The UK telecoms regulator, Ofcom, has released a European Broadband Scorecard comparing the UK’s performance in broadband and mobile broadband with European countries. The regulator has been tasked with proving that progress is being made towards the UK Government’s ambitious goal that the UK ‘should have the best superfast broadband network in Europe by 2015’.
This sounds like a great idea. All telecoms regulators should be compelled, by government and industry, to benchmark their country’s performance with the rollout of mobile and fixed broadband against its peers. The UK government has required Ofcom to compare the UK’s performance with European countries on fixed, superfast (this is called high-speed in other countries) and mobile broadband on a) coverage and take-up; b) speed; c) price; and d) choice (of provider). These all essential considerations for those companies which are investing in new business areas or changing their business practices in ways that require ubiquitous mobile Web coverage (see below for examples).
Smoke and mirrors
Unfortunately this isn’t the exercise in transparency that it first seems.
The first problem is that the data used isn’t new. Some of the data focuses on the situation back in 2012. It was collected by Point Topic and was first published in the European Commission Digital Agenda Scoreboard, in June 2013. This begs the question: why do national regulators need to rely on third-parties to tell them how their country is progressing on mobile, fixed or high-speed broadband? Surely it’s the national regulator’s job to know – and publish – the latest stats for their country and to co-operate with other national regulators to share the latest stats for international comparison.
The second problem is the way the data is used/presented and interpreted or simply omitted. There are four issues here.
• First, Ofcom has chosen to compare UK’s broadband performance against only four countries: Germany, France, Spain and Italy – to which it compares favorably on fixed, mobile and high-speed broadband. These together with the UK are the largest economies in the EU, but when you look at data for the whole of the EU (see the graphs below) they are not the leaders. EU-wide data is available in Ofcom’s report but only in the annex at the end.
• Second, Ofcom has muddied some of the data by unnecessarily simplifying it by grouping countries into bands of percentages, so countries with 95, 96, 97, 98, 99, 100 percent coverage all become 95-100 percent. This issue is demonstrated below when you compare the way that data on mobile broadband coverage is presented by Ofcom and the EC reports.
• Third, Ofcom omits to include data on rural coverage. Again this only becomes clear when you look at how the same data from Point Topic is represented EC Digital Agenda Scoreboard. Where Ofcom just provides data on national mobile, fixed and superfast broadband coverage, the EC report shows rural coverage as well as national coverage – rural coverage is still a big problem in some countries as you can see from the mobile broadband graph below.
• Fourth, Ofcom omits to include data on LTE or 4G – this is the high-speed mobile broadband currently being rolled out at different rates across the world. The EC report contains comparison data on LTE/4G, but this has been left out of the Ofcom report – looking at the stats (below), you have to wonder if Ofcom was too embarrassed to include it.
Focusing on the EU5 rather than Europe
With headlines like Britain leads Europe in superfast broadband race (The Times, March 13, 2014), the Ofcom report is a PR coup. If the report had focused on Europe as a whole, rather than just the EU5 (Germany, UK, France, Spain and Italy) the headlines wouldn’t be so flattering. When you look at the European stats, which Ofcom should be – remember the UK wants to be number one for superfast broadband in Europe, not just the EU5 – Britain doesn’t lead Europe in superfast broadband, fixed broadband, mobile broadband (these are all found in the annex of the Ofcom report) or high-speed mobile broadband (excluded from the Ofcom report).
While mobiThinking is more concerned about mobile broadband and high-speed mobile broadband – as arguably everyone (business, governments alike) should be – let’s focus for a moment on what the UK calls “Superfast” fixed broadband. This is broadband with a download speed exceeding 30 Mbps. The EC just calls it high-speed broadband. Arguably the term “Superfast” should be reserved for 100 Mbps lines, which are already taking off in countries like Sweden where it used by 8.1 percent of the population, compared with just 0.3 percent in the UK (see Figure 38, EC Digital Agenda Scoreboard).
When you look at high-speed broadband, for the EU as a whole – found in the annex of the Ofcom report – you find the UK is actually sharing eighth place, with 70-75 percent coverage. Belgium, Netherlands and Malta look more like the European leaders with 95-100 percent coverage (Figure 25 in the Ofcom report). Similarly if you look at the data for the EU as a whole for high-speed broadband connections per 100 people (Figure 29 in the Ofcom report), the UK is in thirteenth place with 9 percent penetration. The European leaders have more than double this: Netherlands (22 percent) and Belgium (19 percent).
Mobile broadband take-up and coverage
Now to the more interesting stuff: how European nations compare for mobile broadband. This data is also buried in annex at the end of the Ofcom report. First, let’s look at mobile broadband penetration, i.e. the proportion of the population with a mobile broadband subscription, across the EU27. This highlights well how the UK outperforms the rest of the EU5 on the mobile broadband penetration, but at 84 percent, it is still considerably behind the leaders: Finland (107 percent), Sweden (106 percent) and Denmark (98 percent).
Figure 1: EU Mobile broadband connections per 100 people (Source: Digital Agenda Scoreboard via Ofcom)
Take up, however, is only part of mobile broadband story – the more important bit is coverage. So while take-up measures the number of people who have a package that includes Web access, coverage governs their ability to actually use the Web, wherever they are. There are two strands to coverage: the first concerns population coverage – i.e. where people live – and the second concerns geographic coverage (arguably more important with mobile technologies). That’s why it is important to know both national coverage and rural coverage. Rural coverage considers how good coverage is outside the main population centers for a country. Rural coverage remains a big issue in some countries.
The following graph from Ofcom’s report only considers national coverage. It does not include rural coverage. This seems odd, because this rural data is available from the same source Point Topic and is included in the graph from the EC Digital Agenda Scoreboard, which is included below for comparison. Closer inspection of the EC graph suggests rural coverage is considerably better in 15/27 European countries than in the UK – this includes countries with more geography to cover than the UK, including France, Spain, Sweden, and Finland.
The other thing that is odd about Ofcom’s graph is that the Point Topic data has been rounded, so nations with any coverage from 95 to 100 percent coverage, 21 of 27 nations, including the UK, all become equal first in the standings. However when you look at the graph in the EC Digital Agenda Scoreboard, which appears to be drawn from the same 2012 Point Topic data, the UK isn’t equal first as Ofcom claims, but fourteenth (and third in the EU5).
This might sound like splitting hairs, but the difference between 99 percent coverage and 95 percent coverage for mobile user is five times as many failed attempts to access the Web or email or find out where you are… and that is in a populated area. When you compare 98 percent rural coverage, as in Sweden, with 85 percent rural coverage, as in the UK (see the EC Digital Agenda Scoreboard graph, below), that means seven times more failed attempts to access the Web when you’re out of the city.
Figure 2: Percentage of households in areas served by mobile broadband (Source: Point Topic via Ofcom).
Now compare this graph from EC Digital Agenda Scoreboard, which appears to be taken from exactly the same Point Topic data from the end of 2012.
Figure 3: EC: HSPA coverage, end of 2012 (Source: Point Topic via EC Digital Agenda Scoreboard)
What about high-speed mobile broadband? 4G?
There are two main types of mobile broadband network: 1) HSPA or third-generation (3G) networks, and 2) LTE or fourth-generation (4G) networks, which bring a much richer and reliable mobile Web experience. Helped by heavy advertising by network operators and media hype, there’s now considerable awareness of 4G among consumers, but the speed of user adoption and network rollouts differs greatly between countries. Arguably any document that measures a country’s mobile/fixed broadband performance against its peers has to include progress with LTE/4G? So why is it omitted by the Ofcom document?
The following graph is taken from EC Digital Agenda Scoreboard again using data from Point Topic. This shows the position of EU nations for LTE coverage at the end of 2012. Arguably the data is old data, but it’s the same age as the other data from Point Topic that is published in the Ofcom report… or perhaps it’s just a bit embarrassing. This shows the UK in 19th place in the EU for LTE, with 18 percent penetration, and no rural coverage, considerably behind the EU average of 26 percent and 10 percent rural coverage. At the other end of the scale you have Sweden with more than 93 percent LTE population coverage and 70 percent rural coverage. Among the EU5, Germany impresses with 52 percent LTE penetration and 50 percent rural coverage.
Figure 3: LTE/3G coverage in the EU, end of 2012 (Source: Point Topic via EC Digital Agenda Scoreboard)
mobiThinking notes that in an open letter to a UK government minister published this week, Ofcom refers to some research by Enders Analysis predicting that the UK is now ahead of the other members of the EU5 with its LTE/4G roll out – which would be impressive considering how far the UK was behind Germany a year ago. The letter also estimates that 4G is currently used by 4 million people (this is about 6 percent of the UK population). It is unclear why this research isn’t included in Ofcom’s report.
Why it is essential that regulators publish accurate data about the state of the mobile Web
This comes down to one word: investment. If governments, regulators and telecoms companies want businesses to invest in mobile, they have got to prove the country’s mobile infrastructure is ready. This isn’t just about encouraging companies to build mobile e-commerce sites to sell to the country’s huge mobile market – though that is an important part of it – it is about encouraging a) the mobilization of the business and b) embracing the Internet of things.
a) The mobile workforce
Equipping workers with mobile devices and mobile access to business applications that enable them to work from wherever they are, at home, on the train, at a client location, brings huge potential efficiency savings for a business. The main weak link is connectivity (though price might also be an issue). If companies can not rely on employees being able to connect, they won’t invest in mobility.
The following graph, again taken from the excellent EC Digital Agenda Scoreboard shows the extent to which companies in different countries are mobilizing their work force. Note how Finland is top with 78 percent – now cross reference the 3G and 4G coverage. Is it a coincidence that the country has excellent 3G coverage (city and rural) and very good 4G coverage (though not so good in rural areas)? Finland also has the highest penetration of dedicated data-only SIMs at a remarkable 70.9 percent (Communications Committee, EC Digital Agenda Scoreboard Figure 73), vastly outnumbering fixed broadband connections at 30.6 percent (EC Digital Agenda Scoreboard Figure 24), which also demonstrates that where mobile connectivity is good enough, people will switch from fixed to mobile connectivity for PCs and other non-voice devices. Perhaps price of data is a factor also – it would be interesting to see a comparison between Finland and other European states.
Figure 4: Enterprises providing portably devices for mobile connection to the Internet, across EU nations, 2012 (Source: Eurostat via EU Digital Agenda Scoreboard)
b) Internet of things
There’s a lot of hype around the Internet of things. It was one of the major themes at Mobile World Congress. Cisco suggests that we could see 50 billion things connected to the Internet in 2020… but that’s not going to happen unless countries have ubiquitous mobile broadband.
Think about it: what gas/electricity supplier is going to install smart gas/electricity meters in all properties unless there is a 100 percent chance that there is a guaranteed connection? Arguably coverage is even more important to connected things than humans, because the machine can’t walk down the garden or climb a hill to get a mobile connection.
Look at the following graph: 24.8 percent of SIM cards in Sweden are machine-to-machine (M2M) – that’s way ahead of the next countries, Denmark and Finland with 7.2 and 7.1 percent. Could this happen if it did not have the best 3G and 4G coverage in Europe?
Figure 5: Share of machine-to-machine SIM cards for EU nations, October, 2012 (Source: Communications Committee via EU Digital Agenda Scoreboard)
Conclusion: the responsibility of regulators
mobiThinking welcomes Ofcom’s move to release a report which benchmarks the performance of the UK against its peers, but sees considerable room for improvement. This provokes the following recommendations:
• All regulators should regularly publish up-to-date information on the state of the telecoms market – mobile and fixed (but let’s focus on mobile). This should include mobile broadband (3G and 4G) subscribers and coverage and average prices for various data packages.
• This should include detailed coverage maps for each operator. In the future, mobile networks will have to compete on their proven nationwide geographical 3G coverage. Gas suppliers et al will choose a provider that can guarantee coverage. It is the regulator’s responsibility to provide accurate up-to-date data on 3G/4G coverage for each operator. If networks are unable to guarantee broadband coverage they need to be coerced into network sharing deals.
• Regulators should collect their own data, it is ludicrous to rely on second-hand, old, third-party data. Regulators are in the perfect position to demand data direct from the operators.
• Regulators should strike deals to share data with their international counterparts, to allow international benchmarking of a country’s performance.
• Disclosure of information should be full, transparent and impartial. It is not the job of regulator to seek good PR for its country – its responsibility is to provide a true report on the state of telecoms in the country. Companies depend on this data to make business decisions, so if there is uncertainty about the information, those companies will make mistakes or will not invest, neither of which is good news for the regulator’s country or the mobile businesses it represents.
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