Death of dial-up in European businesses

24 Sep 2003

IDC has predicted the imminent death of dial-up as a means of internet access by European businesses as firms of all sizes increasingly turn to broadband.

In a new study entitled Western Europe Business Internet Access Forecast and Analysis 2002-2007, the number of business broadband connections in Western Europe, some 2.8 million at the end of 2002, will grow by 34pc CAGR (compound annual growth rate) to over 12 million at the end of 2007.

The decline in the use of dial connections for site access will be most acute amongst medium-sized and large businesses with more than 50 employees.

As well as this the market will subsequently experience a gradual decline in the number of leased line internet connections (-4pc CAGR) as a growing number of businesses replace traditional leased line services with high capacity alternatives.

IDC also predicts that there will be an increasing tendency among larger businesses to have secondary high-speed internet connections.

According to Chris Drake, a senior analyst at IDC’s European IP Services research division, new opportunities are emerging for services providers to extend the range of their offering beyond mere connectivity.

Drake said: “Service providers should look for opportunities to bundle, cross-sell, and up-sell to existing customers, while renewing the emphasis placed on overall customer service.”

For ISPs serving the large enterprise market, the introduction of a range of broadband offerings will be accompanied by new quality of service guarantees, and by a broader range of content services and business applications that can bring value to a standard connection.

Drake continued: “Providers should focus on migrating customers to higher-value connection services, which will include those that incorporate higher bandwidths, as well as connections that are bundled with additional services tailored to support the needs of businesses.”

Meanwhile, ISPs serving small businesses and SOHOs should also seek to take advantage of bundling opportunities, capitalising on the provision of value-added services and business-oriented content. This, Drake concluded, should form part of a wider strategy aimed at enhancing the overall service offering.

By John Kennedy