Customers at the Gate: Mounting Demand for Broadband-enabled Services
by Sage Research
Posted: 03/11/2002
Abstract:
There’s no shortage of speculation about if, and when,
broadband Internet access will become ubiquitous. Related to this is wide and
conflicting speculation about what services will ultimately drive the need for
broadband to the home. Most people seem to believe that the potential for
significant markets exists—but up to now, little hard data existed that
identified the size or source of the opportunity.
Based on a random survey of U.S. households, several key facts
now exist that prove a multibillion-dollar annual market potential exists. In
fact, even the most conservative analysis of the survey results points to a $25
billion a year market potential for Internet-delivered services for the home.
This white paper is based on a survey of U.S. households
conducted by Sage Research (Natick, MA) in December 2001. The research,
commissioned by Cisco Systems, Inc., was designed to determine which, if any,
Internet-delivered services consumers would be willing to pay for.
Key results reflect the following themes:
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Average U.S. households are now at a comfort level with
Internet technology such that they are widely open to Internet-delivered
services. Between home, work, and school use, well over half of U.S.
households now have at least one person that has Internet experience.
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The services of greatest interest—such as movies on
demand and continuing education—are also those that will require the
greatest amounts of bandwidth to ensure a quality experience. Should these
services be offered over inadequate bandwidth, consumers will quickly
become dissatisfied. Worse, they will be less likely to consider the
services again in the future because of their previous poor experience.
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Services of high interest also tend to be those that are
relevant to consumers’ current behaviors. For example, cooking
enthusiasts (who likely subscribe to cooking magazines and buy cookbooks)
would pay for access to multimedia cooking resources.
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