Rory Cellan-Jones

Broadband: Who wants to be number one?

  • Rory Cellan-Jones
  • 8 May 09, 16:37 GMT

In Britain's broadband league, there's a new number one - or is there?

carphone warehouseCarphone Warehouse claims that its takeover of Tiscali gives it more residential customers than any other internet service provider, with BT now in second place and Virgin Media third.

So, having only got into the business three years ago with its TalkTalk service, the purchase of first AOL, and then of Tiscali has made it the biggest noise in UK broadband.

BT disputes that claim - it says it has 4.7 million broadband customers to Carphone Warehouse's 4.3 million. But Carphone says some of those customers (BT won't say how many) are businesses, so it's confident it's the leader in the residential market.

If I were BT, I wouldn't be fighting for that number one spot, nor would I be as keen as Charles Dunstone of Carphone is to claim it. Why?

Because being number one means, as BT has found to its cost, that the spotlight is shining right at you when it comes to all those tricky questions about the future of "Broadband Britain".

First, there's the issue of customer service. If you're the biggest player, you're also likely to have the most complaints - and you need to show how well you can deal with them.

TalkTalk certainly had its issues with customer service in the early days - it claims those are largely resolved - but now it's taking on 1.7 million users who may put an awful lot of strain on its call centres.

Tiscali's dealings with its customers - and I should declare an interest as one who left in despair and even then struggled to escape their clutches - makes TalkTalk's service seem like a combination of Rolls Royce and the Orient Express.

Second, the regulator, the government, and the creative industries will now be looking more closely at Carphone as the biggest representative of the broadband industry which is at the centre of the upcoming Digital Britain report.

The Universal Service Obligation - bringing 2mbps broadband to every corner of the country - was seen as mainly an issue for BT. Now Carphone may have to help find a solution.

Charles DunstoneThen there's the pressure on ISPs from the creative industries to do more in the battle against illegal file-sharing. Until now, Charles Dunstone has been extremely combative on this issue declaring that he wasn't going to be the internet's policeman, whatever music companies or ministers might say. And judging by my interview with him today - you can listen below - he's not about to change his tune.

And finally there's the Phorm question. Carphone is one of three ISPs to have held talks with the controversial behavioural advertising firm - but it's BT which has copped most of the flak. Charles Dunstone was still stressing today that Carphone hadn't even tested Phorm yet. But the broadband supply business runs on pretty thin profit margins, so Mr Dunstone is going to have to look at every possible means to find new revenue streams, and behavioural advertising is one obvious answer.

So congratulations to Carphone Warehouse - even if your position at the top of the table is disputed. But be aware that every broadband user, politician, regulator, privacy campaigner and music business will now be on your case. Enjoy!

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  • Comment number 1.

    If CPW wants to be bigger than BT Retail in broadband, then dropping Phorm, and promising never to go near it again, would be a pretty smart move.

    Users will be leaving BT in droves if BT implements Phorm, and they won't want to jump out of the frying pan into the fire.

    But if CPW can offer them a safe haven, then watch those subs roll in.

    NB: I've just come off the Orient Express. *Any* broadband provider has some way to go to meet *those* standards of service :-)

  • Comment number 2.

    Well done Charles. However it really is about time you changed the name of your company, which is becoming increasingly inappropriate. How about 'Great Big Communications Business'?

    Any better ideas?

    Mike Berry

  • Comment number 3.

    you write "The Universal Service Obligation - bringing 2mbps broadband to every corner of the country.."

    without an apparent trace of irony...

  • Comment number 4.

    As far as I am aware, broadband is not part of Universal Service Obligations in the EU, or am I missing something?

  • Comment number 5.

    Carphone warehouse = Appalling service and support,slowdowns and throttling, and considering whether to spy on us with Phorm.
    BT = Will soon be spying on every webpage you visit and every email you send.
    Virgin = also considering whether to spy on us.

    What a great "top 3" NOT.

    There are some really good ISPs out there that provide quality broadband without throttling, blocking and spying, I would advise everyone research a little because you wont be disappointed compared to the "top 3"

  • Comment number 6.

    Quite frankly I as a consumer couldn't give two hoots about who is "number 1" in the broadband market... long as

    1. There is not a monopoly.
    2. I have a choice to switch ISPs at a moments notice if I am getting a bad service.
    3. I can get a decent service for very little in the same way internet users in other countries can.

    Sadly points 2 and 3 aren't relevant to the UK market because we're held to ransom on our internet connections which are slow in the grand scheme of things and overpriced, no matter who we use as an ISP.

    So who is number 1 in the market is irrelevant to the consumer.

  • Comment number 7.

    This whole number 1 business is all well and good but buying your way to the top is the easist way. If we jump forward 3 years Carphone would just as easily lose more than half those through poor customer service. Their latest tacked of getting pushy asian guys to jump you in the street while you try and shop is prime example their misconception of the way customers wish to interact with business.

    As for BT. well the good old days are truely gone and the cracks are starting to show - and as the loyal nation dies away, the generation of people who care what the service is like are now taking control. BT, with is money saving call centres fails time and time again - while banks started to move call centres back to the uk, BT thought "ooooh... wouldn't it be good if we could over charge for our product and pay international call centre staff less than what we pay uk based staff - so what if the service suffers"
    People have now got to the point where they are willing to take any option to not deal with BT - which again is a shame, due to the lack of businesses able to provide the service they do but with a better customer service.

    Having just gone through the great challenge of finding a broadband provider to trust and rely on - neither carphone or bt show up in the top 3 of independant comparison sites - in fact I would say the top 5.

    Choosing a provider is not about number of customers. Its about speed/price/customer service - these 3 things are the only true relavents.
    I choose to go with O2 Broadband in the end - because they seemed to be the most consistant and didn't try a pull the wool over my eyes with those stupid £4.99 for 3 months and then the massive jump to £15+. I always read the customer reviews before bying any service - yep O2 come top - thats not to say that they didn't have any unhappy customers but hey... guess you cant win them all. on the scale of things O2 showed up the apparent top 3 (according to BBC)

    with the move to TV over the internet in the next few years those who still offer 2meg speeds will be left behind to rott.
    Companys who are currently in place to offer the bigger better experience:
    O2 - 20 meg
    be* - 24 meg - linked to O2 - not sure why the diff in speed
    Virgin - 50 meg


    BT & CARPHONE - jog on - hahahaha

  • Comment number 8.

    I'd just like to say that with behavioural advertising and other such methods, the desire to use Secure Connections - IMAP over SSL, SSH and HTTPS, SFTP etc becomes stronger every day.

    Long live encryption - and the right to private communications without a spying ISP!

  • Comment number 9.

    Things will only improve when BT are taken out of the equation at the moment the smaller ISPs hire the connection from BT so when you use a smaller ISP in reality you use BT.
    I suggest they act as a network rail of the broadband, creating bigger better connections for all.

  • Comment number 10.

    I have just moved to O2 what a good customer orientated company, twice the speed of Orange using their Be network, slick UK contact using SMS and emails, deliver on time, even my BT ex colleague who worked for BT Broadband recommended them. Half the price of Orange.
    in South Yorkshire we are about to have a revolution in broadband with Digital Region giving 25Mb/s to all businesses and residents of Sheffield,Barnsley,Rotherham and Doncaster and their villages with a one hundred million pound plus EU financed network which is being initiated now, cant wait. see

  • Comment number 11.

    #6, Your point number 2 is a big one to me. We had one nightmare. Service had dropped to a level where the Internet was unusable in the evenings and having tried support, I think we were left with no alternative but to change provider.

    We couldn't get the MAC code so we wound up back to square one and BT line checks as ASDL was removed from the line and then restored. We found costs to the free domain name, etc. I suppose we wouldn't have minded so much if we were trying to just get the cheapest deal but the reason for moving was the service had become appauling. With this co, it was easy to get in to but not easy to get out of.

  • Comment number 12.

    BT are the biggest broadband provider by far, followed by Virgin Media (Cable) and then Be / O2 (ADSL2), all the other internet providers like Carphone Warehouse are only reselling the services offered by BT. The same happens with the landline packages from various providers like TalkTalk, all these companies do is resell data access and talk minutes that they have bought from BT.

    This article is comparing one reseller against two provider's, it makes no sense. Just because Carphone Warehouse are taking over Tiscali doesnt mean they will become number one, all these users are still using BT's services and products and not Carphone Warehouses!? To really decide the number one broadband provider you shouldn't be comparing the userbase, instead it should be based on internet speed, connection ratio, reliability and customer support.

    BT is currently the monopoly, many people seem to believe they are not but they are. BT maintain the backbone data network within the UK, they maintain most of the land lines within the UK. This is why the UK is far behind on internet speeds than other countries, BT refuses to implement fibre optics on a home by home basis due to cost and they are constantly delaying moving local exchanges to the W1CN technology.

    BT will never be removed the equation, they are the only company networking the whole of the UK. Companies like Virgin Media are only working on small areas and the cost of being able to expand over the whole country is too expensive to be worth considering. To get things moving, BT needs to be forced by the government to step things up, even South Korea has a better infrastructure than the UK so were definitely doing something wrong. South Korea has recently started experimenting 1gb/ps connections, something the UK wont be able to achieve for many many years.

    Even the plan of giving every home, access to 2mb/ps internet connection wont improve much. The government really needs to force higher speeds onto BT for us to actually gain an improvement on the network. BT needs to improve the UK's infrastructure by implementing fibre optics, to offer 2mb/ps internet connection they can continue using the current copper wiring and just improve the exchanges.

    Sadly the UK is behind the times, and will continue to be for the foreseeable future.

  • Comment number 13.

    TalkTalk took over OneTel in 2006. To this day they still run a separate call centre and separate billing process! Prices are the same, but if you make the mistake of phoning the TalkTalk call centre and not the (OneTel) TalkTalk call centre, you'll find the person you're talking to will have no idea you're a customer!

    It's quite possible they'll do the same with Tiscali.

  • Comment number 14.

    It will be interesting how CW, having benefitted from the dogma of competition policy with pricing incentives for LLU operators, can be number one but avoid all the resonsibility of running and maintaining a critical resource. It's network division is Opal Networks.

    I reckon it will be sold off before anyone can mention a Universal Service Obligation, next generation access, assured Bradband services, commitment to rural network enhancements.

    UK Regulation for the last 20 years has been a process of creating competition to force prices down, done largely by reducing BT from a status of national champion to a basic utility company. Regulation and policy for the next 20 years needs to be about investment in next generation access and convergence of fixed, mobile communication services and internet communication services.

    It will be interesting to see how the Digital Britain report pulls this one off.

  • Comment number 15.


    Carphone Warehouse do not resell BT Wholesale ADSL service, they have unbundled over 1700 exchanges with their own MSAN's, its true there are some legacy customers on IP Stream but all will be unbundled as soon as exchanges are enabled unless the end user chooses to decline.

  • Comment number 16.

    I've just left AOL/Carphone WH for another ISP due to very poor service.
    They have deployed a traffic shaping policy that blocked my access to the EA gaming authentication servers between the hours of 4pm - midnight.

    My attempts at trying to resolve this issue fell on deaf ears and the number of "cut and paste responses" that I got from their support team was very frustrating. AOL denies that the policy is even in place and put the blame on EA, saying that their servers couldn't handle the peak time traffic that they get. Some of the responses that I got did not even relate to my complaint - one of the responses was related to P2P sharing software and if I had it installed, a warning to remove it??

    I traced the issue back to a server IP that is based in Manchester and registered to a company called Opal Telecom, who just happen to be a wholly owned subsidiery of Carphone WH.

    I have now moved to a new provider and my problem is now gone completely no issues logging onto EA servers at any time.

    All I got from AOL support was lies and smoke.


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