Small business won't fall for cheaper broadband

By Nadia Cameron, Australian PC World |  Small Business

The introduction of A$29.95 (US$23) ADSL (Asymmetric Digital Subscriber Line) retail products by Telstra Corp. Ltd. and the massive price war that has ensued will stimulate interest in broadband from the small business sector, but most won't sign up to cheaper barebone plans, an industry representative claims.

Pacific Internet Australia Pty. Ltd. managing director Dennis Muscat said although the new price point would help draw the small business sector's attention to high-speed Internet services, most were too technology savvy to be fooled into signing up for services with entry-level download excess charges.

Cheaper ADSL services would stimulate interest and fuel small businesses to take up broadband, but not at the A$29.95 price point, Muscat said. This is despite the fact that 41 percent of small businesses in Australia are now using broadband plans aimed at the residential market.

According to the results of Pacific Internet's latest Broadband Barometer January 2004 report only 47 percent of small businesses surveyed use a broadband product tailored specifically to the business and small business market.

Muscat said there was a plethora of broadband products designed for businesses in the market today. However, the industry was still not doing enough to sell the benefits of business-grade services to the small business sector.

The quarterly broadband report, compiled for Pacific Internet by ACNielsen.consult, is based on a survey of 452 Internet-enabled small businesses (with up to 50 employees) across both metro and regional areas in Australia.

Of those surveyed, 47 percent are now accessing the Internet via a broadband service.

DSL services proved most popular, with 30 percent of respondents using some form of DSL as their broadband connection.

For the first time since the report began in June last year, respondents were asked to compare the impact of broadband with narrowband on their business.

In total, 61 percent of respondents said broadband had "significantly" improved efficiency and productivity of their business, while another 25 percent said broadband was "extremely significant".

But the benefits were being lost to regional businesses unable to access broadband services, Muscat said.

Of those businesses surveyed in metro areas, 55 percent were using broadband, compared to 20 percent in regional areas. While 34 percent of regional businesses said they didn't use broadband because it was too expensive, 37 percent said they could not access broadband in their area.

The report also found take-up of "value-added" high-speed services, such as Voice over IP (VoIP), videoconferencing and Wi-Fi, remained low across the small business sector.

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