IDC Directions 2002: Will customers bite on broadband?

IDC's vice president for Network Infrastructure said the success or failure of broadband networks will depend upon providers' ability to sell customers on the technology.

BOSTON -- The use of broadband networks will hit critical mass in the next two to three years, assuming that providers

can convince users to pay the price for bandwidth and content, according to an analyst for market research firm International Data Corp.

"The content or the application of broadband is the key. The supply side is there, and the technology is there. It's the willingness of people to pay for content that is one of the keys to broadband," said Lee Doyle, IDC vice president for Network Infrastructure, in a speech at IDC's Directions 2002 conference.

Partnerships between content providers and carriers, such as the 2001 agreement between Yahoo! Inc. and SBC Communications, Inc., to provide high-speed access to customized information services, will be crucial to driving broadband acceptance, said Doyle.

Doyle said that while most large companies have adopted some form of broadband, smaller businesses and consumers still must be sold on the concept. Carriers and content providers must convince those buyers on several fronts: that broadband is available at their address; that it is easy to install; support is painless; they will receive value for their money; and they need to be part of the community that broadband offers them. To highlight the expected growth in broadband users, Doyle said that the number of people subscribing to online content will grow from 45 million worldwide this year to 110 million in 2005.

Looking at the corporate market, Doyle drew a timeline in which he expects mass deployment throughout this year, leading to growth in multimedia services and new channels through 2003; greater use of voice over IP, e-commerce and content services from 2003 through 2005; and adoption of application services, outsourced ERP and backup services beginning in 2004.

Doyle emphasized that those watching the broadband market shouldn't focus just on activity in the U.S. He cited the example of Korea, where government policies and geography favor broadband adoption. In that nation, digital subscriber line (DSL) use is expected to almost double from 6 million last year to more than 11 million this year.

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