Does BT still dominate the UK broadband market?

Wednesday, 1 April, 2020

It’s easy to forget that until 1982, British Telecom had a monopoly on the UK’s telecommunications market.

Yet today, BT finds itself competing against dozens of other landline and internet service providers.

Indeed, the only telecoms monopoly is now held by KCOM, who for historic reasons have exclusive rights to provide landline and broadband services in Hull and East Riding.

Everywhere else, there is competition. And lots of it.

From full-fibre cable providers like Virgin Media and Hyperoptic to conventional home broadband firms such as TalkTalk and Sky, the UK broadband market has fragmented.

Yet BT still retains a higher profile than any of its competitors.

The question is, does it also retain a higher market share of the UK broadband market?

Biggest and the best?

According to recent data from Statista, BT does still hold the largest share of the UK’s ISP market, at 26 per cent.

However, Sky is nipping at its heels with 24 per cent. Virgin Media has around 18 per cent of the market, with TalkTalk on 12.

EE, Plusnet and Vodafone were the only other firms to claim more than one per cent market share.

It’s important to differentiate broadband provision from fixed exchange telephone lines, where BT’s market share is approaching 40 per cent.

As such, BT is still the UK’s largest player in home broadband provision, even if it’s hardly dominant.

However, as a former monopoly holder, BT has one huge advantage over most of its competitors. It owns the infrastructure they have to use…

Open’ all hours

BT’s unique position in the UK broadband market is thanks to Openreach, which was spun off in 2006 as an arms-length infrastructure provider.

Openreach is responsible for all the UK’s telegraph poles and underground cable ducts, which other companies rely on to provide their own services.

Openreach is a legally separate company with independent management, but it’s still owned by BT. And crucially, so are all those poles and ducts.

This pre-1982 legacy gives BT a uniquely close relationship with the company underpinning its broadband services – and those of its competitors.

Unless and until Openreach becomes completely detached from its parent company, it could be argued BT will continue to dominate the UK’s broadband market.

Indeed, if you’ve ever moved into a new house, the builder will warn you that an active phone line can only be provided by an Openreach engineer – or a Virgin Media engineer.

That’s because Virgin uses a proprietary network of subterranean fibre cables, completely unconnected to Openreach’s infrastructure.

Beyond talking

Nowadays, BT is much more than a provider of domestic broadband services or landline connectivity.

Its recent takeover of EE, and the partial rebranding of the latter’s high street stores, reflects BT’s determination to expand its share of the lucrative quad-play market.

This is the term used when a company supplies a household’s landline and mobile phone services, alongside broadband internet and TV content.

Quad-play represents an opportunity for BT to remain a major player, as domestic landlines become irrelevant and growing broadband competition gradually erodes its market share.

The success of BT Sport also shows the company evolving in different directions, such as challenging Sky’s position as the UK’s primary live sports broadcaster.

However, even if BT ceases to be the UK’s biggest provider of home broadband, it’ll remain the first company many people think of when the subject comes up.

Old habits die hard.

Neil Cumins author picture


Neil is our resident tech expert. He's written guides on loads of broadband head-scratchers and is determined to solve all your technology problems!