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Telecoms
Broadband competition – phenomenally good for business
Gibraltar’s three broadband suppliers, each with a separate infrastructure, is “phenomenally good” for business and consumers with lower prices, faster speeds and wider services
Gibraltar has The dominant supplier, State-owned
Gibtelecom (Gibtel), saw its market
share of broadband slip to 70% in networks to 2016 from 90% previously, largely as
Sapphire Networks, the second largest supplier, diversified from corporate and enterprise business into residential connections through its u-mee subsidiary.
Relative newcomer, GibFibreSpeed has been strongly marketing broadband services, while investing £10m in fibre cabling to service Gibraltar homes and businesses. “I believe it is because of our intervention in the market that prices generally have come down in Gibraltar – we have had a major impact on reducing the cost and raising the speed offering for internet,” Julian Sheriff, GibFibreSpeed’s development manager, said.
The Gibraltar Regulatory Authority (GRA) reported the number of broadband residential and business subscribers in Gibraltar at the end of 2016 increased by 1,641 to 16,357 and was “due, in part, to the new residential housing estates being constructed around Gibraltar”.
The GRA’s annual report published in September declared “new broadband packages from u-mee and GibFibreSpeed have attracted substantial [residential]
subscriber numbers and now have market shares respectively of 17% and 11%” at end-March 2017.
“With Gibtelecom upgrading customers to higher broadband speeds at lower prices as well as the wider availability of products from broadband providers ... subscribers are now enjoying fibre to the home (FTTH) broadband with speeds of up to 300Mbps, as well as customisable packages in excess of 300Mbps,” the GRA said.
Despite high-speed offerings, 25Mbps was the median purchased in 2016-17, compared with around 7Mbps a year earlier. “It is widely accepted that consumers generally want faster broadband,” declared the GRA, which expected the shift to higher bandwidth products to grow.
TV fuels competition
Much of the demand has been fuelled by the two smaller companies packaging broadband and ‘phone provision with live TV, something that Gibtel has resolutely refused to provide without the latter being licensed. Now, by end-March, Gibtel expects to launch its IPTV service, which chief executive, Tim Bristow says will be “different to the others, a technically superior product with a range of media services that aren’t currently available from our competitors and, crucially, licensed content, for which we are going to pay.”
“The dynamics have changed in the last two years; [our competitors] are being particularly aggressive in the market and therefore we had little choice but to move into that space,” Bristow said, adding: “With this development, we are going to win more of this market back”.
He noted: “It’s very expensive to do it properly and legally. We are investing several million pounds over 3-5 years – a large proportion of that is to legally buy the content, which we have to do every year.”
Bristow admitted: “With many of the new homes, we haven’t done as well and we have started to lose some accounts in other places, but that is to be expected in a competitive market.” Loss of broadband sub- scribers – “not as much as people might think” – had contributed to Gibtel’s turnover flat lining year-on-year at around £42m, with 30% coming from fixed line – both
broadband and telephone – and a similar proportion each from mobile and from international business outside of Gibraltar.
u-mee packages combine high definition TV, a proper landline with a local ‘phone number and FTTH broadband; they also offer a ‘Talk-app’ that allows local calls to be received on a mobile phone on any network wherever in the world customers receive 3G, 4G or WiFi connection - a popular added feature included with the higher ‘u-mee Plus’ bundle.
‘TV & Go’ (that allows live TV programmes on a smartphone or tablet, or use with a set top box connected to the internet, with 7-day catch-up and programme recording), is available for u-mee and non-customers.
For more than 15 years, Gibsat Ltd has been The Rock’s main TV provider using analogue cabling. Sheriff maintained: “Although residential customers have been the foundation of our business, it is the corporate side, where prices remain high compared with the UK and Europe, that represents our biggest opportunity.”
Receptive market
Convincing large eGaming businesses and others in the corporate sector that GibFibre’s product is a viable alternative is a major challenge. “We are a lower cost alternative with a similar offering to that of the two bigger players, so it will be down to how well we perform”, admitted Sean O’Reilly, who joined last year from Dublin where he was country manager for Huawai, the Chinese telecoms and IT giant that he helped establish there 15 years ago.
O’Reilly added: “There is always going to be a degree of drag – traction time – that requires a leap of faith for any new business customers that depend on the internet for their survival, but the market has been very receptive to our arrival and we feel that will be converted into customers.” GibFibre says it already has some - undisclosed - large customers, including at least three gaming firms, and others in financial services; “there are also a significant number of smaller businesses moving to us.”
Continued overleaf
three separate broadband
service business and residents
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Gibraltar International
www.gibraltarinternational.com