Business Broadband Uptake Inhibitions

Thanks to strong growth in the number of remote workers, enterprise customers are showing increased demand for broadband, namely DSL, though demand is tempered in this lagging economy.

by ISP-Planet Staff [September 13, 2002]

According to recent research from In-Stat/MDR, business broadband usage is likely to grow in the coming years, but digital subscriber line (DSL) access may remain relegated to non-essential applications in small remote branch offices or for at-home workers.

The Scottsdale, Ariz.-based research firm contends that the scale of enterprise applications for main and larger branch offices could be the key barrier to uptake of DSL connections.

Kneko Burney, Director of Business Infrastructure and Services research for In-Stat/MDR, said larger offices demand robust connections to the public network that typical broadband connections cannot supply. But DSL access often fit the bill for remote or brand offices and telecommuters.

"The concept of a 'distributed enterprise' is not a catch phrase, but a reality for most firms with more than 1,000 employees," Burney said. "As a result, enterprise bandwidth continues to be driven primarily by the exchange of internal content, either among employees or to customers."

Burney noted that the manner in which this content is exchanged has begun to evolve, becoming more Web-intensive.

"This has led to a marked increase in internally managed applications hosting, and subsequently, security requirements: two of today's most influential application-specific drivers of enterprise bandwidth in this changed economy," Burney said. "However, these customers are still likely to address their changing main and branch bandwidth needs with dedicated lines, where some customers are unwilling to try broadband alternatives, comparable or not."

Key findings of the report, Pipe Filling: The Applications Driving Demand for Broadband in Main and Remote Offices, Part Three: US Enterprises, include:

• Customers in the enterprise market appear to be somewhat hesitant to use broadband in some of their larger sites, with more than 20 percent of those surveyed indicating they wouldn't chose any type of broadband solution for main office locations.
• However, it appears that DSL has the best chance for success among enterprise customers, where 37 percent of respondents indicated a preference for DSL when asked which they would purchase for main office(s) locations if monthly service charges and availability were equal across four types of broadband services: DSL, cable, fixed wireless and satellite Internet. (Multiple responses were accepted.)
• The corporate preference for DSL in the main office is even more pronounced for branch office locations, where 42 percent of enterprise decision-makers indicated a preference for DSL over other broadband alternatives for these smaller sites.
• Nearly 70 percent of those surveyed indicated for each "security" and "hosted or Internet-accessible applications" as being key influencers of their firm's main office bandwidth requirements. Hosted apps were also influential in branch offices, but surprisingly, security was not.

The report is the third of four reports showing the results of In-Stat/MDR's Broadband Applications, 2002 research and the second study in its Business Broadband Multi-client Series. This report reveals the specific business processes and applications that are driving broadband adoption in the enterprise business market, as well as these customers' views on what strategies and telecom services have been contributing to their firms' business performance.

In-Stat/MDR is part of the Reed Electronics Group, a division of Reed Elsevier, a publisher and worldwide information provider.

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