RealTime IT News

Report: Online Users Have a Need for Speed

As the number of Internet users increases, so does the desire for a faster connection, according to a survey conducted by research firm the Yankee Group.

Forty-one percent of Net surfers were very interested in high-speed Internet access and an additional 43 percent were somewhat interested. Those numbers are up from last year, when only 25 percent of online households wanted faster connections.

The survey also found that users are more willing to pay more for the high-speed data connections. Thirty-six percent of online households are willing to pay $40 per month -- the typical price for cable modem service -- for high-speed access, up from 27 percent last year.

Cable and telephone companies are only beginning to offer fast access. The Yankee Group estimates that about 300,000 subscribers can now receive high-speed Internet service, with telephone companies servicing fewer subscriber with Digital Subscriber Line service.

"From year to year, we have seen that there are more households going online and in those households, more willingness to pay for the advantages of (speed)," says Bruce Leichtman, director of media and entertainment strategies at the Yankee Group. "It's now up to the cable operators and telephone companies to respond."

There is opportunity for either party to emerge, as nearly half of the respondents currently don't know which service they would prefer.

"Today, cable operators have a nearly exclusive window to sell their cable modem service before DSL becomes more of a consumer reality," Leichtman added. "Cable operators should take advantage of this opportunity while it lasts, and move quickly to market their services."

The fast Internet market is slated to boom in the next few years. The Yankee Group predicted that households subscribing to high-speed access will grow from fewer than 500,000 today to 7 million by 2002.