Pressure on utilities to invest in e-business

European utility companies face increasing pressure to invest in e-business capabilities, according to research for US software...

European utility companies face increasing pressure to invest in e-business capabilities, according to research for US software house Convergent.

Guy Campos

The company's surveys of home and business customers in four European countries have revealed strong latent demand for online billing, contract set-up and information services. Two-thirds of those questioned said they would be more likely to buy several utility services from a single company if this could be done using the Internet.

Convergent surveyed 300 Internet-aware consumers in the UK, Italy, the Benelux countries and Spain. Two-thirds of those questioned wanted to pay their bills online within the next five years.

They saw speed and convenience as the major benefits of online billing, but were most concerned about security. However, as many of 23% of respondents thought there were no drawbacks to paying their bills online.

The research found that customers were keen to stay with a brand name supplier, following the lifting of regional electricity and gas monopolies, but would be prepared to switch suppliers for a better price.

"Inevitably the home consumer utility market will evolve into a price war in which numerous companies will be vying for a finite number of customers," said David Pitt, president of Convergent Europe. "Utilities will need to do something to stand out from the already overcrowded market.

"The Internet revolution provides the opportunity for reinvention."

Convergent also found that 71% of European businesses questioned wanted to be able to report faults online, 48% wanted to pay bills online and 45% wanted to be able to set up contracts online.

An overwhelming 83% of business managers felt that relationships with utility suppliers could be improved through better prices and service.

This was first published in October 2000



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