Dramatic and accelerating changes across all communications
Posted:Thursday, August 10, 2006

Today August 10 2006, Office of Communications, Ofcom published its annual Communications Market Report for 2005 revealing new trends in the television, radio, telecommunications, and wireless communications industries.

According to the report, the number of households with broadband connections now totals 9 million with the number of households with digital television at 18.3 million.

31% of all call minutes are from mobile phones with the number of households using their broadband connections to make low-cost or free Voice over Internet phone calls at 1.8 million by the end of 2005.

The Report reveals striking evidence that a new ‘networked generation’ is turning away from television, radio and newspapers in favour of online services , including downloadable content – used on multiple devices such as iPods and mobile phones – and participation in online communities.

The Ofcom report reveals that television is almost irrelevant to 16-24 year olds as they on average watch television for one hour less per day than the average television viewer.

The internet plays a central role in daily life; more than 70% of 16-24 year old internet users use social networking websites compared to 41% of all UK internet users and 37% of 18-24 year olds have contributed to a blog or website message board compared to 14% of all UK internet users.

Extensive use of the internet has also influenced 15-24 year olds’ consumption of other media. Their radio listening is lower, by an average of 15 minutes a day compared to the wider population; additionally, 27% of those surveyed said they read newspapers less as a consequence of their online usage.

The gap between BBC and commercial radio audience share widened even further in 2005. Compared to 2001, when the margin was 13% in the BBC’s favour, the gap has more than doubled.

Overall digital listening (including radio channels via digital television) accounted for 11% of all listening hours in 2005, compared to 6% in 2004.

Subscription revenue remains the largest source of funding for commercial television, with 2005 revenues up by 8.5% to £3.9 billion for all pay TV services, £343 million more than total net television advertising revenues for the same period. Overall, television industry revenues increased by 4% year on year to more than £10.6 billion.

Online advertising revenues have increased almost eight-fold in real terms between 2001 and 2005 - from £0.17 billion to £1.3 billion per year. Online advertising revenue is now almost three times greater than radio advertising revenue and over one-third that of television advertising revenue and now stands at £3.8 billion.

Broadband continues to demonstrate significant growth with 11.1 million UK homes and small businesses with broadband connections.

Mobile phones play an increasingly important role in consumers’ daily lives. As many UK households now have a mobile phone as have a landline phone; and for the first time, the proportion of households relying on mobile phones exclusively (10%) is the same as the proportion who only use landline phones.

Mobiles are becoming the preferred means of making calls in many households, including those with both mobile and landline phones.

Mobile industry revenues grew by 9.7% year on year to £13.1 billion, while traditional landline revenue fell by 7.5% to £10.1 billion.