The latest research from uSwitch reveals that prices of standalone broadband packages in the UK have fallen by 36% and are 'up to' 16 times faster (advertised speeds) than they were in 2004. Nearly 15 million households now spend over £3 billion subscribing to a service.
AOL UK is credited with the biggest fall in price, going from £28 for a 0.5Mbps (512Kbps) service in 2004 to £15 for an 8Mbps service in 2008, a drop of 46%. However, AOL's prices are typically more expensive for those not using their unbundled network (i.e. BT users), which is not stated in the press release.
Despite that, uSwitch claims that 5 million households are paying more than the going rate for their broadband, "wasting" £162 million a year:
uSwitch.com has compared the average price for the most popular speed in January 2004 against the same for 2008. Four years ago, customers could expect to pay an average of £27 a month for broadband with a standard speed of just 0.5Mb. Today, the majority have signed up to a headline speed of 8Mb costing an average of £17 a month. This is a saving of £120 a year for a service 16 times as fast.
The broadband market is dominated by the same key players that first piped high speed internet into homes four years ago, but while some companies have slashed prices by as much as 46%, others have dropped their charges by just 29% – a difference of 17%.
Dearest to cheapest
AOL shared the top spot with Orange for the most expensive 0.5Mb broadband 4 years ago. However, it now offers one of the lowest priced standalone 8Mb services on the market. At £15 a month, this is a price decrease of 46%.
Still the most expensive
At £28 a month, Orange offered the joint most expensive 0.5Mb broadband in December 2003. Today it offers the most expensive standalone 8Mb service, at £20 a month. This decrease of just 29% over 4 years is well below the average drop of 36%.
2Mb price drop
Telewest 2Mb broadband cost £50 a month at the end of 2003. Now rebranded as Virgin Media, it offers 2Mb broadband for £18 a month, a price decrease of 64%. Of all the major suppliers, only Virgin Media offers standalone broadband packages at more than one speed.
Today’s cheapest 8Mb
With Orange offering the most expensive 8Mb standalone broadband package, Plusnet currently offers the cheapest. At just £10 a month, the service is half the cost of its dearest rival.
The fastest broadband in December 2003 was a 2Mb package from Telewest. Today, Virgin Media remains the speed pioneer. It is planning to roll out a 50Mb service by the end of 2008.
Unfortunately uSwitch's research only appears to focus on the industries big name providers, almost entirely ignoring smaller ISP's. Likewise while some services may be cheaper, this does not mean to say that you get value for money; paying less frequently means receiving a lower quality of service and support.
Finally the research only appears to reference speeds and price, usage restrictions such as traffic management or caps get no mention, making for a somewhat shaky comparison.