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The percentage of cord-cutters (mobile subscribers who have given up their home phone line) increased from 5% to 8% of US mobile phone customers in the past year. As this group grows, its attributes look increasingly like the rest of the mobile population, especially with regard to age. While cord-cutting picks up steam in the US, Canadians have yet to embrace the trend; only 2% of mobile subscribers north of the border eschew their home phone line. While US and Canadian consumers who refuse to cut the cord agree that security is a big risk, Canadians have an even greater impediment: cost.
More than 50% of online US households are using broadband today. While cable is still in the lead, DSL is gaining ground. With most operators reporting less than 30% sales penetration in their existing broadband footprint, operators will need to re-orient marketing programs to simpler pricing plans, product offerings, and distribution. A universal broadband initiative won't address consumers' desire to purchase services.
North American and European enterprises tell us that they want to buy both mobile and fixed services from their primary networking service provider -- even before fixed-mobile technology convergence happens -- primarily to save on costs. Enterprise demand for fixed-mobile bundled services will grow quickly in the next three years, driving established network operators and outsourcers to offer a broad range of enterprise-grade, integrated, fixed-mobile services. By 2008, tier one operators will offer a full portfolio of enterprise-grade services that bundle wireless and wireline. After 2008, technology will catch up with bundling, and integrated technology offerings will emerge.
Twenty-six percent of EU-5 consumers now have broadband at home. In the next couple of years, European broadband will continue to grow at a healthy pace, thanks to the large installed base of dial-up users. However, from a demandside perspective, high broadband growth rates are not sustainable. A key long-term broadband growth challenge remains shifting the PC adoption rates upward. And in countries like France, there are few dial-up users left to convert to broadband. Nearly 60% of European dial-up users haven't converted to broadband because they see no need for it and find it too expensive. And 64% of EU-5 dial-up users don't know when they will migrate to broadband.
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Hello, telecom and network colleagues,
It has been a busy (and wet) spring here in Boston. Our global Telecom & Networks research team has been busy with research that takes a closer look at all aspects of massive telecom changes for companies and consumers -- with emphasis on mobility, broadband, and IP convergence.
You'll be especially interested to hear about our
new survey data for 2006. Within the month, you'll see new data results for enterprises and SMBs that show demand and plans for mobility, IP adoption, managed services, and much more over the next few years.
We are also doing some forecasts: This summer, look for our predictions for the Extended Internet market (the "Internet of things"), with a global, six-year forecast of hardware, software, and services.
Finally, be sure to mark your calendars for our upcoming Events:
Security Forum 2006: Securing The Business For Tomorrow's Challenges, September 7-8, InterContinental Buckhead, Atlanta.
Technology Leadership Forum: Prospering In The New IT Ecosystem, September 18-20, Scottsdale, Ariz.
Check out our full list of Forrester Events!
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How To Justify IP Communication Costs
Many companies miss the real value of IP communications -- because they struggle to justify network build-out costs and the added services required for system implementation and management. What should they also focus on? The benefits of emerging IP technologies, like session initiation protocol (SIP), which provide increased levels of connectivity and collaboration and result in improved responsiveness to employees, partners, and customers. Enterprise IP communications' business case must not only include traditional savings realized by migration to IP communication telephony platforms but also identify the incremental business benefits for advanced IP applications. When combining traditional benefits and SIP-enabled application advantages, most businesses will realize a positive return on investment (ROI) for IP communications within two to five years.
IT Supports More Mobile And Remote Workers
It should come as no surprise that more companies are supporting broadband access technologies to give employees easy access to corporate information and applications at home, on the road, and overseas. Forrester's recent phone survey of 56 mobile and remote-access decision-makers in North America and Europe found that on average, more than two-thirds of these firms' employees are working away from the office at least five days per month and 21% do so two or more days per week. To achieve the right balance between reduced risk and employee productivity optimization, firms need to centralize their mobility technology as well as services procurement and consider outsourcing.
The US Won't Mandate Net Neutrality
Many have called for the US government to mandate "network neutrality" that will ensure all Internet traffic is delivered equally, consumer choice is upheld, and Internet innovation is not stalled. But it won't happen in the next three to five years. Why? Because no problem exists today, and legislating neutrality will not give consumers the best results. In five years, when rich content taxes networks and broadband adoption approaches saturation, the Federal Communications Commission (FCC) will take a more hands-on approach and intervene if a consumer's access to content and service is being denied.
Hot things:
Please don't miss these Forrester Teleconferences, coming up shortly:
June 16 -- Optimizing Application Delivery With Your Network
June 30 -- Creating A Best-Practice Companywide Mobile Policy -- Why And How?
Please let us know what is of interest to you. Any and all feedback is welcome!
All the best,
Ellen Daley
Vice President, Research Director
ellendaley@forrester.com
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