Europe surfs the broadband wave

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Business Week reports: Europeans are signing up for broadband in ever increasing numbers. PricewaterhouseCoopers figures European clients will spend $24 billion this year alone for zippy cable and DSL connections, rising to $42 billion by 2008. The penetration rates in Europe are going through the roof, and so is the broadband-economy.

> London-based Continental Research found that when British Web surfers upgrade from dial-up service, they’re more than twice as likely to download music, use instant messaging, or frequent online auctions. Use of Net radio stations and online games more than triples.

Here are some stats. France Telecom increased its DSL subscriber base by 65% in one year, to 3.4 million while the Netherlands, which leads Europe in broadband penetration at 47% of households, KPN had a 51% first-quarter rise in DSL revenues vs. the same period in 2004, to $131 million. This is clearly because of deregulation and increased competition which is forcing incumbents to react and counteract the new entrants who are using cheaper plans to lure customers. (If Bulldog is any indication, cheaper almost never a better option!)

> Online music sites are also ringing up record sales. Deutsche Telekom’s T-Online unit has drawn 1.5 million users to its Musicload service, which sells more than a million downloads per month. Apple Computer Inc.’s (AAPL ) iTunes is now available in 16 European countries. And European users listened to 14 million songs in June via Yahoo’s new streaming music service. By 2008, online music could be a $2.4 billion business in Europe, predicts Forrester Research. Online viewing of music videos is taking off as well. “We’re seeing massive increases in the numbers of videos consumers are accessing,” says Barney Wragg, senior vice-president of Universal Music Group eLabs in London.

What it really means is that unless we see some serious upgrades in speeds, technologies this country invented will become the tools of economic acceleration for rest of the planet, as we linger behind.

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Jesse Kopelman

While I would like something faster, especially on the uplink, than my current Comcast service, I am not to concerned about the US falling behind on that front. The bigger issue is making broadband available to all. I think the issue is on par with access to paved roads and electricity. I think the government has to be involved one way or another. Either by becoming an alternative provider on a municipal level or by regulation on a federal level requiring carriers to provide low cost service to qualifying people and an increased timetable for required population coverage by a wireless licensee.

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