Opinion: 'Project Fear' turns its gaze to UK telecoms consumers
The term 'Project Fear' has been used to describe the scaremongering tactics of various campaigns in British politics, especially during the 2014 Scottish independence referendum and the 2016 Brexit referendum[^1^]. The aim of Project Fear is to persuade voters to reject a change by exaggerating the risks and uncertainties involved.
Now, it seems that Project Fear has found a new target: the UK telecoms market. Some critics of the current state of the industry have been warning that UK consumers are facing higher prices, lower quality and less choice as a result of the dominance of a few large players, such as BT, Vodafone and Sky[^2^] [^3^]. They claim that these companies are exploiting their market power to stifle competition and innovation, and that the regulators are failing to protect the public interest.
But is this really the case Or is it another example of Project Fear trying to create a false sense of urgency and panic among consumers Let's look at some facts and figures to find out.
First of all, it is true that the UK telecoms market is highly concentrated, with four operators accounting for over 90% of fixed broadband subscribers and over 80% of mobile subscribers[^3^]. However, this does not necessarily mean that consumers are worse off. In fact, according to a recent report by Ofcom, the UK telecoms regulator, the average revenue per user (ARPU) of BT Consumer, the largest provider of fixed broadband and landline services, has been declining steadily since 2014/15, reaching Â36.5 in 2021/22[^2^]. This suggests that BT is not charging excessive prices to its customers, but rather competing on value and quality.
Secondly, it is also true that the UK telecoms market is undergoing some major changes, such as the merger of O2 and Virgin Media, the acquisition of EE by BT, and the launch of new entrants like Starlink and Three. These developments may raise some concerns about potential impacts on competition and consumer welfare. However, they may also bring some benefits, such as increased investment in network infrastructure, improved coverage and speed, and more diverse and innovative services. For instance, O2 and Virgin Media have pledged to invest Â10 billion over the next five years to expand their fibre and 5G networks, while Starlink aims to provide satellite broadband to rural areas that are currently underserved by traditional providers. Moreover, these changes are subject to regulatory scrutiny and approval by Ofcom and the Competition and Markets Authority (CMA), which have the power to impose conditions or remedies to address any potential harms.
Thirdly, it is not true that UK consumers have no choice or voice in the telecoms market. On the contrary, there are many options available for consumers to switch providers or plans if they are unhappy with their current service or price. According to Ofcom's data, 11% of fixed broadband customers and 9% of mobile customers switched providers in 2020, while 29% of fixed broadband customers and 26% of mobile customers changed their package with their existing provider. These figures indicate that there is a high level of consumer engagement and satisfaction in the telecoms market. Furthermore, consumers have access to various channels and platforms to express their views and complaints about telecoms services, such as online reviews, social media, consumer groups and ombudsmen.
In conclusion, while there may be some challenges and risks facing the UK telecoms market in the near future, there is no need to panic or fall for Project Fear's doom-and-gloom scenarios. The UK telecoms market is dynamic and competitive, offering consumers a range of options and benefits. The regulators are also vigilant and proactive in ensuring that the market operates in a fair and efficient manner. Therefore, UK consumers should be confident and optimistic about their telecoms services. ec8f644aee