Will the price cut be enough to persuade Britons to sign up for the broadband 'revolution' with as much alacrity as Americans or our fellow-Europeans?
The difference between dial-up internet access and a high-speed service that is permanently on is akin to that between a horse-drawn cart and a car, which is why there is usually no going back for people who have graduated from one to the other. So it would be churlish not to applaud the sharp price reduction announced yesterday by BT for its broadband service.
Assuming that the internet service providers pass on most of the cut, an average monthly subscription should come down to around £25 from the £40 or so it currently costs. This is by any measure a swingeing cut, and makes broadband service in Britain as reasonably priced, if not cheaper, than its equivalent elsewhere in the world. Whether it will be enough to persuade Britons to sign up for the broadband "revolution" with as much alacrity as Americans or our fellow-Europeans, however, is another matter. Germany already has 2 million subscribers, Britain fewer than 150,000.
The wonders of broadband are not at issue. The technology allows the same line to be used for Internet access and telephone calls without either capability blocking the other. It enables audio and video files to be transferred almost instantaneously. Whole films can be delivered in minutes. So why has Britain been so comparatively slow to adopt the new technology?
The widely-accepted thesis is that high prices have are the main deterrent. Certainly, £40 a month is steep, and those cable companies that supply high-speed internet access have already attracted more subscribers than BT, with monthly payments set at £25. But that is still double the price of many dial-up subscriptions. And for home, rather than professional use, dial-up access is adequate.
The price cuts announced by BT mean that the theory of price as the chief obstacle to wider take-up will now be tested. In fact, consumer resistance may lie elsewhere. Even if the price of fast internet access is going down, the price of computers remains static. And, as with mobile phones, there may be a limit to the range of services that people need or want from computers.
If they are to conquer the mass market, BT and the internet service providers must work harder to convince people that their most hi-tech services are not only competitively priced, but relevant to the lives that most people live. Price is important, but it is not everything.Reuse content