Broadband better happen soon or you'll never hear the end of it

In Britain, BT has gone after the market in a much more serious waydespite the fact that most people don't yet understand why they shouldwant such a connection.

I hate to return yet again to the topic of the State's broadband internet problem - or rather, the lack of broadband as a problem, since we don't have enough of it for it to be causing problems itself - but someone has to do it.

Let me put it this way: if we get some decent internet connectivity for consumers and smaller business, I promise to shut up on this one. But since we don't even have a widespread, competitive flat-rate internet offering - just a plain old dial-up modem offering, no bells or whistles, that lets you stay online without worrying about the phone bill - someone needs to keep chewing on this old bone (and pretty dry and brittle it is, too).

I'm bringing this up again because I had an interesting talk with one of the telecommunications operators during the week. I know, one rarely has the opportunity of saying something along those lines, but credit where credit is due. And the conversation is worth recounting, if only because it suggests some new ways of thinking about some old problems.

Two weeks ago, this column noted some of the levels of broadband internet penetration in various countries, pointing out our woeful record in the Republic as well as the now quite rapid expansion in Britain. Current figures are that about 20,000 new broadband connections a week are going in across the water.

Some of this is cable connectivity and some wireless but a good proportion is digital subscriber line (DSL), a method that enhances the ability of regular telephone wires to carry data traffic at speeds of 10 to 20 times that of dial-up modems.

The DSL capability is largely being pushed by BT, after the company apparently changed its market view and tactics, deciding to pursue a policy of going after broadband market share in a serious way.

I spoke to the woman behind part of BT's broadband strategy last week, who had come over to talk to BT subsidiary Esat BT about the approach. Ms Trish Jones, BT's southeast regional director, believes the strategy has helped to seed the British market for broadband, and Esat BT is interested in bringing the strategy over here.

She believes broadband brings both social and economic benefits - greater GDP growth, greater access to business markets, greater social inclusion - but she says the problem is that broadband "is a market where people don't know what they don't know". In other words, most people don't yet understand why they should want a broadband connection at home, in schools, at work, at the public library - and that keeps take-up very low. Only 3 per cent of Britain has a broadband connection, she says.

I know, it's easy to argue that BT has been, at best, somewhat recalcitrant in opening up its exchanges so that a competitive market could develop for broadband in Britain, or even just upgrading exchanges so that BT itself could offer high-speed net services across the country.

But at the same time, there's absolutely no doubt that consumers hardly rush en masse to get cable or DSL connections when they are offered. It's a slow process, with consumers and smaller businesses weighing up the costs - even at Britain's considerably lower charges than over here in the Republic - and deciding that they just don't see the benefits. And yes, a flat-rate dial-up offering definitely does help make people see the advantages of an always-on connection, be it low or high speed. But Britain has had a range of flat-rate offerings for a couple of years, and that's still not vastly accelerating the market into DSL or cable broadband.

Ms Jones argues that BT wanted to see if it could develop some sort of demand for DSL before it goes into regions to upgrade exchanges. Which is fair enough. Ms Jones says, by way of explaining the market problem, that BT spent £6 million sterling (€9.5 million) completing a broadband build out in Wales and after 18 months, still only had 1,200 broadband customers.

So, in partnership with the British government and public and private organisations, BT initiated an interesting £12 million trial project in Cornwall, not exactly a part of the countryside where one would imagine angry mobs demanding DSL. BT's corporate commitment was £3 million.

The Act Now project put in place a range of services and supports for small to medium-sized businesses, as well as 50 per cent-subsidised broadband connections, if businesses would commit to getting DSL. For a total of £29.99, the services include the connection, an advisory centre, a help line, educational activities around what DSL is and practical ways of using it within a business, advisers who go out to talk to the businesses, and an online information portal. Consumers were also targeted in information and marketing campaigns.

Finally, people could sign up with their local internet service provider to indicate interest in getting DSL. Communities were told that once they hit a certain target of consumers and businesses committing to DSL, BT would go in and convert the exchanges. Cornwall has 1,650 DSL connections so far - and interestingly, most of that take-up is citizens (300 are businesses). She notes that in 16 weeks, Cornwall hit a demand level for broadband that took Devon a year to reach.

Ms Jones says BT considers the project a great success in developing market demand and she is currently looking at about 10 other British regions for similar projects.

Would the same type of approach work here? Esat BT isn't sure - the market is much smaller, and Esat BT is a smaller operator here as well - but it is throwing out the idea publicly this week.

The company says perhaps Eircom should be the operator to drive such an approach, since it's the dominant operator in the Republic.

At any rate, the company is interested in talking to any interested parties further about the idea.

Karlin's weblog: http://radio.weblogs.com/0103966/