UK citizens are embracing the digital age and modern communications with 2005 experiencing a surge in broadband uptake, voice over IP calls and mobile phones according to Ofcom’s annual Communications Market Report.

According to Ofcom figures, over 10 million UK households now have broadband, and 1.8 million of these homes are using these connections to make voice over IP calls from almost a standing start in 2004.

The number of WiFi hotspots across the UK has almost doubled up from 8,500 to 14,600.

The report also reveals that mobile phone calls accounted for 31 per cent of all calls - up from 28 per cent in 2004.

The digital trend is likely to continue its upward curve as unbundled local loop services, where competing providers take responsibility for the customer’s line to provide telephone, broadband, voice and television over the internet and video on demand services, are now available to 44 per cent of the population, up from 34 per cent in 2005.

Despite increased usage, typical household telecoms costs have fallen by 5 per cent between 2004 and 2005 due to a combination of new technology, intense competition and regulatory intervention.

Ed Richards, Ofcom chief operating officer, said: ‘The sector is being transformed by greater competition, falling prices and the erosion of traditional revenues and audiences.’

‘A new generation of consumers is emerging for whom online is the lead medium and convergence is instinctive,' he said.

Public consumption of media is switching from traditional favourites such as the television and radio to online services, including downloadable content used on iPods and mobile phones – particularly for younger people.

Other industry trends show digital radio is becoming increasingly popular - overall digital listening accounted for 11 per cent of all listening hours in 2005, compared to six per cent in 2004.

Television viewers in Freeview households now spend more time watching digital-only channels than any one of the five main public broadcasting channels.

Advertisers are increasingly targeting web users, as total online advertising revenues have increased almost eight-fold in real terms between 2001 and 2005 - from £0.17bn to £1.3bn per year.

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