International Communications Market Report 2008 Final chart pack

Overview 1.1 Introduction and summary (no charts) 1.2 The UK communications industry in context 1.3 The UK communications consumer in context 1.4 The regulatory landscape

1.1 Introduction and summary (no charts)

1.2 The UK communications industry in context

1.3 The UK communications consumer in context

1.4 The regulatory landscape

1.2 The UK communications industry in context

Figure 1.1 6.2% 5.2% 6.2% 7.3% 1.4% 3.6% 6.1% 5.6% 1yr 5yr Growth Source: Ofcom analysis based on Ofcom (UK), IDATE (telecommunications) with the remiaing data taken from PWC Global Entertainment and Media Outlook 2008-2012. Notes: Data calculations and interpretation are solely Ofcom’s responsibility. Ofcom has used an exchange rate of $2.001 to the pound, representing the OECD average for 2007. Global communications revenue

Figure 1.2 £300m 3.4% 3.4% Total in 2007 Year on year growth 5 year CAGR £122m 4.4% 5.1% £19m -0.1% 2.5% Growth YOY 1.2% 6.0% 4.6 2.6 -0.8 4.3 5.3 5yr CAGR 1.3 6.1 4.5 5.5 1.8 4.5 4.9 TOTAL £70bn £19bn £210bn £28bn £42bn £32bn £39bn £440bn 3.5% 3.8% Source: Ofcom analysis based on Ofcom (UK), IDATE (telecommunications) with the remiaing data taken from PWC Global Entertainment and Media Outlook 2008-2012. Notes: Data calculations and interpretation are solely Ofcom’s responsibility. Ofcom has used an exchange rate of $2.001 to the pound, representing the OECD average for 2007. Communications revenue, by among larger countries: 2007

Figure 1.3 5 year communications sector CAGR Communications sector growth rates, (% per annum) Source: IDATE for telecommunications/TV and PWC Global Entertainment and Media Outlook 2008-2012 for radio Note: Data calculations and interpretation are solely Ofcom’s responsibility Five year average growth rates across communications industries 4.9% 5.1% 1.8% 5.5% 4.5% 6.1% 1.3% 3.8%

Figure 1.4 Total Telecoms TV Radio 25% 26% 25% 8% 21% 21% 21% 7% 10% 9% 10% 13% 30% 24% 56% 24% 19% 16% 27% 8% 29% 29% 28% 22% 7% 4% 16% 8% 18% 15% 25% 10% Growth since 2002 Communications sector revenue per head Source: IDATE for telecommunications/TV and PWC Global Entertainment and Media Outlook 2008-2012 for radio Notes: Data calculations and interpretation are solely Ofcom’s responsibility. Ofcom has used and exchange rate of $2.001 to the pound, representing the OECD average for 2007. Growth rates in bold denote that it ranks first or second in that sector. Communications revenue, by sector, per head: 2007

Figure 1.5 Proportion of total advertising spend (%) Source: World Advertising Trends 2008, published by the World Advertising Research Center Proportion of advertising spend allocated to TV, radio and internet

UK FRA GER ITA US CAN JPN POL ESP NED SWE IRL Figure 1.6 Change in share of total advertising spend (percentage points) Source: World Advertising Trends 2008, published by the World Advertising Research Center Change in market shares of advertising segments, 2006-2007

Figure 1.7 Source: Ofcom calculations based on Yahoo! Finance data Telecommunications equity price trends versus market indices

Figure 1.8 Source: Ofcom calculations based on Yahoo! Finance data Media equity price trends versus market indices

1.3 The UK communications consumer in context

Figure 1.9 Fixed line penetration (per 100 people) Mobile penetration (per 100 people) Fixed line: general pattern of reduction penetration across the larger comparator countries (pink shading represents reduction since 2006) Mobile: growing take-up among all the larger comparator countries. Substantial growth in Italy and Germany since 2006 Take-up per 100 people -1 -5 -4 -1 -3 2007 Reduction since 2006 Source: Ofcom calculations based on IDATE data Note: Figures may not exactly sum to the totals, owing to rounding errors Take-up of fixed and mobile connections, 2006-2007

Figure 1.10 DTV take-up (% homes) Residentia/SME broadband take-up (% homes) DTV: general pattern of growing take-up with digital switchover having commenced in some countries (e.g. UK) and full switchover deadlines approaching in others (e.g. US) Broadband: substantial growth across all the large comparator countries. Year-on-year growth highest in the USA and Germany. Household take-up (%) Source: Ofcom calculations based on IDATE data Note: The broadband take-up figure includes residential and connections to SMEs. The figures will therefore overstate residential take-up and should not be compared to DTV take-up nor to UK residential broadband penetration figures published elsewhere. Take-up of DTV and broadband (includes residential take-up and SMEs), 2006-2007

Figure 1.11 Take-up per 100 population Year-on-year growth (per 100 population) Some evidence that saturating levels of technology penetration are connected with reductions in year-on-year take-up. Source: Ofcom calculations based on IDATE data Note: The broadband take-up figure includes residential and connections to SMEs. The figures will therefore overstate residential take-up and should not be compared to DTV take-up nor to UK residential broadband penetration figures. Technology take-up versus year-on-year increases in adoption

Figure 1.12 -2 -3 0 -3 +1 -1 +8 4 4 4 2 11 4 6 6 4 6 5 11 2 0 3 3 0 -3 0 3 0 Year-on-year changes (note red boxes denote statistically significant movements) Proportion of individuals (%) Source: Ofcom’s Understanding International Communications Behaviour Research, October 2008 Question: “Which of the following devices do you own and personally use? Select all that apply.” Base: All adults aged 18+ using the internet (UK=1001, France=1000, Germany=1002, Italy=1003, USA=1010, Canada=1000, Japan=1003). Note: As the questions were answered online these results may not reflect the attitudes of a representative sample of the whole population. Devices ownership and use among UK internet users, 2006 - 2007 UK FRA GER ITA US CAN JPN UK FRA GER ITA US CAN JPN UK FRA GER ITA US CAN JPN UK FRA GER ITA US CAN JPN

Figure 1.13 Weekly use of a landline Weekly use of a mobile Denotes a statistically significant change Proportion of individuals (%) Source: Ofcom’s Understanding International Communications Behaviour Research, October 2008 Question: “Which of the following devices do you own and personally use? Select all that apply.” Base: All adults aged 18+ using the internet (UK=1001, France=1000, Germany=1002, Italy=1003, USA=1010, Canada=1000, Japan=1003). Note: As the questions were answered online these results may not reflect the attitudes of a representative sample of the whole population. Proportion of male and female internet users using fixed line or mobile on a weekly basis

Figure 1.14 Videos/DVDs Console/computer games Music on a hifi/CD player Music on a portable device Proportion of individuals (%) Source: Ofcom’s Understanding International Communications Behaviour Research, October 2008 Question: “Which of the following devices do you own and personally use? Select all that apply.” Base: All adults aged 18+ using the internet (UK=1001, France=1000, Germany=1002, Italy=1003, USA=1010, Canada=1000, Japan=1003). Note: As the questions were answered online these results may not reflect the attitudes of a representative sample of the whole population. Proportion of men and women using gaming and audio-visual devices on a weekly basis

Figure 1.15 Consumers intentions on mobile telephony spending Source: Execution Primary Research Do you intend to increase / decrease the amount you spend on your mobile phone in the next 12 months?

Figure 1.16 Overall economic vulnerability scores for items of discretionary expenditure Source: Execution Primary Research Note: Consumers were asked to provide a score to assess the lielihood that they would cut back on a particular area of expenditure where 0 = not at all likely to cut back and 10 = extremely likely to cut back

Figure 1.17 Likelihood of cutting back on expenditure Source: Execution Primary Research Note: Consumers were asked to provide a score to assess the lielihood that they would cut back on a particular area of expenditure where 0 = not at all likely to cut back and 10 = extremely likely to cut back

1.4 The regulatory landscape

Figure 1.18 Growth of telecommunications NRAs: 1990-2008 Source ITU-D GSR reports

Source: Ofcom Notes: see next slide Figure 1.19 National regulatory authorities: timeline 2005 2000 1995 1990 KRRiT (POL) 1993 CMT 2 (ESP) 1996 CvDM (NED) 1988 OFCOM 5 (UK) 2003 UKE 6 (POL) 2006 1968 1934 FCC (USA) 1934 ARCEP (FRA) 2005 BNetzA (GER) 2005 COMREG (IRE) 2002 AGCOM (ITA) 1997 OPTA (NED) 1997 PTS (SWE) 1994 RTA (SWE) 1994 CSA (FRA) 1989 CRTC (CAN) 1968 MIC (JAP) 1998 MII 3 (CHN) 1998 BCI 4 (IRE) 1998 Regulator Regulator Regulator - broadcasting regulator - telecoms regulator - converged broadcasting and telecoms regulator 1984 ALM 1 (GER) 1984

Figure 1.19 - notes In Germany, broadcasting is regulated at the state (L änder) level, and coordinated at the national level through the Association of State Media Authorities (ALM); In Spain the Ministry of Industry, Tourism and Commerce regulates broadcasting with three regional authorities in Catalunya, Navarra and Andalucia; In China broadcasting is regulated through a subsidiary organisation called SARFT, which is accountable to and supervised by the MII; In Ireland new legislation is pending adoption (expected before the end of 2008) that will re-name the BCI to the Broadcasting Authority of Ireland, and expand some of its competences; Ofcom inherited the duties that had previously been the responsibility of five regulatory bodies: the Broadcasting Standards Commission, the Independent Television Commission, the Office of Telecommunications (Oftel), the Radio Authority and the Radiocommunications Agency; In Poland the UKE replaced the Office of Telecommunications and Post Regulation, which was established in 2002 Broadcasting is regulated through a subsidiary organisation called SARFT, which is accountable to and supervised by the MII

In Germany, broadcasting is regulated at the state (L änder) level, and coordinated at the national level through the Association of State Media Authorities (ALM);

In Spain the Ministry of Industry, Tourism and Commerce regulates broadcasting with three regional authorities in Catalunya, Navarra and Andalucia;

In China broadcasting is regulated through a subsidiary organisation called SARFT, which is accountable to and supervised by the MII;

In Ireland new legislation is pending adoption (expected before the end of 2008) that will re-name the BCI to the Broadcasting Authority of Ireland, and expand some of its competences;

Ofcom inherited the duties that had previously been the responsibility of five regulatory bodies: the Broadcasting Standards Commission, the Independent Television Commission, the Office of Telecommunications (Oftel), the Radio Authority and the Radiocommunications Agency;

In Poland the UKE replaced the Office of Telecommunications and Post Regulation, which was established in 2002 Broadcasting is regulated through a subsidiary organisation called SARFT, which is accountable to and supervised by the MII

2 Comparative international pricing

Figure 2.1 Household types ‘ Typical’ household type Fixed voice Intern’l voice Mobile voice Mobile messaging Fixed-line broadband Mobile broadband Television 1 A retired low-income couple Low - - - - - Basic 2 A couple of late adopters Medium Low Low - Low - Basic 3 A single mobile-only user - Medium High High - High Pay TV 4 A ‘networked’ family High Medium Medium High Medium - Pay TV 5 Affluent couple with sophisticated use Low High High Medium High - Premium pay TV

Figure 2.2 Basket 5 Basket 4 Basket 2 Source: Ofcom using data supplied by Teligen Note: Lowest tariff available for each service type from any of the three largest operators by market share in each country including multi-play offers July 2007; PPP adjusted. Best prices available, including multi-play offers

Figure 2.3 Basket 5 Basket 4 Basket 2 Source: Ofcom using data supplied by Teligen Note: Lowest tariff available for each service type from any of the three largest operators by market share in each country including multi-play offers July 2007; PPP adjusted. Best prices available for standalone services

Figure 2.4 Comparative single-service ‘weighed average’ fixed-line voice pricing Source: Ofcom using data supplied by Teligen Note: Weighted average of best-value tariff from each of the three largest operators by market share in each country; July 2007; PPP adjusted

Figure 2.5 Comparative single-service ‘best offer’ fixed-line voice pricing Source: Ofcom using data supplied by Teligen Note: Lowest tariff available for the fixed-line voice component of each basket from any of the three largest operators by market share in each country, July 2007; PPP adjusted.

Figure 2.6 Comparative single-service ‘weighted average’ mobile pricing Source: Ofcom using data supplied by Teligen Note: Weighted average of best-value tariff from each of the three largest operators by market share in each country; July 2007; PPP adjusted

Figure 2.7 Comparative single-service ‘best offer’ mobile pricing Source: Ofcom using data supplied by Teligen Note: Lowest tariff available for the mobile phone component of each basket from any of the three largest operators by market share in each country, July 2007; PPP adjusted.

Figure 2.8 Comparative single-service ‘weighted average’ fixed-line broadband pricing Source: Ofcom using data supplied by Teligen Note: Weighted average of best-value tariff from each of the three largest operators by market share in each country; July 2007; PPP adjusted

Figure 2.9 Comparative single service TV pricing Source: Ofcom using data supplied by Teligen Note: Basic pay-TV is defined as the minimum price required to purchase a pay-TV packages which includes channels not available over free-to-air TV; Premium TV is defined as the best package of ftop-league football (NFL in the US and first run films from major Hollywood studios.

Figure 2.10 Composition of Basket 1 Fixed-line voice Mobile Broadband Television Total outbound: 225mins - Local: 61% - Regional: 14% - National: 22% - To mobile: 3% Daytime: 58% Evening: 25% Weekends: 17% No connection No connection Free-to-air digital television --- 1 digital receiver / set-top box

Total outbound: 225mins

- Local: 61% - Regional: 14% - National: 22% - To mobile: 3%

Daytime: 58%

Evening: 25%

Weekends: 17%

Figure 2.11 Basket 1: ‘weighted average’ single-service pricing Source: Ofcom using data supplied by Teligen Note: Weighted Medium of best-value tariff from each of the three largest operators by market share in each country; July 2007; PPP adjusted

Figure 2.12 Basket 1: comparative ‘best offer’ pricing Source: Ofcom using data supplied by Teligen Note: Lowest tariff available for each service type from any of the three largest operators by market share in each country, July 2007; PPP adjusted.

Figure 2.13 Composition of Basket 2 Fixed-line voice Mobile Broadband Television Total outbound: 430mins Local: 65% - Regional: 18% - National: 11% International: 3% - To mobile: 3% Daytime: 58% Evening: 25% Weekends: 17% One basic handset Voice: Total outbound: 60mins To national fixed: 24% To on-net mobile: 38% To off-net mobile: 38% Total inbound: 60mins Daytime: 58% Evening: 25% Weekend: 17% Basic fixed-line connection Minimum speed: 1Mbit/s Minimum usage: 0.5GB Minimum hours: 10 Free-to-air digital television --- 1 digital receiver / set-top box

Total outbound: 430mins

Local: 65% - Regional: 18% - National: 11%

International: 3% - To mobile: 3%

Daytime: 58%

Evening: 25%

Weekends: 17%

Figure 2.14 Basket 2: ‘weighted average’ single-service pricing Source: Ofcom using data supplied by Teligen Note: Weighted Medium of best-value tariff from each of the three largest operators by market share in each country; July 2007; PPP adjusted

Figure 2.15 Basket 2: Comparative ‘best offer’ pricing Source: Ofcom using data supplied by Teligen Note: Lowest tariff available for each service type from any of the three largest operators by market share in each country including multi-play offers July 2007; PPP adjusted.

Figure 2.16 Composition of Basket 3 Fixed-line voice Mobile Broadband Television No connection One high-end handset Voice: Total outbound: 550mins To national fixed: 13% To on-net mobile: 37% To off-net mobile: 37% To international: 6% To voicemail: 7% Total inbound: 550mins Daytime: 60% Evening: 19% Weekend: 21% Messaging and data: SMS: 150 MMS: 10 Internet: 100MB / 300mins Mobile broadband connection Minimum speed: 1Mbit/s Minimum usage: 3GB Minimum hours: 15 Entry-level pay-TV subscription (including channels which are not available via free digital television) --- 1 digital receiver / set-top box

Figure 2.20 Basket 4: ‘weighted average’ single-service pricing Source: Ofcom using data supplied by Teligen Note: Weighted Medium of best-value tariff from each of the three largest operators by market share in each country; July 2007; PPP adjusted

Figure 2.21 Basket 4: Comparative ‘best offer’ tariffs including multi-play tariffs Source: Ofcom using data supplied by Teligen Note: Lowest tariff available for each service type from any of the three largest operators by market share in each country including multi-play offers July 2007; PPP adjusted.

Figure 2.22 Composition of Basket 5 Fixed-line voice Mobile Broadband Television Total outbound: 250mins Local:60% - Regional:7% - National: 13% International: 8% - To mobile: 12% Daytime: 59% Evening: 25% Weekends: 16% One high-end handset One mid-range handset Mobile connection 1 Voice: Total outbound: 400mins To national fixed: 20% To on-net mobile: 29% To off-net mobile: 29% To international: 14% Voicemail: 8% Total inbound: 400mins Messaging and data: SMS: 80 Internet: 30MB / 100mins Mobile connection 2 Voice: Total outbound: 200mins To national fixed: 30% To on-net mobile: 30% To off-net mobile: 30% Voicemail: 10% Total inbound: 200mins Messaging and data: SMS: 20 Fixed-line broadband connection Minimum speed: 8Mbit/s Minimum usage: 5GB Minimum hours: 50 Premium pay-TV subscription, including: - Best package of live top-flight football / NFL - Film package including first-run major studio movies - PVR service --- 1 digital receiver 1 DVR

Total outbound: 250mins

Local:60% - Regional:7% - National: 13%

International: 8% - To mobile: 12%

Daytime: 59%

Evening: 25%

Weekends: 16%

Figure 2.23 Basket 5: ‘weighted average’ single-service pricing Source: Ofcom using data supplied by Teligen Note: Weighted average of best-value tariff from each of the three largest operators by market share in each country; July 2007; PPP adjusted

Figure 2.24 Basket 5: Comparative ‘best-offer’ tariffs including multi-play Source: Ofcom using data supplied by Teligen Note: Lowest tariff available for each service type from any of the three largest operators by market share in each country including multi-play offers July 2007; PPP adjusted.

Figure 2.25 Comparative ‘weighted average’ pricing of single services for all countries Basket 5 Basket 4 Basket 3 Basket 2 Basket 1 Source: Ofcom using data supplied by Teligen Note: Weighted average of best-value tariff from each of the three largest operators by market share in each country; July 2007; PPP adjusted

Figure 2.26 Basket 5 Basket 4 Basket 3 Basket 2 Basket 1 Comparative cost of lowest price services including multi-play for all countries Source: Ofcom using data supplied by Teligen Note: Lowest tariff available for each service type from any of the three largest operators by market share in each country including multi-play offers July 2007; PPP adjusted.

3 Convergence 3.1 Convergence market developments 3.2 Content and aggregation 3.3 Distribution and networks 3.4 Consumption

3.1 Convergence market developments

3.2 Content and aggregation

3.3 Distribution and networks

3.4 Consumption

3.1 Convergence market developments

Figure 3.1 HSPA availability, 2007 Source: IDATE Note: Availability figures for Germany and Japan are estimates

Figure 3.2 Free-to-view streams of TV shows per capita, 2007 Source: Ofcom calculations based on Screen Digest/Comscore data 69% 131% 73% 85% Annual change in streams downloaded (%)

Figure 3.3 Use of the internet to consume audio-visual content Source: Ofcom research, October 2008 3 -4 1 -7 4 0 -4 Percentage point change since 2007 Which of the following do you use your internet connection for?

Figure 3.4 Source: Ofcom Selected broadcast mobile TV offers 2005 2005 2006 2004 2007 2008 2008 2006 2006 2006 Launch 8 channel offering Monthly subscription Verizon Wireless Free-to-air broadcast TV T-DMB Broadcast consortium Subscription and pay-per-view S-DMB SK Telecom/TU Media South Korea Free-to-air broadcast TV Monthly subscription to MoBaHo! Service (scheduled to close in 2009) ISDB-T S-DMB Broadcast/operator consortium MBCO Japan 10 channel offering Monthly subscription MediaFLO AT&T Wireless USA 11 channel offering Monthly subscription DVB-H KPN Netherlands 9 channel offering Monthly subscription DVB-H Vodafone 8 channel offering Monthly subscription DVB-H Telecom Italia Mobile 12 channel offering Mix of free-to-air, subscription and pay-per-view DVB-H 3 Italia Italy Details Technology Operator Country

Figure 3.5 Selected DVB-H developments Source: Ofcom 2007 2008 2009 May - France 13 DVB-H licences awarded by CSA October – Poland DVB-H tender announced July – USA HiWire and T-Mobile Las Vegas DVB-H trial January – USA Modeo DVB-H Trial in New York July – USA Modeo service abandoned October – USA HiWire spectrum Sold to AT&T October – Germany ZAK asks Mobile 3.0 to return DVB-H licence October – Germany Mobile 3.0 awarded nationwide German DVB-H licence Service announcements, trials and launches Service closures

3.2 Content and aggregation

Figure 3.6 Digital music sales as a percentage of total recorded music sales, 2006-2007 Source: International Federation of the Phonographic Industry. -2% -9% £140m £75m £543m -13% -9% 0% -17% -4% -17% -20% -14% £1021m £3028m £1788m £782m £182m £153m £248m Total physical & digital sales 2007 % change in value of total sales since 2006

Figure 3.7 Sales of online films per 100 population, 2007 (VoD/DTO) Source: Ofcom calculations based on Screen Digest data Growth since 2006 0.02 0.15 0.04 0.01 2.48 0.01 0.05 403% 45% 28% 41% 171% 1183% 154% 1.91 2.02 1.58 0.24 0.14 0.05 0.12 Total 0.26 2.17 1.62 0.15 4.39 0.07 0.17

Figure 3.8 Use of the internet for user-generated content Source: Ofcom research, October 2008 Which of the following do you use your internet connection for? +11 +10 +22 +10 +6 +2 +1 0 -7 -8 -4 -5 -9 -4 -1 -6 -1 -3 -1 -1 -1 Percentage point change since 2007 (red boxes denote statistically significant movements)

Figure 3.9 Use of the mobile phone for user-generated content Source: Ofcom research, October 2008 Which of the following do you use your mobile phone for? -7 -2 -2 -7 0 2 0 Time series unavailable Percentage point change since 2007 (red boxes denote statistically significant movements) Time series unavailable

Figure 3.10 Use of the mobile phone to watch video content Source: Ofcom research, October 2008 Which of the following do you use your mobile phone for?

Figure 3.11 Social networking access via a mobile phone, 2007/8 Source: Nielsen Mobile; EU data Q1 2008, US data December 2007 Thousands

Figure 3.12 Digital music revenue per capita, 2007 Source: Ofcom calculations based on International Federation of the Phonographic Industry data. Mobile and online shares based on data for H1 2007. Growth in total digital music revenue since 2006 (%) 23.9% -4.3% £1.34 £0.60 £0.57 £0.22 £2.41 £0.83 £2.24 -1.6% 23.9% 20.5% 62.7% 34.1%

Figure 3.13 Online TV and video revenue per capita, 2005-2007 Source: Ofcom calculations based on Informa Telecoms and Media data 182% 117% 135% 66% 89% 95% 137% £0.98 £0.17 £0.12 £0.08 £1.70 £0.55 £0.22 Year-on-year change (%)

Figure 3.14 Internet advertising spend as a percentage of total adspend Source: World Advertising Trends 2008, WARC Percentage point change since 2006 4.4 1.1 1.1 0.8 2.7 2.4 2.0 1.0 1.8 2.2 3.5 0.5

Figure 3.15 Most popular Google searches by country, 2007 Source: Google Insights for Search (http://www.google.com/insights/search/) youtube youtube bebo ireland IRE facebook youtube download lyrics SWE youtube google marktplaats amsterdam NED youtube juegos hotmail youtube ESP nasza klasa mapa allegro gry POL youtube yahoo video JPN facebook youtube facebook lyrics CAN webkinz youtube myspace lyrics USA badoo youtube libero video ITA studivz youtube wetter ebay GER dailymotion pages jaunes video jeux FRA facebook ebay games bbc UK Biggest riser 3 rd 2 nd 1 st Rank

3.3 Distribution and networks

Source: IDATE Figure 3.16 IPTV availability in selected European countries, 2007

Figure 3.17 IPTV subscribers, 2007 Source: IDATE 6% 93% -- 49% 100% 43% 67% 1233% 43% 41% 610% -- 2900 Year-on-year change (%)

Figure 3.18 VoIP share of fixed telephony revenues: 2005 - 2007 Source: IDATE Note: excludes those who make PC to PC calls

Figure 3.19 Mobile distribution: 2G and 3G availability Source: IDATE Note: *some figures estimated for UK, Germany, Canada and Japan. HSDPA figure unavailable for Canada

Figure 3.20 Fixed-mobile convergence product subscribers Source: IDATE/Ofcom 1,000,000 UK/GER Vodafone 1,250,000 FRA Bouygues 1,400,000 GER T-Mobile Home Zone 125,000 USA T-Mobile 470,000 FRA/UK/POL/ESP Orange Unik 35,000 UK BT Fusion Dual-mode/UMA Subscriber numbers Country FMC offering

3.4 Consumption

Figure 3.21 Take-up of consumer communications devices Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population; figures in green are statistically significantly higher than the average, while those in red are statistically significantly lower than average. Is there a landline phone in your home that can be used to make and receive calls? Which of the following devices do you own and personally use? 14% 20% 16% 72% 77% 89% CAN UK FRA GER ITA USA JPN Fixed telephone line 95% 95% 96% 92% 79% 90% Mobile phone 93% 91% 94% 95% 83% 91% Broadband connection 93% 74% 81% 84% 78% 67% Mobile broadband connection 22% 25% 17% 22% 16% 10% PVR 30% 17% 11% 21% 20% 13% Digital radio set 34% 15% 21% 32% 12% 7%

Figure 3.22 Cross-ownership of household telephony services, December 2005 to January 2006 and November to December 2007 Source: European Commission E-Communications Household Survey Special Eurobarometer reports, number 249 (published July 2006) and 293 (published June 2008) UK NED FRA GER ESP ITA POL SWE IRE

Figure 3.23 What best describes how you make voice telephone calls from home? Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population Main method of making voice calls while in the home

Figure 3.24 Use of mobile phone functions to contact people Which of the following do you use your mobile phone for? Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who own a mobile phone (UK 929, France 914, Germany 946, Italy 952, USA 834, Canada 765, Japan 914 Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population

Figure 3.25 Use of mobile phone to listen to music or FM radio Which of the following do you use your mobile phone for? 2007 %age point change 1 -1 -1 1 6 4 4 -2 0 -1 0 -1 1 0 Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who own a mobile phone (UK 929, France 914, Germany 946, Italy 952, USA 834, Canada 765, Japan 914 Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population

Figure 3.26 Broadband connections per 100 population, 2004 and 2007 Source: IDATE / industry data / Ofcom Average annual percentage point change 5 3 3 4 5 5 3 2 3 5 5 5

Figure 3.27 Internet unique audience by gender Source: Nielsen Online, August 2008 Note: Home and Work use including applications, except Germany (home use only) and Japan (home use only excluding applications)

Figure 3.28 Unique internet audience by age Source: Nielsen Online, August 2008 Note: Home and Work use including applications, except GER (home use only)

Figure 3.29 Time spent online: 2004 and 2008 Source: Nielsen Online, August 2004 and 2008 Note: Home and Work use including applications, except Germany and Spain (home-only data), a new methodology was introduced in 2006 4 year CAGR 21% 13% 13% 18% 6% 9%

Figure 3.30 Frequency of surfing the internet while watching TV Do you ever watch TV at home and go on the internet at the same time? Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population

Figure 3.31 Frequency of using a landline phone while watching TV Do you ever watch TV at home and do these other things at the same time? Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population

Figure 3.32 Top ten website brands by share of unique audience Source: Nielsen Online, August 2008 Note: Home and work use including applications, except Germany (home data only) and Japan (home use excluding applications) UK FRA GER ITA USA JPN ESP 1 Google Google Google Google Google Yahoo ! Google 2 MSN/Windows Live MSN/Windows Live Microsoft MSN/Windows Live Yahoo ! Google MSN/Windows Live 3 BBC Microsoft eBay Microsoft MSN/Windows Live Rakuten Microsoft 4 Yahoo ! Orange AOL Media Network Virgilio Microsoft NTT Comms Yahoo ! 5 Microsoft Free MSN/Windows Live Yahoo ! AOL Media Network GMO internet YouTube 6 eBay Yahoo ! Wikipedia Libero YouTube Microsoft Blogger 7 Facebook TF1 Network Amazon eBay Fox Interactive Media Nifty Terra 8 YouTube PagesJaunes T-Online YouTube eBay FC2 Wikipedia 9 Amazon L Internaute Magazine Web.de Wikipedia Wikipedia Wikimedia Foundation Orange 10 AOL Media Network eBay YouTube eMule Apple Livedoor eMule

Figure 3.33 Selected search websites’ reach and rank among all sites, by reach Rank 1 2 3 1 2 1 2 3 1 2 3 1 3 2 2 1 1 2 3 Source: Nielsen Online, August 2008 Note: Home and work use including applications, except Germany (home data only) and Japan (home use excluding applications)

Figure 3.34 Use of the internet as a source of information Which is your main source for the following interests? Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population

Figure 3.35 Use of the internet to consume audio content For which of the following do you use your home internet connection? Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population; figures are not comparable to those in the 2007 report

Figure 3.36 Use of the internet to consume audio-visual content For which of the following do you use your home internet connection? 2008 %age point change 3 -4 1 -7 4 0 -4 Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population; figures for shorter video clips are not comparable to those in the 2007 report due to questionnaire re-phrasing

Figure 3.37 Use of the internet to contact people Which of the following do you use your internet connection for? 2008 %age point change -1 -3 11 -2 -5 10 1 5 22 -3 -6 10 -2 -5 6 -2 -8 2 -2 -6 1 Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population

Figure 3.38 Impact of the access to the internet on watching television Since starting to use the internet, which if any of the following activities do you believe you undertake more or less often? Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population

Figure 3.39 Impact of the internet on reading national newspapers Since starting to use the internet, which if any of the following activities do you undertake more or less offline? Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population

Figure 3.40 Most missed media activity Which of these activities would you miss doing the most? Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population

Figure 3.41 Use of Voice over IP subscribers per 100 population: 2005-2007 300% 81% 83% 89% 100% 87% 20% n/a 83% 88% 71% n/a 2 year CAGR Source: IDATE Note: Excludes users who only make PC to PC calls. 2 year CAGR unavailable for Poland

4 Television 4.1 Television market developments 4.2 The television industry 4.3 The television viewer

4.1 Television market developments

4.2 The television industry

4.3 The television viewer

4.1 Television market developments

Figure Key television metrics indicator Source: The Japanese licence fee comes in two parts. This higher fee is payable for those homes where broadcast satellite services are taken. £108* n/a n/a £73 £140 £79 £140 Annual licence fee 65% 53% 80% 56% 32% 66% 86% DTV penetration 2011 18% 9% 223 7 ACab 35% £14 £85 £34 £133 £4.4bn CAN 19% 8% 22% 13% 31% 22% Share of largest channel (%) £67 £110 £55 £36 £38 £58 from advertising £48 £111 £35 £37 £52 £71 from subscription £25 £1 £19 £39 £20 £43 from public funding 2012 54% 230 9 ATT 40% £109 £6.3bn ITA 2009 22% 272 5 DCab 33% £221 £66.6bn USA 2011 63% 207 7 DTT 29% £109 £7.0bn FRA 2009 38% 208 13 ACab 50% £113 £9.3bn GER 2012 50% 218 5 DTT 37% £172 £10.4bn UK 2011 DSO date DSat 36% Largest TV platform Proportion of homes (%) 7 ATT channels 262 Viewing per head (mins/day) 53% Share of three largest channels (%) £139 Revs per head £17.7bn JPN Ads, subscriptions and public funds

Figure 4.1 Canada Japan France 2011 2008 2010 Germany Spain USA 2009 2013 2012 Italy UK 2014 Poland 2006 The Netherlands Sweden 2007 Switched over Key: Purple - switched over Pink - transition to switchover has begun Orange - switchover deadline Timeline for DSO Source: Ofcom research

Figure 4.2 Source: IDATE -55% -62% -87% -28% -55% -50% -65% -18% -40% -100% -100% -21% Proportionate reduction in ATT in homes, 2005 - 2007 Proportion of television homes (%) Analogue terrestrial television take-up: 2005 - 2007

Figure 4.3 Source: IDATE Analogue platforms Digital platforms IRL SWE NED ESP POL JPN CAN USA ITA GER FRA UK The changing television platform mix during 2007 Proportion of households (percentage points)

Figure 4.4 DTT take-up since launch Proportion of homes (%) Source: IDATE

Figure 4.5 Proportion of homes (%) Source: World Television Markets 2007, IDATE and Ofcom analysis Note: The data for Germany and the Netherlands should be treated with caution as pay-TV figures include households that pay a small ‘cable relay’ payment in return for access to free-to-view channels Pay-TV take-up: 2002 to 2007 4.8 5.9 0.9 11.4 1.3 2.8 3.9 10.0 0.8 1.1 5.7 3.3 5 yr CAGR (%) 47% 56% 69% 22% 86% 86% 46% 61% 27% 99% 91% 76% Total Pay-TV homes 2007

Figure 4.6 Summary of developments from leading pay-TV operators Source: Industry data/ Ofcom research Last figures reported were 2006 HD subscriber numbers of 200,000 (8.8% of its basic subscribers) However 2007 annual report claims “strong demand for HD and PVR digital set top box equipment. “ Rogers cable CAN Launched Sky+ HD in May 2006 and currently offers 26 HD channels (as at October 2008) 591,000 HD subscribers at end-September 2008 Sky+ DVR subscribers reached 4.1 million at the end-September 2008 Launched VOD service Sky Anytime to Sky+ customers in March 2007 BSkyB UK HD launched in 2006 and there are currently 9 HD channels Launched Canal+ on demand in March 2008 to existing customers CanalSat FRA Comcast claims over 1,000 hours of HD programming at any one time available on broadcast channels and on demand (October 2008) Offers over 10,000 on demand titles each month Currently offers over 100 HD channels (October 2008), with plans for 120 by the end of the year Launched DirecTV on Demand service nationwide in June 2008 to DVR subscribers Comcast DirecTV USA Launched HDTV in December 2005 and currently has two HD channels In June 2005 launched VOD service Premiere Direkt+ In April 2008 signed deal with Warner Bros to show films on VOD simultaneously with DVD release Premiere GER Introduced DVR decoder MySKY in November 2005 Introduced HD in April 2006 with four channels which have increased to six (October 2008) Sky Italia ITA Currently with 15 HD channels (October 2008), “SKY PerfecTV! HD” plans to expand to more than 70 channels in October 2009, and ultimately providing over 100 HD channels to subscribers In October 2006, Sky began offering a DVR service SkyPerfectTV JAP Developments Broadcaster

Last figures reported were 2006 HD subscriber numbers of 200,000 (8.8% of its basic subscribers)

However 2007 annual report claims “strong demand for HD and PVR digital set top box equipment. “

Launched Sky+ HD in May 2006 and currently offers 26 HD channels (as at October 2008)

591,000 HD subscribers at end-September 2008

Sky+ DVR subscribers reached 4.1 million at the end-September 2008

Launched VOD service Sky Anytime to Sky+ customers in March 2007

HD launched in 2006 and there are currently 9 HD channels

Launched Canal+ on demand in March 2008 to existing customers

Comcast claims over 1,000 hours of HD programming at any one time available on broadcast channels and on demand (October 2008)

Offers over 10,000 on demand titles each month

Currently offers over 100 HD channels (October 2008), with plans for 120 by the end of the year

Launched DirecTV on Demand service nationwide in June 2008 to DVR subscribers

Launched HDTV in December 2005 and currently has two HD channels

In June 2005 launched VOD service Premiere Direkt+

In April 2008 signed deal with Warner Bros to show films on VOD simultaneously with DVD release

Introduced DVR decoder MySKY in November 2005

Introduced HD in April 2006 with four channels which have increased to six (October 2008)

Currently with 15 HD channels (October 2008), “SKY PerfecTV! HD” plans to expand to more than 70 channels in October 2009, and ultimately providing over 100 HD channels to subscribers

In October 2006, Sky began offering a DVR service

Figure 4.7 Pay-DVR take-up Volumes of digital video recorders by country (millions) Source: Ofcom calculations based on data supplied by Screen Digest

Figure 4.8 3.8m 2.7m 0.4m 0.3m 20.8m 0.1m 0.1m 0.1m 0.04m Total installed base of DVRs, end 2007 Proportion of DVRs (%) DVR take-up by country and platform Source: Ofcom calculations based on data supplied by Screen Digest

Figure 4.9 FRA 5 years UK 7 years USA 7 years IRL 2 years SWE 4 years NED 2 years ITA 7 years GER 5 years POL 2 years Higher levels of DTV pay TV DVR services launched >5 years Lower levels of DTV pay TV DVR services launched >5 years Higher levels of DTV pay TV DVR services launched <4years Proportion of pay homes taking with a DVR Proportion of homes with pay TV DVR take-up versus digital pay-TV take up Source: Ofcom calculations based on data supplied by Screen Digest

Figure 4.10 Number of HD channels on offer, by platform and country Source: IDATE Notes: * Japanese DTT figure represents an average of HD channel availability across different regions

Figure 4.11 Number of HD subscribers, by platform and country: end 2007 Source: IDATE Notes: This does not include households in the US and Japan that receive HD without a charge over the DTT platform

Figure 4.12 0.7m 0.2m 0.2m 0.1m 6.0m 1.9m 5.8% 1.4% 0.8% 1.4% 6.2% 17.6% Total % of pay subs Proportion of HD homes (%) Number of households paying for HD, by platform and country Source: IDATE Notes: This does not include households in the US and Japan that receive HD without a charge over the DTT platform

Figure 4.13 3.7% 10.1% 2.5% 6.1% 9.9% 3.1% YOY 4 yr CAGR Growth £125bn £138bn £146bn £156bn £166bn Global television sector revenue, 2003 - 2007 Source: Ofcom analysis based on data taken from PricewaterhouseCoopers Global Entertainment and Media Outlook 2007-2011, Ofcom and IDATE for US public funding and subscriber revenue. Note: Data analysis and interpretation is solely Ofcom’s responsibility

Figure 4.14 YOY 5 yr CAGR Growth 6.3% 4.0% -0.8% 4.0% -2.6% -2.3% -0.2% 0.3% -2.2% -0.3% 3.6% 6.7% 13.5% 8.7% -0.1% 3.6% 1.3% 4.2% 1.0% -0.6% 1.2% 2.9% 6.8% 6.1% 2007 value £268 £345 £239 £118 £167 £407 £274 £94 £124 £134 £351 £344 Average subscription revenue per subscriber, by country Average subscriber revenue per subscriber per annum Source: Ofcom calculations based on IDATE data

Figure 4.15 £125bn £138bn £146bn £156bn £166bn Global revenue (£bn) Proportion of global revenue (%) Proportion of industry revenue by source Source: Ofcom analysis based on data taken from PricewaterhouseCoopers Global Entertainment and Media Outlook 2007-2011, Ofcom and IDATE for US public funding and subscriber revenue. Note: Manipulation an interpretation of data is solely Ofcom’s responsibility

4.2 The television industry

Figure 4.16 Source: Ofcom analysis based on data taken from PricewaterhouseCoopers Global Entertainment and Media Outlook 2008-2011, Ofcom and IDATE for US public funding and subscriber revenue. Note: Ofcom has used an exchange rate of $2.00 to the pound. Data analysis and its interpretation is solely Ofcom’s responsibility. Revenue (£bn) Global television sector revenue

Figure 4.17 £125bn £166bn 2.4% 7.8% 4.8% CAGR (4yr) Global television sector revenue: 2003 and 2007 Source: Ofcom analysis based on data taken from PricewaterhouseCoopers Global Entertainment and Media Outlook 2008-2011, Ofcom and IDATE for US public funding and subscriber revenue. Note: Data analysis and its interpretation is solely Ofcom’s responsibility.

Figure 4.18 Source: World Television Markets 2007, IDATE CRTC and Ofcom analysis Note: EUR includes the European countries in this analysis – UK, France, Germany, Italy, Poland, Spain, the Netherlands, Sweden and the Republic of Ireland CAGR (5 yr) YOY Growth (%) Comparative analysis of television industry revenue Revenue (£bn)

Figure 4.19 4.8% 4.3% 1.9% 2.7% 4.4% 4.9% 9.4% 5.7% -1.0% 17.0% 3.6% 7.1% 4.8% 4.6% 6.0% 5.1% 9.5% 6.7% 6.5% 0.5% Source: World Television Markets 2007, IDATE YOY CAGR (5 yr) Growth (%) £37bn £39bn £41bn £42bn £45bn £47bn Total revenues (£bn) Revenue analysis among European countries and Canada

Figure 4.20 Source: World Television Markets 2007, IDATE, CRTC and Ofcom analysis Note: Figures inside the bars represent industry revenue per head. Red boxes highlight figures that are substantially above (or in Japan’s case, below) the average. Population estimates can be found in the country profiles £172 £6.59 £113 £2.94 £109 £4.45 £109 £5.80 £221 £7.55 £135 £5.40 £139 £5.73 £42 £6.13 £91 -£1.00 £106 £6.48 £130 £5.48 £137 £7.16 Revenues per cap Change year on year (£) Revenue per head, by source:2007

Figure 4.21 ESP JPN CAN Net effect £7.16 £5.48 £6.48 -£1.00 £6.13 £7.55 £5.80 £2.94 £4.45 £6.59 £5.73 £5.40 Components of revenue growth, per head: 2006 to 2007 Increase (£) Source: World Television Markets 2007, IDATE, CRTC and Ofcom analysis

Cost per annum (£) No fee No fee No fee No fee Source: Ofcom research Note: The Japanese licence fee costs £63 in terrestrial households or £108 to receive a larger number of channels via satellite. Figure 4.22 Cost of a licence fee: 2007

Figure 4.23 Distribution of advertiser expenditure, 2007 Proportion of expenditure (%) Source: World Advertising Trends 2008, published by World Advertising Research Center

Figure 4.24 Changes in patterns of advertiser spend: 2006 to 2007 Change in spend (percentage points) Source: World Advertising Trends 2008, published by World Advertising Research Center UK FRA GER ITA US CAN JPN POL ESP NED SWE IRL

Figure 4.25 Latest reported revenues from major free-to-view TV operators Annual revenue for latest available period (£bn) Source: IDATE and latest available annual reports Notes: Comparisons between operators should be regarded as indicative only due to the possibility of differences in financial reporting between operators. RTL figures include revenues from broadcasting related activities in countries part of this study (Germany, France, UK and Netherlands). RAI figures include licence fee which combines TV and radio. Percentage change on 2006 figures EUR UK FRA ITA GER ITA FRA JAP UK UK JAP 0.5% 1.9% 3.7% -4.5% 9.1% 4.1% 29% -3.6% 3.4% -1.6% 0.9%

Subscribers as a percentage of Total TV households Source: Ofcom/industry data/IDATE Note: Before 2006 the CanalSat figure takes CanalSat and TPS subscribers combined. CAGR 4 yr 1 yr % Pay-TV market 4.9 4.2 0.8 3.3 -0.9 5.6 2.9 -0.7 -0.8 15.6 9.8 7.2 5.0 5.7 7.2 4.1 1.8 72% 41% 25% 38% 22% 89% 17% 14% 17% Figure 4.26 Subscriber numbers as a percentage of TV households for a range of leading Pay TV operators

Figure 4.27 Source: Latest available annual reports Notes: Every effort has been made to separate subscriber revenue from other sources, but differences in accounting conventions between operators mean that comparisons should be regarded as indicative only e.g. Virgin Media revenue includes telephony. Percentage change has been calculated on figures that may have differed from last year’s report due to restatements Percentage change on 2006 figures Latest reported subscription revenues for a range of pay-TV operators USA USA FRA UK UK ITA GER USA USA GER 17.4% 35.6% 13% 10.1% 11% 24.9% -4.7% 21.9% 3.8% -15.7%

Figure 4.28 Source: Latest available annual reports Notes: Comparisons are for indicative purposes only as definitions of ARPU may differ Latest reported ARPU for some key pay-TV operators USA UK ESP ITA USA GER

Source: Ofcom/EBU Members Note: The UK figures include BBC One, BBC Two, ITV1, Channel 4 and S4C digital Proportion of total hours (%) Figure 4.29 PSB network output, by genre: 2007

Source: EBU Note: The ‘average’ figures represent a weighted average of the data illustrated in the chart. Proportion of total hours (%) Figure 4.30 First run originations, acquisition and repeats

49.6% 50.7% Proportion of output (%) Source: Ofcom/EBU Members Note: The UK figures include BBC One, BBC Two, ITV1, Channel 4 and S4C digital. 49.9% 48.1% 49.7% Average 49.4% Figure 4.31 First-run originations: trends

Proportion of output (%) 21.6% 20.8% 20.2% 20.2% 18.3% Average 14.5% Source: Ofcom/EBU Members Note: The UK figures include BBC One, BBC Two, ITV1, Channel 4 and S4C digital. Figure 4.32 Acquisitions: trends

Proportion of output (%) 28.6% 28.5% 29.7% 31.7% 32.1% Average 36.1% Source: Ofcom/EBU Members Note: The UK figures include BBC One, BBC Two, ITV1, Channel 4 and S4C digital. Figure 4.33 Repeats: trends

4.3 The television viewer

Digital Cable Japan Source: World Television Markets 2008, IDATE and Ofcom estimates Notes: IPTV excluded as not widely available US Digital Satellite Italy Canada Germany France UK Analogue Terrestrial Digital Terrestrial Figure 4.34 Platform availability, by country: 2007

Source: World Television Markets 2007, IDATE Figure 4.35 Reception devices connected to the main set at home, 2007 Proportion of homes (%)

Source: World Television Markets 2008, IDATE Figure 4.36 TV reception devices connected to the main set in the home, 2007 Proportion of homes (%) Terrestrial Terrestrial Terrestrial Terrestrial Terrestrial Terrestrial Cable Satellite Satellite Satellite Satellite Cable Satellite Cable Satellite Satellite Cable Cable Satellite Cable Satellite Cable Satellite Cable 50%

Figure 4.37 Changes in platform take-up, 2006-2007: percentage points Source: World Television Markets 2008, IDATE/Ofcom Note: Red boxes denote the biggest changes in platform take-up Analogue Digital Analogue Digital Analogue Digital 0.2 -2.7 3.1 -0.6 0.7 -5.1 4.3 JPN 0.3 0.6 1.0 -5.6 10.1 -6.3 0.0 POL 1.1 -0.5 0.6 -0.6 1.2 -11.3 9.4 ESP 0.6 -4.6 3.9 0.0 1.3 -4.0 2.8 US 0.9 -4.3 3.7 -0.6 1.2 -2.6 0.8 CAN 0.7 -17.4 14.7 -0.1 1.6 0.0 0.5 NED 0.3 -1.9 1.9 -2.1 2.0 -1.2 1.1 GER 0.6 -1.6 -0.2 -0.5 5.0 -3.4 0.0 IRL 5.6 0.0 0.3 0.0 -1.3 -13.2 8.5 FRA 0.6 0.0 0.2 -0.5 2.9 -8.3 4.9 ITA -5.2 2.1 -0.5 0.9 Cable 6.9 0.0 IPTV -2.2 -0.9 0.0 2.0 Satellite -3.7 3.0 SWE -8.7 6.2 UK Terrestrial Platform

Proportion of homes (%) Source: World Television Markets 2008 IDATE/Ofcom Figure 4.38 Proportion of analogue main sets converted to digital, 2006-2007 Growth in the proportion of main sets connected to a digital decoder (%)

Source: World Television markets 2008, IDATE Figure 4.39 Analogue and digital television households, 2007 Proportion of households (%)

Figure 4.40 Migration to pay-TV: 2005 and 2007 Proportion of homes (%) Source: World Television Markets 2008, IDATE 10.2% 0.6% 4.8% 1.9% 3.9% 4.9% 1.2% 18.0% 3.4% 2.3% 7.4% Migration to pay-TV 2005 to 2007 5.1%

Proportion of households (%) Source: World Television Markets 2008, IDATE Figure 4.41 Pay versus free-to-view television, 2007

Minutes per day Source: One Television Year in the World 2008, Eurodata/Mediametrie, based on national audience measurement systems. 0.9% 1.5% -1.9% -3.8% 0.4% -2.2% 0.4% 2.8% -5.6% 1.9% -0.5% Proportionate change, 2006 to 2007 Figure 4.42 Minutes of viewing per head

Source: One Television year in the World 2008, Eurodata/Mediametrie, based on national audience measurement systems Note: The pink increment represents the additional share added from the second and third most popular channels. The purple increment represents the additional share added by the fourth and fifth channels Share (%) Figure 4.43 Collective audience share of top one, three and five channels, all households: 2007 -5.1% -6.0% -14.2% -2.6% -6.0% -7.8% -11.3% -2.8% -4.1% -3.2% -8.5% Proportionate reduction in top five channel share, 2006 - 2007 -4.6% 60% 63% 78% 55% 74% 31% 24% 79% 67% 54% 70% 60% Share (%) -5.1% -6.0% -14.2% -2.6% -6.0% -7.8% -11.3% -2.8% -4.1% -3.2% -8.5% Proportionate reduction in top five channel share, 2006 - 2007 -4.6% 60% 63% 78% 55% 74% 31% 24% 79% 67% 54% 70% 60%

Share (%) Source: One Television Year in the World 2007, Eurodata/Mediametrie, based on national audience measurement systems Notes: UK figures include BBC One, BBC Two and Channel 4/S4C Average calculated using European channels Figure 4.44 PSB share of viewing, all households -5.6% -4.7% -4.0% -4.1% -5.9% -10.5% -13.0% -7.2% -6.3% -4.6% -13.2% Proportionate change in PSB share of viewing, 2006 - 2007 -4.1%

Share (%) Figure 4.45 Terrestrial channels versus multichannel viewing shares Source: One Television Year in the World 2008 Eurodata/Mediametrie and Ofcom based on national audience measurement systems UK FRA GER ITA US ESP 10.2% 26.8% 5.7% 11.5% 5.9% Proportionate increase in multichannel viewing share, 2006 - 2007 10.0%

Figure 4.46 TV as a source of media interests Which is your main source for the following interests? Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Per cent (%)

Figure 4.47 Concerns about television, all individuals Do you have any concerns about what is on TV? What sorts of things on TV are you concerned about? Per cent (%) Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) All respondents who had any concern about television (UK 388, France 538, Germany 529, Italy 460, USA 477, Canada 429, Japan 248) Base: All respondents Base: All respondents who expressed any concern

Figure 4.48 Concerns about television, 18 to 24 year olds Do you have any concerns about what is on TV? What sorts of things on TV are you concerned about? Base: All respondents aged 18-24 Base: All respondents aged 18-24 who expressed any concern Per cent (%) Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18-24 who use the internet (UK 141, France 190, Germany 193, Italy 191, USA 141, Canada 139, Japan 231) All 18-24 year old respondents who had any concern about television (UK 41, France 94, Germany 106, Italy 107, USA 55, Canada 50, Japan 56)

Figure 4.49 Concerns about television, 45 to 64 year olds Do you have any concerns about what is on TV? What sorts of things on TV are you concerned about? Base: All respondents aged 45-64 Base: All respondents aged 45-64 who expressed any concern Per cent (%) Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 390, France 274, Germany 291, Italy 272, USA 360, Canada 361, Japan 196) All 45-64 year old respondents who had any concern about television (UK 168, France 145, Germany 165, Italy 90, USA 192, Canada 175, Japan 42)

Telecoms 5.1 Telecoms market developments 5.2 The telecoms industry 5.3 The telecoms user

5.1 Telecoms market developments

5.2 The telecoms industry

5.3 The telecoms user

5.1 Telecoms

Figure 5.1 Key indicators, 2007 Sources: IDATE / operators / national regulators Notes: USA and Canada mobile use includes both outbound and inbound calls; 3G includes W-CDMA and CDMA20000 1xEV-DO. It does not include CDMA2000 78 182 223 122 171 138 203 Monthly outbound fixed-line minutes per capita 103 261* 588* 136 69 130 136 Monthly outbound mobile minutes per capita 41.0 66.1 0.9 78% 61.6 58.3 £432 £14.2bn Canada UK France Germany Italy USA Japan Telecoms service revenues £26.9bn £24.4bn £30.4bn £20.5bn £133.0bn £50.4bn Telecoms revenues per capita £443 £382 £369 £353 £442 £395 Fixed lines per 100 population 55.5 45.1 66.0 44.4 53.1 47.4 Mobile connections per 100 population 121.0 86.9 117.9 154.4 85.3 78.9 Share of mobile post-pay connections 36% 66% 45% 10% 92% 98% 3G connections per 100 population 20.6 9.2 10.6 41.4 14.0 65.4 Broadband connections per 100 population 59.9 58.0 49.8 40.7 61.3 57.2 DSL as % of broadband connections 77.9 95.2 94.4 96.8 42.1 46.4

Figure 5.2 Growth of mobile voice volumes and revenues, 2006-2007 Source: IDATE / industry data / Ofcom Note: Outbound call volumes for all countries except the US and Canada, where combined outbound and inbound call volumes are used Mobile call volumes Mobile voice retail service revenues

Figure 5.3 Fixed-line voice retail service revenues Decline of fixed-line voice during 2007 Fixed-line call volumes Source: IDATE / industry data / Ofcom Note: Local and VoIP calls are excluded for the US and Canada

Figure 5.4 Fixed and mobile call volumes per head, 2006 and 2007 Source: IDATE / industry data / Ofcom Note: Local and VoIP calls are excluded for the US and Canada UK FRA GER JPN SWE IRL ITA POL ESP NED

Figure 5.5 Mobile-only households, 2005-2007 Sources: European Commission, Special Eurobarometer, 249 (July 2006), based on fieldwork in December 2005-January 2006; European Commission, Special Eurobarometer, 274 (April 2007), based on fieldwork in November-December 2006; European Commission, Special Barometer 293 (June 2008), based on fieldwork in November-December 2007 Note: Proportion of households in each country which have a mobile connection but no fixed-line voice connection UK FRA GER ITA POL SPA NED SWE IRL

Figure 5.6 Use of mobile phones in the home What best describes how you make voice telephone calls from home? Source: Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003)

Growth in take-up of broadband services, 2003 to 2007 Figure 5.7 Source: IDATE / operators / national regulators

Figure 5.8 Growth in broadband service revenues as a proportion of 2007 revenues 2.6 2.9 3.2 2.3 16.1 2.0 4.5 0.5 1.9 1.3 0.6 0.2 Broadband services revenue, 2007 (£bn) Source: IDATE / operators / national regulators

Figure 5.9 Broadband penetration and growth rates Source: IDATE / operators / national regulators

Figure 5.10 Average monthly retail revenue per broadband connection, 2006 and 2007 Source: IDATE / industry data / Ofcom -7% -1% -6% -2% 2% 1% 4% -8% -9% Annual change -3% -11% -15%

Figure 5.11 Source: IDATE FTTH/B subscribers by region, end 2007

Major NGA developments, 2006 and 2007 Figure 5.12 Source: Ofcom March 2007: Bell announces $1.5bn investment in high speed internet access for residential and business customers, mainly focusing on DSL technologies for residential customers and optical ethernet services for larger business customers. August 2008 : Bell announces that it will deploy FTTB for all new-build MDUs in Quebec-Windsor corridor. Canada January 2008: Three years after beginning its $23bn programme of rolling out FTTH to 19million households, Verizon reports 1.5 million subscribers. June 2008 : A resolution is introduced into the House of Representatives calling for government policy on a new generation network offering universal availability of 100Mbit/s broadband by 2015. USA August 2007: Alt-net Fastweb announced plans that it is to expand its fibre-optic footprint by 1.4 million households. March 2008 : Telecom Italia’s 3-year plan includes a target of offering FTTC to over 2 million households by 2010 (8% of population). Italy Country Major NGA developments UK December 2007: Cable operator Virgin Media announced that it was to upgrade two thirds of its cable network to the Euro DOCSIS 3.0 standard offering speeds of up to 50Mbit/s to 9 million households by 2008/9. June 2008 : Incumbent BT announced plans to roll-out an NGA network to up to 10 million homes by 2012, predominantly based on fibre-to-the cabinet. September 2008: The government-sponsored Caio review emphasised that the private sector should play the principal role in investing in high-speed broadband, and detailed some practical recommendations to reduce cost by facilitating duct and pole access to install fibre cables. September 2008 : Ofcom published a consultation document Delivering super-fast broadband in the UK in emphasising a competition-based approach with the market setting prices for wholesale products. France March 2007: France Telecom launched commercial FTTH services in areas of Paris, with an expanded roll-out in June. April 2007: Neuf Cegetel launched triple-play services including some HD channels over its FTTH service in areas of Paris. September 2007 : Iliad becomes the third operator to offer FTTH services in Paris. August 2008: Law on modernising the economy (LME) introduces a range of measures designed to facilitate hitting a target of 4 million NGA broadband subscribers by 2012 including measures to reduce civil engineering costs by duct sharing, and requiring all new builds to have fibre optic wiring. Germany April 2007: Regulator BnetzA mandates access to the ducts between local exchanges and cabinets in incumbent Deutsche Telekom’s VDSL network, but not to the cables themselves, meaning alt-nets need to install their own fibre if they are to provide VDSL services. March 2008: As part of announced plans to roll out a national VDSL network using Deutsche Telekom’s cabinets, alt-net Arcor released details of a pilot in Thringa to be activated later in the year. July 2008 : Alt-net Hausenet stated plans to roll out its own fibre network, with its first phase a limited FTTB trial in Hamburg. July 2008 : Kabel Deutschland is upgrading sections of its cable network and claims that it has tested download speeds of up to 200Mbit/s during DOCSIS 3.0 trials in Hamburg. Japan November 2007: The government revised its ambitious target of 30 million FTTH/B subscribers by 2010 down to 20 million. January 2008 : Leading FTTH operator NTT lowers rates for third parties to access its FTTH network for the first time since 2001. September 2008 : The Ministry of Internal Affairs and Communications reported that for the first time the number of FTTH connections (13.1 million) exceeded the DSL connections (12.3 million).

Figure 5.13 MVNO share of total mobile subscriptions, 2006 and 2007 Source: IDATE / Ofcom Note: UK and Germany figures include reseller subscriptions in addition to full MVNOs

Number of MVNOs and service providers (estimated) in European countries, November 2008 Figure 5.14 Source: TelecomPaper.com

Selection of multi-country MVNOs / service providers Figure 5.15 Source: Ofcom Ireland, UK Retail Tesco Belgium, Denmark, Netherlands, UK Enterprise/International calls IDT Europe Germany, France (joint venture with Virgin Mobile), UK Retail Carphone Warehouse Denmark, Germany, France, Netherlands, Slovenia Retail Debitel Belgium, Germany, Netherlands, Spain Low-cost Simyo MVNO Type Countries launched Carrefour Retail Belgium, France, Italy, Spain, Debitel Retail Denmark, Germany, France, Netherlands, Slovenia Lycatel Ethnic Belgium, Denmark, Norway, Sweden, Switzerland, UK Lebara Ethnic Denmark, Netherlands, Norway, Spain, Sweden, Switzerland and the UK Virgin MVNO/full service telco Australia, Canada, France, UK, USA

Figure 5.16 Text messages per head, 2006 and 2007 Source: IDATE / operators / national regulators Note: USA data are not comparable as they include SMS and push-to-text 36% 24% 1% 140% 135% 90% -5% 69% 31% Annual change 30%

Figure 5.17 SMS messages per mobile connection and average revenue per SMS, 2007 Source: IDATE / industry data / Ofcom Note: Data are not available for the US or Japan

5.2 The telecoms industry

Figure 5.18 5 year CAGR Total telecoms service retail revenue by sector: 2002 to 2007 Source: IDATE / industry data / Ofcom Note: Excludes revenue from narrowband internet and corporate data services; covers only the 12 countries in the analysis; figures have been restated to reflect more accurate data 36% 8% -5%

Figure 5.19 Source: IDATE / industry data / Ofcom Note: Total service revenue excludes revenue from narrowband internet and corporate data services; the UK figure is not comparable to those published previously as it no longer contains an estimate of retail telephony revenues from non-regulated services Telecoms service retail revenue by sector: 2007

Figure 5.20 Source: IDATE / industry data / Ofcom Note: Total service revenue excludes revenue from narrowband internet and corporate data services Telecoms service retail revenues, 2002 and 2007 GER ITA FRA USA CAN UK JPN 2% 4% 5% 4% 6% 5% 1% 5 year CAGR

Figure 5.21 5 year CAGR Total telecoms service revenue per head, 2002 to 2007 Source: IDATE / industry data / Ofcom Note: Total telecoms service revenue excludes revenue from narrowband internet and corporate data services 5% 4% 5% 1% 3% 4% 2%

Figure 5.22 Fixed-line voice revenues: 2002 and 2007 Source: IDATE / industry data / Ofcom Note: Excludes revenue from narrowband internet and corporate data services -5% -5% -3% -2% -7% -3% -4% -7% -2% -7% -6% -3% 5 year CAGR

Figure 5.23 Fixed-line voice revenue per head: 2002 and 2007 Source: IDATE / industry data / Ofcom Note: Excludes revenue from narrowband internet and corporate data services -5% -5% -3% -2% -8% -4% -4% -7% -3% -8% -6% -4% 5 year CAGR

Figure 5.24 5 year CAGR Monthly fixed-line voice call minutes per head: 2002 to 2007 Source: IDATE / industry data / Ofcom Note: Data for the UK and US excludes VoIP calls -2% -2% 4% -13% -9% -4% -3%

Figure 5.25 Incumbent share of fixed voice call volumes: 2004 and 2007 Source: IDATE / industry data / Ofcom

Figure 5.26 Fixed exchange lines: 2002 and 2007 Source: IDATE / industry data / Ofcom -1% -3% -0% -2% -3% -1% -3% -4% -0% -7% -3% 2% 5 year CAGR

Figure 5.27 Mobile revenues, 2002 and 2007 Source: IDATE / industry data / Ofcom 11% 9% 2% 7% 13% 15% 1% 13% 14% 5% 2% 6% 5 year CAGR

Figure 5.28 Mobile as a proportion of total fixed and mobile revenues, 2002 and 2007 Source: IDATE / industry data / Ofcom

Figure 5.29 Data Mobile revenue, by service type: 2002 and 2007 Source: IDATE / industry data / Ofcom UK GER FRA ITA USA CAN JPN 9% 1% 7% 4% 10% 13% -3% 21% 9% 35% 22% 43% 33% 13% 5 year CAGR Voice

Figure 5.30 Data as a proportion of total mobile service revenue: 2002 and 2007 Source: IDATE / industry data / Ofcom

Figure 5.31 Non-SMS data, as a proportion of total mobile data revenues: 2004 and 2007 Source: IDATE / industry data / Ofcom

Figure 5.32 Mobile voice call volumes: 2002 to 2007 Source: IDATE / industry data / Ofcom Note: USA and Canada also include incoming calls Include incoming mobile calls 14% 5 year CAGR 15% 2% 22% 20% 26% 32% 13% 15% 19% 27%

Figure 5.33 Mobile voice call volumes as a proportion of total voice call volumes: 2002 and 2007 Source: IDATE / industry data / Ofcom Include incoming mobile calls

Figure 5.34 Mobile connections: 2002 to 2007 Source: IDATE / industry data / Ofcom 8% 5 year CAGR 7% 24% 8% 9% 5% 6% 10% 13% 10% 11% 11%

Figure 5.35 Mobile as a proportion of total telecoms connections: 2002 and 2007 Source: IDATE / industry data / Ofcom

Figure 5.36 MVNO share of total mobile connections, 2004 and 2007 Source: IDATE / industry data / Ofcom Note: UK and Germany figures includes reseller’s subscriptions in addition to full MVNOs

Figure 5.37 Herfindahl-Herschman index of mobile subscription concentration: 2004 and 2007 Source: IDATE / industry data / Ofcom Note: Figures for the UK have been updated from those published in the 2007 report, and are now comparable to those of the other comparator countries

Figure 5.38 3G as a proportion of total mobile subscriptions: 2004 and 2007 Source: IDATE / industry data / Ofcom

Figure 5.39 Availability of broadband services, 2004 and 2007 Source: IDATE / industry data / Ofcom

Figure 5.40 Broadband revenues: 2002 and 2007 Source: IDATE / industry data / Ofcom 50% 5 year CAGR 40% 74% 44% 32% 19% 42% 139% 33% 42% 45% 19%

Figure 5.41 Broadband revenue per head: 2002 and 2007 Source: IDATE / industry data / Ofcom 49% 5 year CAGR 40% 74% 42% 31% 19% 42% 137% 32% 42% 45% 18%

Figure 5.42 Broadband as a proportion of total fixed revenues: 2002 and 2007 Source: IDATE / industry data / Ofcom

Figure 5.43 Source: IDATE / industry data / Ofcom Broadband connections: 2002 and 2007 63% 5 year CAGR 56% 77% 43% 39% 31% 29% 166% 32% 42% 55% 19%

Figure 5.44 Source: IDATE Proportion of broadband connections with a headline speed above 2Mbit/s: end 2007

Figure 5.45 DSL as a proportion of all broadband connections: 2002 and 2007 Source: IDATE / industry data / Ofcom

Figure 5.46 Retail subscription share of the top three broadband providers: 2004 and 2007 Source: IDATE / industry data / Ofcom

5.3 The telecoms users

Take-up of fixed and mobile services, 2007 Figure 5.47 Source: IDATE / industry data / Ofcom

Figure 5.48 Take-up of broadband services, 2007 Source: IDATE / industry data / Ofcom Note: For most countries separate data for residential and business broadband connections are not available and household take-up figures will include some business connections (although the corporate data market is excluded).

Figure 5.49 Growth in take-up of broadband services, 2003 to 2007 Source: IDATE / industry data / Ofcom

Figure 5.50 Monthly outbound minutes per fixed-line connection, 2002 and 2007 -1% 1% -10% CAGR -2% 1% -3% -2% -1% -2% Source: IDATE / industry data / Ofcom

Figure 5.51 Source: IDATE / industry data / Ofcom Average monthly voice revenue per fixed line, 2002 and 2007 -4% -2% -3% CAGR -3% 0% -3% -5% -5% -4% -1% -2% -2%

Figure 5.52 Average fixed-line revenue, per minute: 2002 and 2007 Source: IDATE / industry data / Ofcom -2% -3% 2% -6% CAGR -0% -1% -0% -4%

Figure 5.53 Use of VoIP among internet users: 2006 - 2007 Source: IDATE / industry data / Ofcom Note: PC-to-PC calls not included

Figure 5.54 Monthly outbound minutes per mobile subscription Source: IDATE / industry data / Ofcom CAGR Includes incoming and outgoing volumes 6% 5% 13% 14% 12% -4% 4% 5% 7% 5% 17%

Figure 5.55 Mobile as a proportion of all voice call volumes, 2002 and 2007 Source: IDATE / industry data / Ofcom

Mobile subscriptions by type: 2002 and 2007 Figure 5.56 Source: IDATE / industry data / Ofcom UK FRA GER ITA USA JPN CAN

Monthly mobile average revenue per subscription, 2002 to 2007 CAGR 2% 2% -7% -3% 0% 4% -5% Figure 5.57 Source: IDATE / industry data / Ofcom

Mobile take-up and average monthly revenue per subscription: 2007 Figure 5.58 Source: IDATE / industry data / Ofcom UK FRA GER ESP USA CAN JPN ITA IRL NED SWE

Monthly mobile voice and data revenue, per subscription: 2007 Figure 5.59 Source: IDATE / industry data / Ofcom 24% 16% 21% 27% 17% 18% 33% 23% 17% 17% 11% 25% % data

Monthly mobile SMS and non-SMS data ARPU: 2007 Figure 5.60 Source: IDATE / industry data / Ofcom

Mobile data revenue as a proportion of total mobile revenue: 2002 to 2007 Figure 5.61 Source: IDATE / industry data / Ofcom CAGR 9% 23% 7% 14% 27% 15% 11%

Average mobile revenue per outgoing voice call minute, 2002 to 2007 Figure 5.62 Source: IDATE / industry data / Ofcom CAGR -5% -6% -12% -3% -5% -7% -7%

Mobile availability, by technology: 2007 Figure 5.63 Source: IDATE / industry data / Ofcom

Broadband availability by platform: 2007 Figure 5.64 Source: IDATE / industry data / Ofcom

Proportion of home internet connections that are broadband: Q4 2007 Figure 5.65 Source: European Commission E-Communications Household Survey published April 2007 and June 2008, fieldwork conducted Q4 2006 and Q4 2007 by TNS Opinion and Social network Note: Excludes connections classed ‘other’ and responses from consumers who were unsure of their connection type. Figures should be treated with caution due to small sample sizes in some countries.

Average revenue per broadband connection: 2002 and 2007 CAGR Figure 5.66 Source: IDATE / industry data / Ofcom -15% -12% -2% 2% 12% -5% -8% -11% -18% -15% -1% -7%

Public wireless hotspots per 100,000 population, 2006 and 2007 Growth 3% 17% 6% 1% 7% -0.1% 1% 3% Figure 5.67 Source: IDATE / industry data / Ofcom

6 Radio 6.1 Radio market developments 6.2 The radio industry 6.3 The radio listener

6.1 Radio market developments

6.2 The radio industry

6.3 The radio listener

Radio market developments

Figure 6.1 Radio market: Key indicators Key radio market indicators, 2007 Source: Ofcom, IDATE Note: Digital stations also includes trial stations in countries where no full service has yet to be launched. 29 313 2,100 73 107 48 172 Number of digital stations 12% 157 mins 1,252 19% £26 £0.8bn Canada 15% 128 mins 368 58% £13 £1.7bn Japan 55% 177 mins 510 56% £21 £1.3bn UK n/a 24% 49% 26% Public radio listening share 180 mins 202 54% £15 £0.9bn Italy 159 mins 14,124 0.7% £35 £10.6bn USA 79% 57% % public funding 278 886 Number of licensed stations 186 mins 171 mins Listening per head per day £28 £17 Revenues per capita £2.3bn Germany £1.1bn France Total industry revenue

Figure 6.2 Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) Adults regularly listening to the radio Which of the following do you regularly do (at least once a week) – listen to the radio?

% adults listening to the radio & watching TV, at least sometimes Figure 6.3 Do you ever watch TV at and listen to a radio station? Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003)

% adults with a digital radio set Figure 6.4 Devices owned and personally used: a digital radio set Devices owned and personally used: a digital radio set that gives you access to a wider range of stations than a traditional radio set Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) +8 +5 +2 -1 +1 0 +2 2007 percentage point change

Figure 6.5 Use of home internet for radio listening For which of the following do you use your home internet connection for: listening to the radio? Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003)

Figure 6.6 Home internet use for downloading audio content For which of the following do you use your home internet connection for: listening to or downloading audio content, such as music tracks or podcasts? Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003)

Since you started using the internet, which if any of the following activities do you believe you undertake more or less often OFFLINE? Listening to radio (%) % adults with broadband at home Figure 6.7 Change in off-line radio listening since first using internet Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who use the internet (UK 1001, France 1000, Germany 1002, Italy 1003, USA 1010, Canada 1000, Japan 1003) 4% 16% 10% 2% 4% 7% 27% Net % of respondents listening to less radio

Proportion of mobile users (%) Figure 6.8 Mobile audio service use Which of the following activities do you use your mobile for: FM radio, MP3, podcasts? Source: Ofcom Understanding International Communications Behaviour research, October 2008 Base: All adults aged 18+ who own a mobile phone (UK 929, France 914, Germany 946, Italy 952, USA 834, Canada 765, Japan 914 Note: As the questionnaire was answered online it may not reflect the attitudes of a representative sample of the whole population

6.2 The radio industry

Source: Ofcom analysis based on data taken from PricewaterhouseCoopers Global Entertainment and Media Outlook 2008-2012, with additional public radio data from CRTC and CPB Note: Ofcom has used an exchange rate of $2.001 to the pound. Interpretation of data is solely Ofcom’s responsibility. Figure 6.9 Global radio industry revenues, 2003-2007 3.7% 4.8% 4.1% Annual growth (%) 4.2% 1.4% Revenue (£bn)

Figure 6.10 Radio industry revenue, 2007 Source: Ofcom analysis based on data taken from PricewaterhouseCoopers Global Entertainment and Media Outlook 2008-2012, with additional public radio data from CRTC and CPB Note: Ofcom has used an exchange rate of $2.001 to the pound. Interpretation of data is solely Ofcom’s responsibility £10.6bn + £31m - £3m + £36m + £44m - £12m Change on 2006 - £159m + £77m

Figure 6.11 Radio industry revenue growth, 2007 on 2006 Source: Ofcom analysis based on data taken from PricewaterhouseCoopers Global Entertainment and Media Outlook 2008-2012, with additional public radio data from CRTC and CPB Note: Ofcom has used an exchange rate of $2.001 to the pound. Interpretation of data is solely Ofcom’s responsibility 1.7% 1.7% 2.5% 5.2% 1.3% Average four year growth annualised 2.5% 6.0%

Figure 6.12 Proportion of radio industry revenue by source 2007 Source: Ofcom analysis based on data taken from PricewaterhouseCoopers Global Entertainment and Media Outlook 2008-2012, with additional public radio data from CRTC and CPB Note: Ofcom has used an exchange rate of $2.001 to the pound. Interpretation of data is solely Ofcom’s responsibility £58m

Industry revenues per capita (£) Figure 6.13 Radio industry revenues per head 2007 Source: Ofcom analysis based on data taken from PricewaterhouseCoopers Global Entertainment and Media Outlook 2008-2012, with additional public radio data from CRTC and CPB Note: Ofcom has used an exchange rate of $2.001 to the pound. Population figures used in this calculation can be found in the country profiles. Interpretation of data is solely Ofcom’s responsibility. Figures in chart are rounded. £21 £17 £35 £15 £13 £26 £28 Total revenues per head

Public funding share of radio income (%) Figure 6.14 Radio advertising as a proportion of total advertising spend and levels of public funding in 2007 Source: Ofcom analysis based on data taken from PricewaterhouseCoopers Global Entertainment and Media Outlook 2008-2012, with additional public radio data from CRTC and CPB Note: Ofcom has used an exchange rate of $2.001 to the pound. Interpretation of data is solely Ofcom’s responsibility. Radio as a proportion of total advertising expenditure (%)

6.3 The radio listener

Radio stations per million people Number of AM/FM stations by country Source: IDATE, Ofcom 1,250 Figure 6.15 Number of broadcast-based local and national radio stations, per head 510 886 278 202 14,124 368 1,252

Source: IDATE, Ofcom Note: Excludes internet-only stations Number of radio stations available Figure 6.16 Radio stations available over digital radio platforms 48 107 73 2,100 313 29 172 Digital radio stations 2,100

Average weekly hours, per head Source: IDATE, Ofcom Note: Age ranges vary across countries Figure 6.17 Weekly listening hours 2007

Audience share (%) Source: IDATE, Ofcom Figure 6.18 Share of PSB listening, 2007

Emerging markets Brazil Russia India China

Brazil

Russia

India

China

Source: The World Bank, CIA Factbook, US Census Bureau Note: *Gross National Income Key indicators, 2007 Figure 7.1 Telecoms Radio 1,179 292 78 307 125 Total industry revenue (£m) DTT 37% ATT 56% ACab 67% ATT 55% ATT 88% Largest TV platform Proportion of homes 6.3 3.8 3.0 0.5 2.5 from subscription 3.8 0.0 0.01 0.01 0.0 from public funding 5.2 4.3 1.6 3.1 3.9 from advertising £172 £4.2 £2.8 £17.2 £22.6 Revenue per capita 26.9 49.4 10.4 13.4 23.6 Total industry revenue (£bn) £443 £37 £9 £95 £122 Revenue per capita 56 28 4 32 20 Fixed lines per 100 population 121 40 21 123 63 Mobile connections per 100 population 26 5 0.3 4 4 Broadband connections per 100 population Television 15.3 8.1 4.7 3.6 6.4 Total industry revenue (£bn) Country statistics Brazil Russia India China UK Population (m) 194 141 1,129 1,322 61 Median age 28.6 24.8 24.8 33.2 39.9 Surface area (sq km, metres) 8.5 million 17.1 million 3.3 million 9.6 million 243.6k GDP (£bn) 657 645 585 1,639 1,363 GNI*/per capita £2,954 £3,778 £475 £1,179 £21,360 Revenue per capita £0.7 £2.2 £0.1 £0.2 £21

Telecoms

Mobile subscription growth: 2002 to 2007 Figure 7.2 Source: IDATE / Ofcom

Total fixed exchange lines (PSTN and ISDN): 2004 and 2007 Figure 7.3 Source: IDATE / Ofcom

Mobile and fixed-line penetration: 2002 and 2007 Mobile connections per 100 population Fixed connections per 100 population Source: IDATE / Ofcom Figure 7.4

Broadband connections per 100 households, 2007 Figure 7.5 Source: IDATE / Ofcom

Telecoms revenue, by service type: 2004-2007 Figure 7.6 Source: IDATE / Ofcom Note: Revenue excludes corporate data services and dial-up internet BRA RUS IND CHN UK

Average revenue per connection, by service type: 2006 and 2007 Figure 7.7 Source: IDATE / Ofcom Note: Revenue excludes corporate data services and dial-up internet BRA RUS IND CHN UK

Mobile data and voice ARPU: 2006 and 2007 Figure 7.8 Source: IDATE / Ofcom BRA RUS IND CHN UK

TV households: 2002 - 2007 Source: IDATE / industry data / Ofcom Millions of households % of households with main TV set, 2007 44% 95% 96% 98% 99% Figure 7.9

Reception devices connected to the main television set: 2007 Proportion of homes (%) Figure 7.10 Source: IDATE / industry data / Ofcom

Source: IDATE / industry data / Ofcom Proportion of households with FTA versus pay television: 2002 and 2007 Proportion of homes (%) Figure 7.11 BRA RUS IND CHN UK

Proportion of households connected to digital and analogue platforms: 2002 and 2007 Proportion of homes (%) Figure 7.12 Source: IDATE / industry data / Ofcom BRA RUS IND CHN UK

Television industry revenue, 2002 – 2007 Figure 7.13 Source: IDATE / industry data / Ofcom CAGR(%) 2002 - 2007 14% 20% 23% 32% 5% Revenues (£ billion)

Television Industry revenue per head: 2002 and 2007 Figure 7.14 Source: IDATE / industry data / Ofcom BRA RUS IND CHN (£)

Television industry revenue, by source: 2002 and 2007 Figure 7.15 Source: IDATE / industry data / Ofcom Revenues (£ billion) BRA RUS IND CHN UK

Source: Ofcom analysis using data taken from PricewaterhouseCoopers Global Entertainment & Media Outlook 2008-2012 Note: An exchange rate of $2.001 has been used. Interpretation of data is solely Ofcom’s responsibility Figure 7.16 Radio revenues across the BRIC nations 26% Average annualised growth rate 2003 - 2007 (%) 44% 52% 37%

Industry revenues per capita (£/capita) Figure 7.17 Radio industry revenues per head and as a proportion of ad spend Source: Ofcom calculations based on data supplied by PricewaterhouseCoopers Global Entertainment and Media Outlook 2008-2012 Note: An exchange rate of $2.001/£ has been used. The UK has been included for comparative purposes; interpretation of data is solely Ofcom’s responsibility. Radio advertising as a proportion of all advertising spend (%) 6.9% 3.5% 3.9% £21 12.9% 3.6%

Country profiles and appendices A1 Country profiles UK France Germany Italy USA Canada Japan A2 Appendices Exchange rates Research sample size and spread

A1 Country profiles

UK

France

Germany

Italy

USA

Canada

Japan

A2 Appendices

Exchange rates

Research sample size and spread

A1 Country profiles

Telecoms market data UK 60% 50% 39% 24% Broadband (households) 121% 115% 108% 99% Mobile (individuals) 56% 56% 57% 58% Fixed-line (individuals) Penetration (%) 15.6 13.0 9.9 6.1 Broadband connections 73.5 69.8 65.4 59.7 Mobile subscriptions 33.7 33.6 34.1 34.6 Fixed-line Take-up (m) 26,932 25,459 24,567 23,817 Total 2,560 2,194 1,693 1,270 Internet 15,122 13,832 13,049 11,971 Mobile 9,250 9,432 9,825 10,576 Fixed-line Revenues (£m) 2007 2006 2005 2004

Largest telecoms operators, Q4 2007 UK 17% Carphone Warehouse 24% Virgin Media 27% BT Retail Broadband 24% T-Mobile (incl. Virgin Mobile) 24% Vodafone 25% O2 (excl. Tesco Mobile) Mobile

Broadcasting market data UK 48% 52% 12.4 13.4 25.5 1,183 604 580 8,796 3,242 2,302 3,252 2003 37% 43% 9.5 11.0 25.3 1,042 518 524 8,246 3,147 2,216 2,883 2002 86% 77% 68% 58% Digital TV homes 87% 78% 71% 61% Multichannel homes Penetration in TV homes (%) 1,262 1,231 1,253 1,250 Total 22.2 19.8 17.6 14.9 Digital TV homes 22.5 20.1 18.2 15.7 Multichannel homes 25.9 25.8 25.7 25.6 TV homes TV take-up (m) 693 650 614 641 Advertising 570 582 640 610 Public funding Radio revenues (£m) 10,447 10,019 9,872 9,385 Total 3,544 3,469 3,548 3,481 Advertising 2,615 2,521 2,433 2,319 Public funding 4,288 4,029 3,891 3,585 Subscription TV revenues (£m) 2007 2006 2005 2004

Telecoms market data France 58% 48% 37% 26% Broadband (households) 87% 81% 76% 71% Mobile (individuals) 45% 50% 53% 54% Fixed-line (individuals) Penetration (%) 15.6 12.7 9.4 6.8 Broadband connections 55.3 51.5 48.0 44.5 Mobile subscriptions 28.7 31.6 33.1 33.6 Fixed-line Take-up (m) 24,356 23,346 22,747 21,654 Total 2,991 2,325 1,805 1,367 Internet 12,994 12,280 11,775 10,771 Mobile 8,371 8,742 9,166 9,516 Fixed-line Revenues (£m) 2007 2006 2005 2004

Largest telecoms operators, Q4 2007 France 19% Free 21% Neuf cegetel 47% Orange Broadband 17% Bouygues 35% SFR 43% Orange Mobile

Broadcasting market data France 21% 47% 5.0 11.0 23.5 1,003 431 572 5,831 2,058 1,026 2,748 2003 19% 46% 4.3 10.6 23.2 899 379 519 5,608 2,017 1,006 2,585 2002 66% 53% 30% 23% Digital TV homes 84% 73% 53% 48% Multichannel homes Penetration in TV homes (%) 1,073 1,076 1,064 1,034 Total 16.4 13.0 7.4 5.5 Digital TV homes 20.9 17.9 13.0 11.3 Multichannel homes 24.7 24.5 24.3 23.6 TV homes TV take-up (m) 458 468 462 455 Advertising 614 608 602 579 Public funding Radio revenues (£m) 6,971 6,647 6,317 6,209 Total 2,402 2,313 2,214 2,192 Advertising 1,286 1,255 1,230 1,192 Public funding 3,283 3,078 2,873 2,826 Subscription TV revenues (£m) 2007 2006 2005 2004

Telecoms market data Germany 50% 38% 28% 18% Broadband (households) 118% 104% 96% 87% Mobile (individuals) 66% 67% 67% 66% Fixed-line (individuals) Penetration (%) 19.6 14.7 10.7 7.0 Broadband connections 97.2 85.4 79.2 71.3 Mobile subscriptions 54.4 54.8 54.9 54.7 Fixed-line Take-up (m) 30,427 31,036 31,366 31,501 Total 3,218 2,517 2,038 1,698 Internet 15,472 15,956 15,594 15,974 Mobile 11,737 12,563 13,373 13,830 Fixed-line Revenues (£m) 2007 2006 2005 2004

Largest telecoms operators, Q4 2007 Germany 13% Arcor 14% United Internet 46% Deutsche Telekom Broadband 15% E-Plus 35% Vodafone 37% T-Mobile Mobile

Broadcasting market data - Germany Germany 13% 95% 4.7 35.4 37.4 2,097 396 1,701 8,315 2,612 2,800 2,902 2003 11% 93% 4.0 34.8 37.4 1,949 373 1,576 8,427 2,708 2,856 2,863 2002 32% 27% 20% 15% Digital TV homes 100% 98% 97% 96% Multichannel homes Penetration in TV homes (%) 2,308 2,271 2,218 2,135 Total 12.2 10.2 7.6 5.8 Digital TV homes 37.5 37.1 36.7 36.0 Multichannel homes 37.6 37.7 37.6 37.6 TV homes TV take-up (m) 496 465 454 423 Advertising 1,812 1,807 1,764 1,712 Public funding Radio revenues (£m) 9,273 9,033 8,857 8,443 Total 2,961 2,815 2,688 2,640 Advertising 3,251 3,187 3,125 2,818 Public funding 3,061 3,031 3,044 2,985 Subscription TV revenues (£m) 2007 2006 2005 2004

Telecoms market data Italy 41% 36% 30% 21% Broadband (households) 154% 139% 123% 108% Mobile (individuals) 44% 45% 48% 50% Fixed-line (individuals) Penetration (%) 9.9 8.6 7.0 4.7 Broadband connections 89.8 80.5 71.5 62.5 Mobile subscriptions 25.8 26.0 28.0 29.1 Fixed-line Take-up (m) 20,530 20,218 19,882 19,325 Total 2,298 1,977 1,406 1,084 Internet 10,603 10,261 10,257 9,560 Mobile 7,629 7,980 8,219 8,681 Fixed-line Revenues (£m) 2007 2006 2005 2004

Largest telecoms operators, Q4 2007 Italy 11% Fast Web 12% Wind 67% Telecom Italia Broadband 17% Wind 33% Vodafone 41% TIM Mobile

Broadcasting market data Italy 15% 23% 3.3 5.1 22.1 731 294 437 4,558 2,717 1,039 802 2003 14% 22% 3.1 4.8 22.1 634 238 396 4,043 2,218 1,003 822 2002 56% 47% 39% 26% Digital TV homes 60% 52% 45% 32% Multichannel homes Penetration in TV homes (%) 961 840 806 800 Total 12.7 10.7 8.8 5.7 Digital TV homes 13.7 11.8 10.1 7.2 Multichannel homes 22.9 22.8 22.6 22.1 TV homes TV take-up (m) 480 385 356 356 Advertising 480 455 449 444 Public funding Radio revenues (£m) 6,326 5,987 5,633 5,197 Total 3,183 3,145 3,194 3,038 Advertising 1,114 1,092 1,070 1,070 Public funding 2,029 1,750 1,369 1,088 Subscription TV revenues (£m) 2007 2006 2005 2004

Telecoms market data USA 62% 50% 42% 32% Broadband (households) 85% 78% 70% 60% Mobile (individuals) 53% 57% 59% 61% Fixed-line (individuals) Penetration (%) 71.2 56.8 47.1 35.6 Broadband connections 256.8 233.0 207.9 175.5 Mobile subscriptions 160.0 167.5 175.2 177.7 Fixed-line Take-up (m) 132,965 126,323 121,483 116,270 Total 16,058 12,732 10,209 7,807 Internet 69,403 62,700 56,743 51,037 Mobile 47,504 50,891 54,531 57,426 Fixed-line Revenues (£m) 2007 2006 2005 2004

Largest telecoms operators, Q4 2007 USA 11% Verizon 19% Comcast 20% AT&T Broadband 18% Sprint Nextel 25% Verizon Wireless 27% AT&T Wireless Mobile

Broadcasting market data USA 41% 82% 44.5 88.8 108.2 9,656 9,548 46 62 52,550 28,930 246 23,373 2003 37% 82% 39.1 87.1 106.7 9,502 9,446 44 12 50,105 27,737 264 22,104 2002 70% 61% 55% 46% Digital TV homes 95% 91% 88% 84% Multichannel homes Penetration in TV homes (%) 10,600 10,785 10,380 10,029 Total 78.3 68.4 60.2 50.8 Digital TV homes 106.1 101.2 97.1 91.9 Multichannel homes 112.2 111.6 110.2 109.6 TV homes TV take-up (m) 9,346 9,850 9,826 9,791 Advertising 50 50 49 47 Public funding 1,204 886 506 192 Subscription Radio revenues (£m) 66,639 63,788 59,355 56,456 Total 33,063 32,928 30,564 30,155 Advertising 310 283 263 256 Public funding 33,266 30,577 28,528 26,046 Subscription TV revenues (£m) 2007 2006 2005 2004

Telecoms market data Canada 67% 60% 53% 45% Broadband (households) 62% 57% 53% 47% Mobile (individuals) 58% 59% 64% 64% Fixed-line (individuals) Penetration (%) 8.4 7.5 6.4 5.4 Broadband connections 20.3 18.7 17.0 15.0 Mobile subscriptions 19.2 19.2 20.8 20.6 Fixed-line Take-up (m) 14,218 13,397 12,587 11,873 Total 2,018 1,750 1,526 1,315 Internet 6,734 5,907 5,126 4,411 Mobile 5,465 5,740 5,935 6,148 Fixed-line Revenues (£m) 2007 2006 2005 2004

Largest telecoms operators, Q4 2007 Canada 18% Telus 18% Rogers 24% Bell Canada Broadband 28% Telus Mobility 31% Bell Mobility 36% Rogers Wireless Mobile

Broadcasting market data Canada 33% 84% 3.9 10.0 11.9 684 544 140 3,556 1,012 436 2,107 2003 28% 82% 3.3 9.7 11.8 616 476 140 3,319 966 391 1,962 2002 53% 47% 39% 35% Digital TV homes 94% 91% 87% 86% Multichannel homes Penetration in TV homes (%) 844 770 719 707 Total 6.6 5.7 4.8 4.2 Digital TV homes 11.6 11.1 10.7 10.2 Multichannel homes 12.4 12.2 12.2 11.9 TV homes TV take-up (m) 628 600 569 562 Advertising 158 158 150 145 Public funding 58 12 Subscription Radio revenues (£m) 4,435 4,221 3,839 3,669 Total 1,131 1,153 1,109 1,033 Advertising 458 468 436 434 Public funding 2,846 2,600 2,294 2,202 Subscription TV revenues (£m) 2007 2006 2005 2004

Telecoms market data Japan 57% 53% 46% 39% Broadband (households) 79% 75% 71% 67% Mobile (individuals) 47% 50% 53% 55% Fixed-line (individuals) Penetration (%) 28.3 25.8 22.4 18.6 Broadband connections 100.5 94.9 90.2 85.5 Mobile subscriptions 60.4 63.8 67.4 69.6 Fixed-line Take-up (m) 50,393 50,277 49,612 49,492 Total 4,534 3,891 3,221 2,462 Internet 30,616 30,722 30,158 30,347 Mobile 15,243 15,664 16,233 16,683 Fixed-line Revenues (£m) 2007 2006 2005 2004

Largest telecoms operators, Q4 2007 Japan 8% KDDI 18% Softbank 46% NTT Broadband 18% Softbank 29% KDDI 53% NTT DoCoMo Mobile

Broadcasting market data - Japan Japan 25% 70% 12.2 33.3 47.9 1,601 767 834 15,855 8,802 3,033 4,020 2003 17% 64% 7.9 30.3 47.5 1,620 789 831 15,205 8,937 3,007 3,260 2002 65% 57% 52% 38% Digital TV homes 95% 90% 86% 80% Multichannel homes Penetration in TV homes (%) 1,686 1,698 1,690 1,646 Total 31.4 27.3 24.8 18.5 Digital TV homes 45.8 43.3 41.5 38.4 Multichannel homes 48.1 48.1 48.0 48.0 TV homes TV take-up (m) 712 740 754 762 Advertising 974 959 936 884 Public funding Radio revenues (£m) 17,711 16,992 17,288 16,489 Total 8,480 8,664 9,134 8,882 Advertising 3,158 3,058 2,998 3,044 Public funding 6,072 5,271 5,156 4,564 Subscription TV revenues (£m) 2007 2006 2005 2004

A2 Appendices

Exchange rates

Research sample 36 50 14 49 51 1000 Canada 20 57 23 46 54 1003 Japan 27 54 19 49 51 1003 Italy 36 50 14 49 51 1010 US 29 52 19 44 56 1002 Germany 27 54 19 49 51 1000 France 39 47 14 49 51 1001 UK 45-64 25-44 18-24 Female Male Respondents Country Age % Gender % Base