Virgin Media has finally launched its long-anticipated '50Mbps' cable broadband service but analysts have warned the headline speed may not be attainable for very long.
The £51-per-month service, which Virgin claimed will be available to all of its 12 million customers by the end of next summer, was unveiled on Monday. The company aims to have the service available to 40 per cent of its customers – in "areas in Scotland, the Midlands and south London" – by the end of 2008, according to a statement. Virgin Media's previous top speed was 20Mbps.
Virgin Media chief executive Neil Berkett said in the statement: "Today marks a historic moment, for both Virgin Media and the UK. As the first ISP to roll out next-generation broadband access, our 50Mbps service represents the dawning of a new era of high-speed services in the UK, and is just the beginning of what we hope to offer our customers over the coming years."
Virgin Media's 50Mbps service uses a combination of fibre and coaxial cable technologies. The core network is fibre, and fibre often connects the exchange to the street cabinet. However, unlike a true fibre-to-the home (FTTH) setup, the connection between the cabinet and the premises uses coaxial cable, similar to the cable that plugs into the back of a television set. Virgin's speeds are, therefore, much faster than the 24Mbps maximum speed promised by rivals such as Be Broadband and BT, but not as fast as those that would be possible with FTTH.
Broadband analyst Ian Fogg, of Forrester Research, told silicon.com sister site ZDNet UK on Monday that the launch of Virgin Media's 50Mbps service is significant not only because it makes Virgin's the fastest consumer broadband service in the UK, but also because it will spur investment in competing, true fibre networks. He particularly pointed to BT's July announcement that it would roll out fibre to 10 million homes by 2012, at an estimated cost of around £1.5bn.
Fogg said on Monday: "Until someone builds a fibre network, [Virgin's 50Mbps service] will continue to be the fastest network in the UK. This launch is one reason BT made the announcement regarding its fibre investment. Hopefully [Virgin's announcement] will drive Virgin Media's competitors to invest in their networks."
Noting the fact that Virgin Media is essentially the end result of mergers between smaller cable companies that had differing qualities of infrastructure, Fogg said the "real question" is how quickly Virgin can roll out its new, higher speeds across its whole network.
A spokesperson for Virgin Media told ZDNet UK on Monday that the ISP's own tests had suggested 50Mbps customers could expect to receive "at least 45Mbps, 80 per cent of the time". Fogg warned, however, that customers would be unlikely to get that sort of speed for very long.
"There has been a lot of discussion in the press, the Advertising Standards Authority and elsewhere around the impact of the telephone line on the speeds of ADSL broadband [as offered by Virgin's competitors]," said Fogg. "The real issue is that, whichever broadband package consumers choose, including Virgin Media, which doesn't use the phone line, the speed someone gets is also related to how many other people are using the service, and Virgin Media has exactly the same problem there as everyone else."
"It is very hard to say what speed people will get, because that will depend on the success Virgin Media has with getting people to sign up," Fogg said. "The more sign up, the more pressure there will be on the network, and the more likely consumers are to get a lower speed. If someone signs up immediately, they might find the actual speed is [close to 50Mbps], but, in six months' time, they might find less capacity is available." Fogg added that cable services can suffer even greater drops in speed, due to the number of people using the network, than DSL services.
Another issue noted by Fogg concerns the disparity between download and upload speeds. "Networks such as Virgin Media find it much harder to deliver faster upload speeds than other technologies like fibre broadband or even some ADSL packages," he said. "While 50Mbps is the peak download speed, upload speed is much lower. If anything, there is a greater asymmetry than there is with many other broadband packages on the market."
Fogg also suggested that Virgin Media's traffic-management policies may affect the actual speeds that are delivered to customers. "In the past, Virgin Media has had traffic management which has altered speed based on how heavily someone is using the service in just one evening," he said.
"They have also quite frequently altered how they manage the network, so a consumer may sign up and commit to a particular contract period and, over time, the way Virgin Media manage the service will change. It is hard to say precisely how that will operate for the lifetime of the contract. Only Virgin Media really knows what its plans are, in terms of how they will manage capacity on their network and how intrusive they are with network management," said Fogg.
Virgin Media's spokesperson told ZDNet UK that the 50Mbps service would launch "without traffic management", but such management would be introduced "at some point in 2009" when Virgin takes stock of "how customers are actually using the 50Mbps service".