Broadband peddlars told to cut costs, beef up content

Broadband service providers need to ramp up their content offerings and lower their prices if the future of high-speed internet access is to flourish in Australia, according to research group IDC.

          Broadband service providers need to ramp up their content offerings and lower their prices if the future of high-speed internet access is to flourish in Australia, according to research group IDC.

          Figures from IDC indicate that narrowband usage is by far more popular than broadband, with around three million more subscribers at present. However, the group predicts that by 2004, the gap will have closed significantly, with around four million narrowband users compared to just under three million broadband users.

          Two main factors holding back growth in the broadband arena, however, are cost and content. Using recent Australian Bureau of Statistics figures that highlight the youth demographic as the largest internet home user group, IDC suggests that current pricing of broadband is not compatible with the thin wallets of most young people.

          Compounding the issue is that bandwidth-hungry applications most suited to broadband usage, such as streaming audio and video, online gaming and net radio, are also the ones this same demographic is most likely to seek. Cost is also an issue with businesses, with an IDC survey revealing around 60% of businesses were unwilling to locate their offices in a broadband IP-enabled building due to the cost.

          While cost was one of the key reasons for users not switching to broadband, a more important one was that their satisfaction with their current narrowband setup. With local broadband content being relatively weak, users are not being given any incentive to switch to high-speed access. This led IDC to conclude that content will be the main factor in broadband uptake over the coming years, with service providers needing to develop or syndicate strong content that people are willing to pay for. Additionally, value-adding will play an important role in the popularity of broadband services.

          IDC also predicts the emergence of the "walled garden" concept as epitomised by AOL's offering. This concept will expand and flourish, according to IDC, making content even more of a critical component.

          In terms of what technology users select for their high-speed Internet access, cable modem was the broadband access of choice in 2000. This year, however, has seen a shift with ADSL being the preferred technology. IDC predicts this trend will gain momentum in the coming years, citing a figure of 3.5 million ADSL users by 2005.

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