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Sky marches into fibre broadband pricing war as BT proves most expensive

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Multiplay operator Sky has thrown its hat into the superfast fibre broadband ring, throwing down a 76 Mbps challenge to bitter rival BT, as well as Virgin Media and Vodafone.

Sky’s “Fibre Max” bundle will jolt its fibre speeds from 50 Mbps up to 76 Mbps to compete with BT, against whom it continues to lobby in favour of a separation from Openreach. Sky is the only player of the four to also rely on BT’s Openreach infrastructure, while Virgin Media manages its own fibre network, as does Vodafone following its acquisition of Cable & Wireless and recent expansion into consumer broadband.

Sky seems pretty determined, despite its reliance on Openreach, to keep pace with its competitors in the premium fibre broadband market, as illustrated by comments made by Lyssa McGowan, Director of Communication Products at Sky.

“We’ve introduced Sky Fibre Max to give new and existing customers more choice to access our fastest broadband product at a competitive price,” she said. “The new product represents Sky’s continued commitment to develop our broadband and fibre offering with fantastic customer service.”

It looks as though there’s a war emerging between four of the UK’s biggest broadband providers, with Sky, BT, Virgin and Vodafone all offering vastly contrasting deals to entice customers over from rival ISPs.

Telecoms.com did a bit of digging to find out how the total cost of ownership compares for each of the four major providers, and their various offerings. The good news for Sky and its Fibre Max service is that it prices fairly competitively against Vodafone and BT, although introductory offers from Virgin see it sit ahead of the pack at roughly 10% cheaper than Sky and nearly 25% cheaper than BT.

The bad news for BT is that it is, by some distance, the most expensive of the lot, although it will point to the inclusion of “free” basic TV and its sport channels as a reason for the hike in prices compared to its competitors. Since Sky is leasing its fibre line from BT, one has to wonder how it’s been able to come in at such a considerably cheaper price point.

Operator Cost Per Month Line Rental Total monthly cost Additional charges Contract Length Total Cost Of Ownership Speed
Vodafone £28 £0 £28.00 £49 18 £553.00 76 Mbps
Virgin £18.75 £18 £36.75 £10 12 £451.00 Up to 100 Mbps
Sky Broadband £25 £17.40 £42.40 0 12 £508.80 76 Mbps
BT £30 £19 £49.00 0 12 £588.00 76 Mbps

7 comments

  1. Julie Davis 16/08/2016 @ 1:05 pm

    Not true. Vodafone might have picked up infrastructure with its takeover of C&W but not that it can use to provide broadband connections into homes. It’s a customer of BT Openreach, just like Sky and TalkTalk. That’s why it’s been calling for BT to be split up.

    • Tim Skinner Tim Skinner 16/08/2016 @ 2:04 pm

      Fair point, Julie, thanks for the observation!

  2. Stuart 16/08/2016 @ 1:09 pm

    I live in an FTTP-only development which, whilst great for speed, is not so great for competition. Not only are BT the most expensive ISP but they are one of very few FTTP providers (not all of whom provide service in my area) and one of even fewer that do offer service in my area, to offer a phone line over the fibre. This is a requirement for the monitored alarms that some people in my street have so those wishing to install a monitored alarm system have to go to BT.

  3. Ian Westlake 16/08/2016 @ 1:57 pm

    “Sky is the only player of the four to also rely on BT’s Openreach infrastructure, while Virgin Media manages its own fibre network, as does Vodafone following its acquisition of Cable & Wireless and recent expansion into consumer broadband.”

    I’m pretty sure Voda rely on Openreach too. They might have their own core network, but not rely on Openreach for local access.

  4. Tim Devine 16/08/2016 @ 2:02 pm

    I may be mistaken but I think you have got this calculation a bit skewed because of the additional contract length for Vodafone. That’s the only one where the monthly charges are multiplied by 18 for their longer contract. The others have their monthly charges multiplied by 12 as they are annual contracts.
    While this is clearly a reflection of the TCO, as you have to sign up for longer to Vodafone, its not really a fair comparison for a user as you get 50% more from Vodafone. It would be more representative of the owner’s costs if you reflected a comparable annual TCO from Vodafone while noting you have to sign up for longer. Or have I missed your point?

    • Tim Skinner Tim Skinner 16/08/2016 @ 2:10 pm

      Hey Tim, thanks for the comment. The TCO I ran for the table takes into account Voda’s 18 month tariff, which I agree would be far lower if we took it all on a 12 month like-for-like basis. If we were to do so, Vodafone’s TCO for a 12 month period would be £385, approximately £66 cheaper than Virgin.

      The “Total Monthly Cost” column is intended to show which operator would be cheaper every month, and the overall table is ordered by that column to help illustrate.

      Cheers!

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