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Economic slowdown affects broadband market

Only 200,000 households signed up in Q4 of 2008

The economic slowdown is affecting the number of UK households signing up for broadband access, says Point Topic.

According to the market research company, only about 200,000 households signed up for broadband subscriptions in the last quarter of 2008. That's less than half that forecasted before the third-quarter financial sector crisis.

Numbers were expected to be down compared to the 620,000 households signing up for broadband during the fourth quarter of the previous year, but not by that much, according to Tim Johnson, chief analyst at Point Topic.

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BT Wholesale and its resellers together lost about 300,000 household broadband subscribers. ISPs using local loop unbundling to provide broadband services, including Carphone Warehouse, Sky, Tiscali and Orange did a bit better and added nearly 430,000 households among them, according to Point Topic.

Broadband will continue to slowly grow, but increasing overall internet penetration will be a bigger challenge. Currently, broadband growth mostly comes from households moving from dial-up internet connections. However, overall internet growth has come to a halt and nine million homes are still without access.

Bringing the internet to homes and businesses that are completely without access would be a good choice, if the UK government wants to spend money to stimulate economic growth, Johnson said.

See also: Average UK broadband speed is 3.6Mbps


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