Euro Broadband Growth Shifts Beyond PC

European fixed-line broadband has reached a crossroads, say researchers at Ovum (News - Alert). The annual growth rate of European broadband subscriptions will be 14 percent to 2011. But there will be a change. Demand for broadband to connect PCs to the Internet market has just about reached saturation, Ovum says.

 

Going forward, this will change. Broadband is moving beyond the PC and simple Internet applications to support for numerous devices, providing consumers with a range of multimedia services, Ovum forecasts. This shift will in turn change the broadband access market itself.

 

In most cases, that is going to mean use of broadband to support TV applications, especially Internet Protocol television, which will move from its early "linear video" phase to a new focus on differentiated or new applications.

 

"TV and video services currently represent the biggest new revenue opportunity for broadband service providers," says Ovum. That's an important insight. There is no likely contender for a fourth major, ubiquitous service on the scale of mobile phones, landline phones, multi-channel video or broadband Internet access.

 

Internet access rapidly has become the third ubiquitous service most people use, meaning the PC has joined the telephone and the TV as drivers for the three mass market services, voice, video and data.

 

The next great mass market service is hard to envision, though. Music has not so far proven to have the same power as TV, voice and Internet access. Keep in mind that most people would probably say they "listen to music," but most would not say they subscribe to a service that provides their music. Likewise, there are telemetry and other applications that most say are promising.

 

Still, there is at the moment no obvious candidate for a fifth wired network mass market service on the scale of mobility, wired telephony, fixed broadband or television. That suggests the next wave of broadband revenue growth will have to cannibalize some existing service, shifting revenue from existing stakeholders, and TV is the likely candidate.