Broadband in Europe stalls
Price is key to the take-up of broadband, according to the latest research from Gartner.
The analyst firm found that punters are unprepared to fork out the extra cash needed to buy broadband services and will only consider it if the price falls below £20 (E30) a month.
According to Gartner, only one in ten people currently thinks broadband provides value for money. Not only do they want to pay less, they also need a reason for buying it in the first place.
Based on this lukewarm assessment of broadband, analysts forecast that only ten per cent of households in France, Germany and the UK will have broadband access by 2005.
According to analysts the situation is made worse because they argue that there is currently no 'must have' application to convince the majority of consumers they need broadband. And paying for content is simply just not on.
Said Adam Daum, vice president and chief analyst at GartnerG2: "The industry has assumed that broadband would set consumers on fire.
"However, speed alone is not enough: there must also be attractive broadband content...[and] in the absence of good content, our research shows that consumers are very price-sensitive.
"To achieve widespread adoption of broadband, the price needs to fall from its current level of E45-60 per month to less than E30."
To stimulate demand Gartner reckons there needs to be "attractive content", lowers prices and the chance for people to try broadband before they commit to buying it.
Gartner's theory may soon be put to the test. According to reports BT is set to announce on Thursday that it is to slash the cost of its broadband service in the UK. We live in hope.
Still, while Europe gets to grip with its broadband shortcomings, Bill Gates told the World Economic Forum in New York that the high cost of broadband in the US was stifling demand.
Amazingly, there are still some people who belive that the take-up of broadband is not reliant on price. Imagine. ®
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