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Broadband, Mobile & Energy News: Weekly Roundup 10/08/18


We’ve got another roundup of the week’s energy and broadband stories for you:

Superfast Broadband Provided to 25,000 Extra Scottish Homes

Scotland’s First Minister Nicola Sturgeon announced this week that the latest stage in Digital Scotland - the plans to provide access to superfast broadband across the whole of Scotland by 2021 - has been extended to include an additional 25,000 premises than originally expected.

Digital Scotland, which is led by Highlands and Islands Enterprise, should will now add coverage to seven further exchange areas. These include Torridon and Waternish, Bute and Glendale, in the Highlands; Machrie in North Ayrshire; Great Bernera in the Western Isles; and Kilchenzie and Kilninver in Argyll.

The 25,000 homes and businesses that are now set to benefit from the additional coverage earlier than anticipated are largely based around Tomintoul in Moray.

Ms Sturgeon unveiled the extension to the existing plans while she was visiting Tomintoul itself. She said that "the £146m project has passed its original targets and is providing opportunities for businesses and communities across the region to transform the way they work. We will build on this success and our Reaching 100% programme, backed by £600m, will deliver superfast broadband access to every home and business in Scotland by the end of 2021 - the only part of the UK to do so."

Second British Gas Energy Price Increase in Six Months Announced

British Gas will raise its prices for the second time this year. The most recent increase, following their 5.5% price hike back in April, will put up the price of the company’s standard variable tariff (SVT) by 3.8%. As of the 1st of October, this will take the average yearly cost of a duel fuel SVT to £1205 - £44 more than it was.

The director of Centrica's consumer division, Mark Hodges, said that the company “understand[s] that any price increase adds extra pressure on customers' household bills.” He went on to defend the increase by pointing out that it “reflects the sharp rise in wholesale energy costs.” Since April, the cost of buying wholesale gas has increased by 21%, while electricity wholesale costs have gone up by 18%.

However, despite their second price increase in just six months, British Gas’ parent company Centrica claimed that their average bills were still lower than their competitors because they bought energy in advance and hence were less affected by the rising costs of wholesale energy. British Gas’s competitors in the big six, as well as the rapidly growing smaller supplier, Bulb, have all raised their prices in line with increasing wholesale costs.

Ofgem Increases Safeguard Tariff Affecting 5 Million Vulnerable Customers

Ofgem has allowed the steep increase in the price of buying wholesale energy to be reflected in the cost of its safeguard tariff for the second time this year. The safeguard tariff is designed to protect 5 million vulnerable energy customers from overpaying on their bills. The previous rise in April took the tariff up by an average of £58, and Ofgem has now announced that another increase of £47 will come into force from the 1st of October.

Ofgem’s Chief Executive Dermot Nolan released a statement saying: “around five million households, including some of the most vulnerable, remain better off and are no longer overcharged for their energy, thanks to the safeguard tariff. Any price rise for customers is unfortunate. But while the level of the tariff will rise in October, these customers can be confident that this increase is justified and that their energy bills reflects the real cost of supplying gas and electricity. There are also better deals on the market for those who want to save even more money by switching.”

Currently Ofgem tweaks their safeguard tariff twice per year. They look to rules set out by the Competition and Markets Authority on how to adjust the tariff, which is designed to fairly mirror underlying costs associated with energy supply.

Virgin Media Reports Growth in Last Quarter 

Virgin Media has released its results from the second quarter in 2018, showing steady growth and progress in several major areas for the internet service provider. The company recorded a quarterly revenue of £1.18bn, against a total expenditure of just £100.8m. Both of these figures are improvements upon the results from the same quarter last year.

The strong financial progress has been led by Virgin growing both their subscriber base and their network infrastructure. Virgin reported that their number of broadband subscribers have grown by 61,200 this year, up to a total of 51,166,500.

This is in tandem with their ongoing £3bn network expansion drive, named Project Lightning, which saw another 118,000 premises added to their network in the last quarter. This brings the current total to 1.3 million connected premises, with a target of 4 million by the completion date at the end of 2019.

Virgin is looking similarly healthy on the mobile side of their business as well. Their mobile customer base grew by 80,600 in the last quarter, taking the total to 30,098,600. Virgin also reported that they had almost 9 million further customers using their other services, such as TV and home phones.

Mike Fries, CEO of Virgin Media’s parent company Liberty Global, praised Virgin for providing such a boost to the whole company’s bottom line, having “generated record … revenue and subscriber growth”.

Survey Finds Inflight WiFi Growing in Importance

A recent survey commissioned by Inmarsat (who have been a driving force behind in flight wifi) has highlighted how indispensable retaining internet connectivity is becoming on flights.

Populus surveyed 9,300 airline passengers, representing 32 different countries, on behalf of Inmarsat. The results showed WiFi ranked as the fourth most crucial factor that passengers now consider when choosing their airline. This was despite only 45% of passengers currently travelling on flights on which WiFi is offered.

The survey revealed that two thirds of passengers would consider rebooking their flights to an airline with high-quality on-board WiFi. This rises even higher to 81% of passengers who travel with children, and to 83% of business class travellers. Furthermore, 74% of business class travellers rated in flight WiFi as being “crucial”, with 87% saying that its availability would lead to them being more productive in the air.

Additionally, 53% of travellers would rather have WiFi on their flight than an alcoholic drink, and 54% would prefer no WiFi to slow WiFi.

Philip Balaam, President of Inmarsat Aviation, said that “WiFi is essential to daily life on the ground, and airline passengers see no reason why their time on a flight should be restricted or spent any differently. Whether it’s used for sending that important work email, entertaining the children or even connecting with fellow passengers, staying online is becoming a crucial part of the inflight experience for today’s airline passengers.”

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