Businesses urged to trust e-technology

Encouraging consumers to take up broadband is the key to future Internet sales. Daniel Thomas reports

Encouraging consumers to take up broadband is the key to future Internet sales. Daniel Thomas reports

Last week, four of the UK's leading think tanks, representatives from the government and the IT industry issued a call for an end to the scepticism that has hampered the e-business world since the dotcom crash of the late 1990s.

Delegates at the conference, Beyond The Backlash, were told that the Internet still has the potential to create social and economic change, despite the well publicised dotcom disasters.

The conference was organised by Demos, the Institute for Public Policy Research, Forum for the Future and the Work Foundation's iSociety, Charles Leadbeater, an independent advisor on Internet issues to the government and leading companies, said that too much focus has been placed on the financial potential of Web technologies.

"Technology is a force for innovation and experimentation, but this was hijacked by finance during the dotcom boom," he said.

"The Net can also have an impact on democracy, through the expansion of free media and the growth of non-governmental organisations."

Stirring stuff, but if the Internet is to make a significant impact then broadband adoption will have to increase, said Ed Richards, social policy advisor to the Prime Minister on IT.

Next week, he said, the government is staging a major e-summit to address the issue, with contributions from Tony Blair, e-commerce minister Stephen Timms, trade and industry secretary Patricia Hewitt and cabinet office minister Douglas Alexander.

"This will help us to identify the next step for UK broadband," Richards said.

"We have to ask why the Internet has not affected the macro economy, because we believe the UK is well placed to boost productivity with investment in ICT."

Richards rejected the conclusions of last week's report from Demos which said BT should be broken up in order to boost the rollout of broadband.

The report's author, James Wilsdon, had said the UK is "sleepwalking towards a broadband monopoly", but Richards suggested this was "a soundbite too far".

"There is far more competition in the UK than in countries such as France and Germany," he said.

Much of the broadband debate centred around infrastructure issues such as the competition between telecomms operators, opening up of the local loop and spectrum availability - to the frustration of some of the delegates.

"The broadband discussion is too vertical, no one is talking to the people who are going to be using it," said one. "Why not focus on benefits, rather than the bit-rate?" asked another.

This emphasis on the speed of connection to the Internet, rather than on what it allows the user to do, has been an unfortunate feature of broadband discussions to date, according to the Broadband Content Coalition (BCC), an industry-based lobby group.

"If broadband Britain is to become a mass market reality, whether delivered via ADSL or 3G-enabled devices, the availability and ability to distribute content has to be key," said Sandip Sarda, the chairman elect of the BCC.

"Expecting consumers to fork out hefty monthly subscriptions for a fast Internet connection alone is not enough."

Research published last week by analyst firm Jupiter Research confirmed that scepticism about broadband among European consumers remains high.

The research, which pegged UK broadband adoption at a mere 7%, found that 25% of existing Internet consumers in Europe would not get a high speed connection at all, with a further 29% unlikely to get one.

"There is no strong motivation for users to upgrade at the moment," said Dan Stevenson, analyst at Jupiter Research. "This also applies to many small and medium-sized businesses."

However, there are signs that the industry is beginning to focus more on the end user benefits in an attempt to increase the interest in high speed Internet services.

The government-backed Broadband Stakeholder Group will announce the launch of three broadband user groups at its annual conference next week.

Its chairman, Keith Todd, said the move is designed to counter scepticism from users unconvinced by the largely technical broadband argument.

"The first step was to look at the infrastructure issues but now we want to look at users," he said. "That is why we are establishing three user groups - one for business, one for the public sector and one for the individual." There will be no single 'killer application' that boosts take-up of broadband, Todd said, as different users have different needs.

While it is true that the Internet was never going to mean the end of schools and supermarkets, the dotcom crash did not mean that the Web turned into a completely useless tool either.

That was the underlying message from the Beyond The Backlash conference, but the industry needs to continue to focus the broadband argument on the benefits rather than the technology, if any of the initial promises are to turn into reality.

What slowed investment in e-business?
  • Too much focus on the financial effects of the technology

  • Broadband adoption needs to increase

  • Broadband debate has centred too much around the technology, rather than the needs of the user

  • Scepticism about the benefits of broadband remains high among European consumers

  • There is no strong motivation to upgrade to broadband

  • Limited availability of broadband access is stifling social and economic progress.

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