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Broadband Penetration in Europe to Hit 20 Percent
May 27, 2004
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Europe will have 33.5 million broadband subscribers by the end of this year, representing 20 percent of all homes, according to the latest research from consulting firm Strategy Analytics. Lack of competition, however, is leaving Europe's largest markets trailing behind smaller, more nimble countries.

According to the firm's research, broadband penetration in the UK, Germany, and Italy reached only 13 to 15 percent of homes at the end of 2003, only half the level of leading countries such as Belgium, the Netherlands, and Denmark. The firm also predicts that broadband will increasingly be used to offer the so-called "Triple Play" of Internet, telephony, and video.

By 2008, Strategy Analytics expects 41 percent of European homes to subscribe to broadband, in line with its previous forecasts. Sweden, Switzerland, and Belgium, where there are strong competitors to the incumbent telco network operator, will be the leading countries, with penetration rates of between 55 and 60 percent.

"Europe's smaller countries have demonstrated that loosening the grip of the incumbent telcos is critical to faster, wider broadband adoption," notes Principal Analyst David Mercer.

"Broadband marketing is now entering the third phase in its evolution," adds Martin Olausson, Senior Analyst. "Price tiering aimed at different user segments is now widespread, but successful service providers will be those that embrace multiple broadband services such as Voice-over-IP and video."

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