DSL, Cable Modems Poised for Takeoff in Small Business Markets

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BOONTON, NJ. March 21, 2000:

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While 65 percent of small-to-medium businesses have connections to the Internet, only 11 percent of these connections are broadband, but by 2002, at least 30 percent of small-to-medium business Internet access will be high-speed, says a new report by Insight Research. Increasing numbers of home-office based businesses and telecommuting workers are fueling the broadband demand.

According to Insight's report DSL vs. Cable Modems: The Future of High-Speed Internet Access, the modest percentage of small businesses with broadband Internet connections is to be expected since economically viable solutions such as digital subscriber lines (DSL) and cable modems have only been available for the past two years. Moreover, these services are not yet available to all who request them. Small office/home office (SOHO) users seek broadband so they can work as efficiently as larger organizations, while teleworkers need to connect with corporate LANs to access company intranets, extranets, and collaborative multimedia applications. With demand for high-speed connectivity intensifying, the report projects that approximately half of small businesses with Internet connections will have broadband access within the next five years.

"Right now DSL and cable modems have nearly equal penetration in small and medium business markets," says Robert Rosenberg, president of INSIGHT. "The pent-up demand means that these customers will choose whatever broadband technology is available first in their area, including solutions where fiber is connected directly to multi-tenant buildings and split among offices."

Additional data in DSL vs. Cable Modems: The Future of High Speed Internet Access, include five-year forecasts of: servable DSL lines, DSL vs. cable modem penetration rates for residential and small/medium business customers, ILEC vs. CLEC DSL lines, price per DSL port, DSLAM equipment revenue, and T-1/ISDN/fiber/other penetration. The report also features regulatory issues, technical discussions, and market analysis. See www.insight-corp.com/adsl.asp for a study excerpt and table of contents.

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Donna Savino

at Insight Research

973-541-9600