Consumer uptake of broadband internet services exploded during 2002, clearing the way for a four-fold increase in connections throughout Europe by 2006, according to two new research studies.
The latest
Internet Connectivity report from the
Office Of National Statistics shows that the number of high-speed internet connections grew by a staggering 256% during 2002, to account for almost 11% of all UK internet subscriptions.
This growth was due to a fall in the price of broadband technology and a significant increase in the competition between internet service providers, which have invested millions in promoting their cut-price, high-speed internet products.
New research from Datamonitor predicts that this increasing consumer interest will lead to over 41 million European households accessing the internet via high-speed connections by 2006, up from just over 10 million at the end of last year.
The study forecasts that the UK will overtake France to become Europe’s second largest broadband-enabled country, behind Germany. However, it claims that monthly subscription rates will have to fall to at least £16 before mass market uptake becomes a reality.
Datamonitor also suggests that service providers need to start looking for alternate ways of generating revenues from the broadband sector, with revenue from connectivity due to begin levelling off in 2004, causing premium content services to become the most competitive area in the broadband market.
Adrian Drozd, technology analyst at Datamonitor, said: “Broadband is on the verge of becoming a truly mass market technology – in order to drive uptake further, service providers need to ensure that consumers are aware of the wide variety of content services that can be accessed via high-speed connections.”
He added: “The key challenge for service providers is to provide the content that consumers want, and are ultimately going to be willing to pay for. In order to drive average revenues per user in the broadband sector, the market needs to move beyond simply the provisioning of connectivity – content services must be viewed as a vital component of any offering rather than a non-essential addition.”
