002 2003 2004 2005 2006 2007

Tur

nove

r (£

bn)

Otherrevenue

Operator-reportedservicerevenues

Source: Ofcom / ONS / operatorsNote: Includes estimates where Ofcom does not receive data from operators; total turnover figures are not comparable to those published in the 2007 Communications Market Report as they no longer include an estimate for other retail data

UK telecoms industry turnover

341

Figure 5.16

24.7 26.2 27.5 28.0 28.8 29.9

8.4 8.5 8.6 8.3 8.5 8.933.0 34.7 36.1 36.3 37.3 38.8

0

10

20

30

40

2002 2003 2004 2005 2006 2007

Tur

nove

r (£

bn) Wholesale

revenue

Operator-reportedretail servicerevenues

Source: Ofcom / operatorsNote: Includes estimates where Ofcom does not receive data from operators

Operator-reported UK telecoms revenue

342

Figure 5.17


UK telecoms industry retail revenue

11.7 11.2 10.6 9.8 9.4 9.3

9.0 10.5 12.0 13.1 13.8 15.1

1.8 2.2 2.5 2.5 2.8 2.82.2 2.3 2.5 2.6 2.7 2.824.7

26.2 27.5 28.0 28.8 29.9

0

10

20

30

2002 2003 2004 2005 2006 2007

Ret

ail r

even

ue (

£bn)

Corporate dataservices

Internet &broadband

Mobile voice &data

Fixed calls &access

343343

£1.1bn

-£0.1bn-£0.2bn£0.1bn

£1.3bn

Mobile Corporate dataservices

Fixed voice Internet &broadband

Total growth

Subscription growth &

increasing usage

Ethernet and IP VPN Networking

services

Falling line numbers &

declining usage

Migration to broadband & falling prices

Key drivers

Figure 5.18

Known telecoms revenue growth between 2006 and 2007


344

Figure 5.19

Total telecoms connections

Source: Ofcom / operatorsNote: Includes estimates where Ofcom does not receive data from operators; broadband excludes corporate connections

52.8

13.7 15.5 16.3

35.2 35.0 34.6 33.733.634.1

49.6

59.765.5 69.8

73.5

11.618.317.3

15.613.09.96.1

3.11.40

20

40

60

80

2002 2003 2004 2005 2006 2007Con

nect

ions

/ s

ubsc

ript

ions

(m

illio

ns)

Fixed lines

Mobilesubscriptions

Total internetsubscriptions

Of whichbroadband

345

Figure 5.20

34.4 32.7 29.4 26.0 22.8 20.7

5.5 5.3 5.0 4.5 4.2 4.2

14.4 14.4 14.5 14.914.2 15.4

14.1 15.0 15.6 17.1 18.4 18.7

14.2 14.9 15.5 15.4 16.4 16.1

15.7 15.6 15.1 14.9 14.8 14.7

2.7 3.5 3.7 3.76.55.53.71.6 1.9 2.3

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Pro

port

ion

of c

onne

ctio

ns (

%) Other

3UK

Orange

T-Mobile

O2

Vodafone

Cable

BT

Source: Ofcom / operatorsNote: Includes estimates where Ofcom does not receive data from operators; ‘other’ includes CPS, WLR, Mobile ISP and MVNO subscribers in additional to fixed other licensed operators

Share of total UK fixed and mobile telecoms connections

346

Figure 5.21

24.0 26.1 28.1 30.8 35.2 40.2

28.9 31.1 32.2 34.2 33.0 30.5

47.1 42.9 39.6 35.1 31.7 29.3

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Pro

port

ion

of c

onne

ctio

ns (

%)

BT

Other fixed

Mobile


Share of total outbound voice call volumes

347

Figure 5.22


Fixed voice telecoms revenue

4.6 4.6 4.6 4.5 4.5 4.7

2.7 2.4 2.0 1.7 1.6 1.5

0.9 0.8 0.7 0.6 0.6 0.6

2.1 2.1 2.0 1.8 1.7 1.7

1.4 1.41.4

1.2 1.0 0.9

11.7 11.210.6

9.8 9.4 9.3

0

5

10

15

2002 2003 2004 2005 2006 2007

Rev

enue

(£b

n)

Other voicecalls

Calls tomobiles

Internationalcalls

UK geographiccalls

Access

348

Figure 5.23

10.82 10.96 10.99 11.03 11.17 11.51

18.76 17.50 15.81 13.91 12.88 11.81

£29.58 £28.46£26.80

£24.95 £24.05 £23.32

0

10

20

30

2002 2003 2004 2005 2006 2007

Rev

enue

per

mon

th (

£)

Calls

Access

Source: Ofcom / operatorsNote: Includes spend on non-geographic voice calls

Average monthly voice revenue per fixed line

349

Figure 5.24

165 167 164 160 151 148

168 168141

8242

15

333 335304

242

194162

0

100

200

300

400

2002 2003 2004 2005 2006 2007

Bill

ions

of

min

utes

Narrowbandinternet calls

Voice calls


Fixed telecoms call volumes

350

Figure 5.25

131 138119

6732 20

44 38

31

23

1914

4 4

4

4

55

179 182

155

95

5740

1 1

1

1

11

0

50

100

150

200

2002 2003 2004 2005 2006 2007

Bill

ions

of

min

utes

Directory enquiries calls(inc. international)

Calls to premium rateservices

Special services: higherhate

Special services: basicrate

Freephone calls


Non-geographic fixed call volumes

351

Figure 5.26

BT share of residential voice call volumes by type


51.7

72.766.2

61.173.870.9

64.453.553.7

58.852.9

47.9 44.8 43.6 41.6

74.1

56.357.7

0

20

40

60

80

2002 2003 2004 2005 2006 2007

Mar

ket

shar

e (p

er c

ent) UK

geographiccalls

Internationalcalls

Calls tomobiles

352

Figure 5.27

Fixed telecoms lines

Source: Ofcom / operatorsNote: Includes estimates where Ofcom does not receive data from operators; broadband excludes corporate connections

5.1

1.7

7.2

5.14.9 4.7 4.7 5.0

4.2

0.6

12.2

9.9

3.43.12.72.01.40.8

35.2 35.0 34.6 33.733.634.1

0

5

10

15

20

2002 2003 2004 2005 2006 2007

Con

nect

ions

/ c

hann

els

(m)

0

10

20

30

40

Fix

ed li

nes

(mill

ions

)

ISDN channels

DSL

Cable modem

Fixed lines(right handaxis)

353

Figure 5.28


Carrier pre-selection, wholesale line rental and full LLU lines

0.82.3

4.2 4.53.8

3.5

2.1 1.4

0.3 1.0

0.6

2.6

4.6

5.96.6

6.9

0

2

4

6

8

2002 2003 2004 2005 2006 2007

Line

s (m

illio

ns)

Fully unbundledlines

CPS-only lines

WLR and CPSlines

Total CPS lines

354

Figure 5.29

13.3 13.3 13.7 13.0 13.4

4.0 4.6 3.7 3.8 3.7 4.11.8

7.413.2 17.0 18.8 17.5

3.1

19.1

25.4

30.734.2

36.338.0

13.1

0.3 0.8

0

10

20

30

40

2002 2003 2004 2005 2006 2007

Pro

port

ion

of t

otal

line

s (%

) Full LLU

CPS lines

Other directaccess

Cable

WLR lines(RHS)

Source: Ofcom / operatorsNote: Includes estimates where Ofcom does not receive data from operators; excludes lines using BT’s Wholesale Calls products

Share of fixed lines taking non-BT voice services

355

Figure 5.30

39.645.3

50.057.2

66.671.6 75.6 78.7 82.6

12.4 14.3 16.3 18.523.3 25.0 27.7 30.2 31.0 33.2

80.2

0.7 1.3 2.0 3.1 4.7 6.7 8.5 11.4 13.4 15.6

0

20

40

60

80

100

Q4 Q12006

Q2 Q3 Q4 Q12007

Q2 Q3 Q4 Q12008

Per

cen

t

Proportion ofpremises connectedto unbundled BTexchange

Proportion of BTexchanges that havebeen unbundled

Total proportion oflines that have beenunbundled

Proportion of unbundled exchanges and connected premises


356

Figure 5.31

Fully and partially unbundled lines


1.0 1.2

2.73.1

3.7

4.3

0.3

1.0

0

1

2

3

4

5

2004 2005 2006 2007 Q1 2008

Unb

undl

ed li

nes

(mill

ions

)

Partiallyunbundled

Fullyunbundled

357

Figure 5.32

Source: Ofcom / operators Note: Includes estimates where Ofcom does not receive data from operators

Estimated mobile retail revenue by service

7.6 8.6 9.7 10.3 10.7 11.4

2.22.7

0.1

0.20.4

0.7 1.01.0

8.7

10.512.0

13.113.8

15.1

1.1

2.11.8

1.7

0

5

10

15

2002 2003 2004 2005 2006 2007

Rev

enue

(£b

n)

Datarevenue

SMSrevenue

Voice andaccessrevenue

358

Figure 5.33


Estimated mobile retail revenue, by network operator

2.9 3.4 3.6 3.7 3.7 4.1

1.92.4 3.0 3.3 3.7 4.11.62.0

2.2 2.1 2.52.7

2.42.7

3.0 3.13.0

3.20.91.0

1.1

8.7

10.512.0

13.113.8

15.1

0.3

0

5

10

15

2002 2003 2004 2005 2006 2007

Ret

ail r

even

ue (

£bn)

3UK

Orange

T-Mobile (includingVirgin Mobile)

O2 (includingTesco Mobile)

Vodafone

359

Figure 5.34


Average monthly retail revenue per mobile subscription

13.39 14.05 14.37 13.71 13.15 13.29

2.68 3.150.130.35 0.64 0.87 1.22 1.14£15.39

£17.13 £17.74 £17.38 £17.05 £17.59

2.73 2.72 2.791.88

0

5

10

15

20

2002 2003 2004 2005 2006 2007

Rev

enue

(£p

er m

onth

)

Dataservices

SMSmessages

Voicecalls andaccess

360

Figure 5.35

Average monthly retail revenue per mobile subscription, by subscription type


£8.57

£33.94 £35.27 £35.81£33.06£32.54

£34.25

£7.73 £8.84 £8.83 £8.91 £9.10

0

10

20

30

40

2002 2003 2004 2005 2006 2007

Ave

rage

mon

thly

rev

enue

per

su

bscr

iptio

n (£

)

Contract

Pre-pay

361

Figure 5.36

Average mobile cost per voice minute, by customer type

Source: Ofcom / operatorsNote: Includes estimates where Ofcom does not receive data from operators; contract includes rental element; analysis of price per minute for contract calls incorporates monthly line rental which often includes a number of inclusive SMS messages (and sometimes data allowance); figures are calculated using actual minutes of usage

15.814.6

14.3 14.712.113.1

14.314.3

16.614.9

12.7

9.8

0

5

10

15

20

2002 2003 2004 2005 2006 2007

Pen

ce p

er m

inut

e

Contract

Pre-pay

362

Figure 5.37

14.1 14.6 14.9 17.2 21.1 27.3

37.9 44.3 49.153.9

61.1

72.152.058.9

64.071.1

82.2

99.4

0

20

40

60

80

100

2002 2003 2004 2005 2006 2007

Bill

ions

of

min

utes

Contract

Pre-pay


Mobile voice call volumes

363

Figure 5.38

17.6 22.1 26.233.4

43.3

58.8

17.622.1

26.3

33.6

43.5

59.1

0.1

0.2

0.2

0.3

0

20

40

60

2002 2003 2004 2005 2006 2007

Bill

ions

of

mes

sage

s

MMS

SMS


Mobile messaging volumes

364

Figure 5.39


Mobile subscriptions, by network operator

12.2 12.7 13.7 14.8 14.7 16.5

12.0 13.2 14.7 17.0 19.0 20.012.1 13.1

14.615.3 16.9 17.313.3 13.7

14.214.9

15.3 15.73.53.8

4.0

49.6 52.859.7

65.569.8

73.5

2.5

0

20

40

60

80

2002 2003 2004 2005 2006 2007

Sub

scri

ptio

ns (

mill

ions

)

3UK

Orange

T-Mobile (includingVirgin Mobile)

O2 (including TescoMobile)

Vodafone

365

Figure 5.40

34.0 35.6 39.8 43.2 45.4 47.2

15.6 17.219.9

22.2 24.4 26.449.6 52.859.7

65.469.8 73.5

31.4 32.6 33.3 34.0 34.9 35.9

0

20

40

60

80

100

2002 2003 2004 2005 2006 2007

Sub

scri

ptio

ns (

mill

ions

)

0

10

20

30

40

Pro

port

ion

cont

ract

(%

)

Contract

Pre-pay

Proportioncontract(RHS)

Source: Ofcom / operatorsNotes: Based on network operator reported figures; likely to overstate activity in reference quarter; includes estimates where Ofcom does not receive data from the operators

Pre-pay and contract mobile subscriptions

366

Figure 5.41

Source: Ofcom / operators / InformaNote: 3G connections defined as connections sold with 3G-capable handsets

UK 3G subscriptions by network operator

4.6

7.8

12.5

2.6

0.2

0.4

4.3

7.0

11.2

17.0

0

5

10

15

20

2002 2003 2004 2005 2006 2007

Sub

scri

ptio

ns (

mill

ions

) 3UK

Orange

T-Mobile

O2

Vodafone

As a % of allsubscriptions

367

Figure 5.42

Source: Ofcom / operatorsNote: Dial-up metered revenue figure is based on revenue paid to the telecoms provider not the element retained by the ISP

Estimated UK internet and broadband retail revenue

0.3 0.3 0.2 0.2 0.1

0.7 0.7 0.80.5 0.4

0.2

0.20.6

1.0 1.4 1.92.2

0.5 0.4

2.1

2.4

2.7 2.72.9 2.9

0.8 0.6

0.90.9

0

1

2

3

2002 2003 2004 2005 2006 2007

Rev

enue

(£b

illio

n)

SME

Residentialbroadband

Residentialunmeterednarrowband

Residentialmeterednarrowband

368

Figure 5.43

Source: Ofcom / operatorsNote: SME broadband includes some connections over leased lines

UK residential and small business internet connections

9.7 10.1 9.06.1

4.1 2.5

1.12.7 5.4

8.8 11.7 14.30.5

0.50.4 0.3 0.2

0.2

0.30.5

0.8 1.11.3

1.3

11.6

13.715.5

16.317.3

18.3

0

5

10

15

20

2002 2003 2004 2005 2006 2007

Con

nect

ions

(m

illio

ns) SME

broadband

SMEnarrowband

Residentialbroadband

Residentialnarrowband

369

Figure 5.44

Source: Ofcom / operatorsNote: Excludes connections made over cellular networks

UK residential and small business broadband connections

0.3 0.8 1.4 2.3 3.1 4.10.3 0.9

2.74.7

5.5 4.2

3.4

1.33.70.1

1.43.1

6.1

9.9

13.0

15.6

2.0

2.73.1

1.40.8

0.2

0

5

10

15

20

2002 2003 2004 2005 2006 2007

Con

nect

ions

(m

illio

ns)

Other

LLU DSL

Virgin Media cablemodem

Other non-LLU DSL

BT retail DSL

370

Figure 5.45

Source: Ofcom / operatorsNote: TalkTalk / AOL, Tiscali, BSkyB, Orange Home shares are indicative only

Estimated UK broadband service provision retail connection share

23.7 25.8 24.4 23.4 23.8 26.5

56.743.7

34.0 28.7 25.4 23.7

16.6 20.1 24.3 27.0 22.8 16.6

0%

20%

40%

60%

80%

100%

2002 2003 2004 2005 2006 2007

Pro

port

ion

of c

onne

ctio

ns (

%) Other

Orange Home

BSkyB

Tiscali

TalkTalk / AOL

Virgin Media

BT

371

Figure 5.46

Source: Ofcom / operators / IDC

UK business telecoms services revenue

5.0 4.6 4.2 3.8 3.5 3.4

3.6 4.0 4.6 5.1 5.8 6.7

0.6 0.6 0.6 0.5 0.40.3

2.72.811.3 11.6 11.8 12.0 12.4

13.2

2.5 2.62.32.2

0

5

10

15

2002 2003 2004 2005 2006 2007

Rev

enue

(£b

illio

n)

Corporate DataServices

SME internet

Mobile

Fixed voice

372

Figure 5.47

Source: Ofcom / operatorsNote: Excludes revenues from non-geographic voice calls

Average voice revenue per business fixed line

15.23 15.61 14.73 14.25 13.68 14.15

3.79 3.39 2.94 2.70 2.86 2.50

5.37 4.533.53 2.84 2.61 2.35

3.05 2.542.30 2.14 1.99 2.09

7.59 7.597.01

6.53 6.35 5.63

£35.04 £33.66£30.51

£28.46 £27.51 £26.73

0

10

20

30

40

2002 2003 2004 2005 2006 2007

£ pe

r m

onth

Calls to mobiles

International

National

Local

Line rental

373

Figure 5.48

Source: Ofcom / operatorsNote: Figures have been restated from the 2007 Communications Market Report to reflect more accurate data

Breakdown of business mobile revenue

3.4 3.8 4.2 4.5 5.15.8

0.20.3

0.40.5

0.80.9

3.64.0

4.65.1

5.8

6.7

0

2

4

6

8

2002 2003 2004 2005 2006 2007

Rev

enue

(£b

illio

n)

Data (inc. SMS)

Voice calls andrental

374

Figure 5.49

Business fixed voice call volumes

57.554.1

50.0

42.444.945.7

0

20

40

60

2002 2003 2004 2005 2006 2007

Cal

l min

utes

(bi

llion

s)

Source: Ofcom / operatorsNote: Excludes non-geographic voice call volumes

375

Figure 5.50

Source: Ofcom / operatorsNote: Excludes non-geographic voice call volumes

Average weekly outbound voice call volumes per business fixed line

37.1 35.1 33.1 30.7 29.9 28.6

45.3 42.3 38.6 35.5 35.3 32.1

5.85.8

5.75.3 5.8 6.1

11.712.3

12.412.6 14.0 13.2

99.9 95.489.7

84.0 84.980.0

0

20

40

60

80

100

120

2002 2003 2004 2005 2006 2007

Min

utes

per

wee

k Calls to mobiles

International calls

National calls

Local calls

376

Figure 5.51

Source: Ofcom / operatorsNote: Figures may be overstated due to an element of double-counting of WLR lines

Business fixed lines by type

6.2 6.0 5.9 5.7 5.4 5.3

1.6 1.7 1.6 1.5 1.5 1.4

3.2 3.2 3.2 3.1 3.2 3.6

11.0 10.8 10.6 10.3 10.1 10.3

0

2

4

6

8

10

12

2002 2003 2004 2005 2006 2007

Line

s /

chan

nels

(m

illio

ns)

ISDN30channels

ISDN2channels

PSTN lines

5.3: The telecoms user

378

Figure 5.52

32.05 30.15 28.10 25.58 24.03 22.56

25.04 29.55 33.00 33.65 32.58 32.73

5.72 7.07 8.49 8.85 9.87 9.45£62.80 £66.77 £69.60 £68.08 £66.48 £64.74

3.1%3.3% 3.4% 3.3% 3.3% 3.3%

0

20

40

60

80

100

120

2002 2003 2004 2005 2006 2007

£ pe

r m

onth

(20

07 p

rice

s)

0%

1%

2%

3%

4%

As

a %

of

tota

l exp

endi

ture Internet &

broadband

Mobile voice & text

Fixed voice

As a % of totalhousehold spend

Source: Ofcom / operators / ONSNotes: Includes estimates where Ofcom does not receive data from operators; adjusted to RPI; includes VAT

Real average household spend on telecoms services

379

Figure 5.53

Source: Ofcom / operatorsNote: Includes VAT; excludes non-geographic voice calls

Real cost of a basket of residential fixed voice services

12.14 11.87 12.07 12.17 12.36 12.18

4.19 3.70 3.20 2.88 2.62 2.76

2.01 1.67 1.20 0.93 0.92 0.87

2.221.94 1.64 1.47 1.49 1.28

4.874.52

4.08 3.71 3.70 4.08

£25.43£23.70

£22.19 £21.16 £21.09 £21.16

0

10

20

30

2002 2003 2004 2005 2006 2007

£ pe

r m

onth

(20

07 p

rice

s) Calls tomobiles

Internationalcalls

National calls

Local calls

Fixed access

380

Figure 5.54

Source: Ofcom / operatorsNote: Includes VAT; excludes non-geographic voice calls

Real cost of a basket of mobile services

8.85 9.62 10.29 10.05 9.27 9.41

2.93 2.99 2.80 2.28 1.88 1.24

11.85 8.75 7.025.33

4.13 2.72

9.048.82 8.12

7.055.75

4.56

£32.68£30.18

£28.23£24.70

£21.04£17.93

0

10

20

30

40

2002 2003 2004 2005 2006 2007

£ pe

r m

onth

Messaging

Off-net

On-net

UK fixed callsand rental

381381

Figure 5.55

6 9 7 7 5 5 4 3 6 5 8 13 15

31 22 19 23 24 21 17 19 19 22 21 17 20

47 52 55 50 51 54 59 62 62 56 54 53 49

9 9 12 12 13 12 14 13 9 11 10 13 137 8 8 8 8 9 6 4 4 7 6 5 3

0%

20%

40%

60%

80%

100%

Q12005

Q2 Q3 Q4 Q12006

Q2 Q3 Q4 Q12007

Q2 Q3 Q4 Q12008

Pro

port

ion

of c

ontr

acts

(%

)

£50.00+

£40-£49.99

£30-£39.99

£20-£29.99

£0-£19.99

Source: GfK retail dataNote: Based on new contracts with handsets, covers 94% of sales

Monthly line rental for new mobile contract connections

382382

Figure 5.56

88 8876 72

5844

34 25 19 16 15 12 14

12 1224 27

4155

66 74 80 84 84 87 84

1 1 1 1 1 1 1 1 2

0%

20%

40%

60%

80%

100%

Q12005

Q2 Q3 Q4 Q12006

Q2 Q3 Q4 Q12007

Q2 Q3 Q4 2008Q1

Pro

port

ion

of s

ales

(pe

r ce

nt)

24 months

18 months

12 months

Length of new mobile contract connections

Source: GfK retail dataNote: Based on new contracts with handsets, covers 94% of sales

383

Figure 5.57

Comparison of average fixed and mobile voice call charges


6.9

14.513.0

11.5

15.214.714.6

7.16.66.56.67.1

0

5

10

15

20

2002 2003 2004 2005 2006 2007

Pen

ce p

er m

inut

e

Mobile

Fixed

384384

Provider Broadband and fixed line

Broadband, fixed and mobile

Broadband, fixed and TV

Broadband, fixed, mobile, and TV

AOL 25.49 - - -

Be 24.50 - - -

BSkyB - - 26.00 -

BT 26.49 38.99 26.49 38.99

O2 23.00 38.00 - -

Orange 22.50 37.00 - -

PlusNet 19.98 - - -

TalkTalk 16.39 - - -

Tiscali 14.99 - 19.99 -

Virgin Media 20.00 30.00 30.00 40.00

Vodafone 35.00 40.00 - -

Source: Pure Pricing UK Broadband, Bundling and Convergence Update, June 2008Notes: Includes £10.50 BT line rental as relevant; lowest cost option / lowest price combination is shown; activation charges and promotional discounts are excluded; mobile options may be SIM-only; allowances for fixed-line and mobile calls, plus availability of TV channels included within packages may differ by operator and option

Lowest cost broadband options from major suppliers, June 2008 (£ per month)

Figure 5.58

385

Figure 5.59

Household penetration of key telecoms technologies


5258

90 90 88

909392 939390

8980

85

4250

57 60 64 67

4127

114

0

20

40

60

80

100

Q4 2002 Q4 2003 Q4 2004 Q1 2006 Q1 2007 Q1 2008

Pro

port

ion

of a

dults

(%

)

Fixedtelephony

Mobiletelephony

Internetconnection

Broadbandinternet

386

Figure 5.60

5 5

71

512

48

9

23

38

0

20

40

60

80

Fixed line only Mobile only Broadband

Pro

port

ion

of a

dults

(%

)

ABC1

C2

DE

Household telecoms connections, by socio-economic group

Source: Ofcom research, Q1 2008Base: All respondents

387

Household telecoms connections across urban areas

7967 62 70 69 65 67

811 10

8 10 10 6

12 22 28 21 20 23 27

0%

20%

40%

60%

80%

100%

UK

ave

rag

e

Bir

min

gh

am

Gtr

M'c

ste

r

Liv

erp

oo

l

Gla

sgo

w

Be

lfast

Lo

nd

on

de

rry/

De

rry

Pro

port

ion

of h

ouse

hold

s (%

)

Neither fixednor mobile

Mobile only

Fixed only

Fixed andmobile

Source: Ofcom research, Q1 2008Base: All respondents

Figure 5.61

388

Figure 5.62

Source: Ofcom research, July 2008

Use of more than one SIM by UK mobile usersHow many mobile phones or SIM cards with different telephone numbers do you currently use?

489

1311

97

1

2

22

1

1

1

11

1

0%

5%

10%

15%

20%

Total 16-24 25-34 35-44 45-54 55-64 65+

% o

f ad

ult

mob

ile u

sers

Four or more

Three

Two

389

Figure 5.63

Source: Based on Enders Analysis, UK Mobile user survey, April 2008

Breakdown of difference between mobile users and mobile connections

49.0

9.0

7.71.0 0.7

7.7

49.0

26.1

0

20

40

60

80

Mobile users(adults andchildren)

Inactive SIMs Barely activeSIMs

Datacards Additionalemail devices

Additionalmobilephones

Reportedconnections

Mill

ions

75.1

390

Figure 5.64

Tendency to use one main SIM, among multiple-SIM users

43 43 44

44 40 40

6 11 75 4 71 1 1

0%

20%

40%

60%

80%

100%

I have one SIM card /number on which I make the

majority of calls / texts

I have one SIM card /number on which I receivethe majority of calls / texts

The SIM card on which Imake most of my calls /

texts is the same as that onwhich I receive most of my

calls / texts

Stronglydisagree

Disagree

Neither agreenor disagree

Agree

Strongly agree

Source: Ofcom research, July 2008Base: Adults 16+ who personally use more than one SIM card

391

Figure 5.65

Reasons for multiple SIM ownershipWhat is the main reason you have more than one phone or SIM card with different numbers?

35%

13%

12%

10%

6%

4%

3%

3%

2%

13%

0% 10% 20% 30% 40%

To separate numbers for work and personal calls

It's useful to have more than one personal mobile number

Many of my contacts still use an old number

I have a back-up in case I run out of credit

To take advantage of lower prices available from different operators

So my friends can call / text the number which offers them the lowest price

So I can separate calls I make in the UK with calls I make while overseas

So I can separate calls to numbers in the UK from calls to abroad

I have a separate phone or SIM card for emails / using the internet

Unsure

Source: Ofcom research, July 2008Base: Adults 16+ who personally use more than one SIM card

392

Figure 5.66

Household PC and internet penetration


57

411

27

41

5258

64 65 67727169

5357

63 6467

0

20

40

60

80

Q4 2003 Q4 2004 Q4 2005 Q4 2006 Q1 2007 Q1 2008

Pro

port

ion

of h

ouse

hold

s (%

)

PCpenetration

Internetpenetration

Broadbandpenetration

393

Figure 5.67

45

2316

11 114 5

0

10

20

30

40

50

Don't useinternetenough

Too expensive Satisfied withcurrent

connection

Don't needfaster speeds

Too muchhassle tochange

Not availablein my area

Other

% o

f th

ose

unlik

ely

to g

et b

road

band

Reasons for not taking up broadband

Source: Ofcom research, 2007Note: Multi-code questionBase: All without broadband

394

Chart 5.68

Location of internet access

Source: Ofcom research, January 2008

25

15

14

7

5

2

64

27

13

13

6

5

3

61

0 20 40 60

At home

At work

In someone else's home

In library or educational institution

In internet café, shop or kiosk

Anywhere via a portable device

At other locations

Proportion of internet users 15+ (%)

Q1 2008

Q1 2007

71% of UK adults use the internet

395395

Figure 5.69

Source: Ofcom research, January 2008 Base: All adults with broadband

Awareness and use of VoIP

68

14

77

20

72

18

73

140

20

40

60

80

Awareness of VoIP Currently using

% o

f br

oadb

and

user

s 15

+

Q4 2005

Q4 2006

Q1 2007

Q1 2008

396

Figure 5.70

Source: Ofcom / operatorsNote: Excludes non-geographic voice calls

Average monthly voice call volumes per residential fixed line

184.2 186.2 187.4 183.7 178.8 162.1

81.1 77.9 77.6 76.2 74.568.1

10.0 10.2 10.5 10.1 9.610.2

28.1 29.4 30.4 30.3 29.326.4

303.3 303.8 305.9 300.2 292.2266.8

0

100

200

300

400

2002 2003 2004 2005 2006 2007

Min

utes

per

wee

k

Calls to mobiles

International calls

National calls

Local calls

397

Figure 5.71

Source: Ofcom / operatorsNote: Excludes 3UK; ‘Other calls’ include roaming, premium rate calls, WAP calls and all other call types

Average monthly outbound voice minutes per mobile connection

39.5 38.0 34.9 32.3 31.8 32.3

29.6 31.4 30.1 28.4 30.3 36.4

13.4 16.9 19.4 21.3 25.731.71.3 1.3 1.2 1.2

1.3

1.6

8.1 8.3 9.3 11.712.4

13.791.9 95.9 94.8 94.8

101.4

115.6

0

30

60

90

120

2002 2003 2004 2005 2006 2007

Min

utes

per

wee

k

Other

International

Off-net

On-net

UK fixed

398

Figure 5.72

Average outbound mobile minutes, by customer type

Source: Ofcom / operatorsNote: Includes estimates where Ofcom does not receive data from operators; excludes 3UK

35

214225 220 237219213

36 33 35 40 49

0

50

100

150

200

250

2002 2003 2004 2005 2006 2007

Min

utes

per

mon

th

Contract

Pre-pay

399

Figure 5.73

31 36 39 4453

68

0

20

40

60

80

2002 2003 2004 2005 2006 2007

Mes

sage

s pe

r m

onth

Picturemessages

Textmessages

Monthly outbound messages per mobile connection

Source: Ofcom / operatorsNote: Excludes 3UK

400

Figure 5.74

Residential consumer satisfaction with fixed and mobile services

Source: Ofcom researchNote: Includes only those who expressed an opinion

5132

49 46 43 45 5235

5432

5030

41

56 29 3248 48 40

5932

5433

58

92

78 77

93 9486 86 8388

91 9288

0

20

40

60

80

100

Q1

2006

Q1

2008

Q1

2006

Q1

2008

Q1

2006

Q4

2007

Q1

2006

Q1

2008

Q1

2006

Q1

2008

Q1

2006

Q1

2008

% o

f ad

ults

15+

with

ser

vice

Very satisfied

Satisfied

Fixed Mobile

Overall Value for money

Reliability Overall Value for money

Accessing the network

401

Figure 5.75

Residential consumer satisfaction with aspects of broadband service

Source: Ofcom researchNote: Includes only those who expressed an opinion

48 5034

51 5233

47 5034

44 3855

33 2650

43 3449

92 8978

8390

84 8388 84

0

20

40

60

80

100

Q1

2006

Q1

2007

Q1

2008

Q1

2006

Q1

2007

Q1

2008

Q1

2006

Q1

2007

Q1

2008

% o

f ad

ults

15+

with

ser

vice

Very satisfied

Satisfied

Overall Value for money

Speed of service

402

Figure 5.76

Source: Ofcom research, Q1 2008 Base: All with broadband

Are broadband speeds are meeting expectations?

A lot slower, 6%

Unsure, 8%

A little slower,

14%

A little faster, 20%

A lot faster, 10%

About the same, 44%

403

Figure 5.77

3438

21

3540

26

3741

27

0

10

20

30

40

Fixed line Mobile Internet / Broadband*

% o

f ad

ults

15+

with

ser

vice

Q2 2006

Q2 2007

Q1 2008

Proportion of consumers who have ever switched provider

Source: Ofcom research *Note: 2008 data is the proportion of broadband consumers who had ever changed broadband provider, and is not directly comparable with 2006 and 2007 data which is the proportion of internet consumers who had ever changed internet provider

404

Figure 5.78

37 34 3248 47 41

3118 20

36 42 39

35 35 3841

43 41

67

96 6 7

914 15

5 3 52 2 3

4 8 816 13 15 9 11 11 15 17 15

0%

20%

40%

60%

80%

100%

Q42005

Q42006

Q42007

Q42005

Q42006

Q42007

Q12006

Q12007

Q32007

% o

f th

ose

who

hav

e sw

itche

d

Unsure

Very difficult

Fairly difficult

Fairly easy

Very easy

Source: Ofcom research, Q2 2008Base: All adults who have ever switched

Ease of switching supplier

Fixed line Mobile Internet

405405

59%

13%

26%22%

18%

74%

61%

45%

22%

65%

40%

81%89%

70%65%

74%

4%

57%

4%

35%

66%

77%

95%

61%

0%

20%

40%

60%

80%

100%

Internet Mobile phone Use the internet Use a mobile phone

Boys aged 5-7

Girls aged 5-7

Boys aged 8-11

Girls aged 8-11

Boys aged 12-15

Girls aged 12-15

Child uses almost every day

Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in April to May 2008Base: Children aged 5-15 (132 Boys aged 5-7, 150 Girls aged 5-7, 189 Boys aged 8-11, 178 Girls aged 8-11, 187 Boys aged 12-15, 189 Girls aged 12-15)

Owned or able to access by child

Figure 5.79

Children’s ownership and use of the internet and mobile phones

406406

Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in April to May 2008Note: Yellow arrow indicates statistically significant differences from Q2 2007Base: Children aged 5-15 who use the internet at home (157 aged 5-7, 253 aged 8-11, 304 aged 12-15)

21%28%

4% 7%3%

7%

63%

52%

25%20%

28%

19% 20% 21%

9% 7%3%

80%

65% 62%54%

47%43%

38%

19% 16% 19%

11%19%

49%

2%

49%

11%

47%

24%

0%

20%

40%

60%

80%

100%

Schoolw ork/

homew ork

Look forinformation

Play gamesonline

InstantMessaging

Go ow ebsites likeMySpace or

Bebo

Go to sitesw here you

w atch video,pictures and

music

Emails Dow nload orplay music

Go to TVprogrammew ebsites

Go to sitesabout new s

Go tow ebsites like

HabboHotel…..

Go to sitesw here…(blogs/Wikis)

Listen toradio online

5-7 year-olds 8-11 year-olds 12-15 year-olds

Significant differences between 2007 and 2008

-10

+8

-9

Figure 5.80

Uses of the internet by children

407

407

60%

52%

35%30%

16%

33%

14%

6%2%

6%

86%

71%

55%48%

32% 30%24%

12%8%

12%

0%

20%

40%

60%

80%

100%

Send orreceive textmessage

Make voicecall

Take photos Listen tomusic

Take videos Play games Send orreceive photo

messages

Send orreceive video

clips

Access theinternet

Other

8-11 year-olds

12-15 year-olds

Children’s use of mobile phones

Children use almost every dayBase: Children aged 8-15 with their own mobile phone (213 aged 8-11, 347 aged 12-15). NB Base too small for 5-7 year olds.Source: Ofcom research, fieldwork carried out by Saville Rossiter-Base in April to May 2008

-7

-11 -15+7 +11

+4

+9

significant differences between 2007 and 2008

Figure 5.81

Ofcom UK CMR 2008 Charts

Business

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