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Study: ISPs Must Choose Between Content and Network Services

From uk.internet.com

In a report that analyzes the key issues troubling Internet Service Providers (ISPs), telecom and IT analyst group Ovum Ltd. concluded that ISPs need to choose between offering top-quality content or efficient network services, instead of doing both poorly.

Ovum's report, "The Internet Access Market: Opportunities for ISPs, Telcos and Content Providers," pointed out that the quality of connectivity and content services is below expectations--and declining as the infrastructure of the Internet gets more crowded.

"At present, most ISPs are trying to follow a strategy of being a full service provider offering both network and content services," said Daniel Bieler, one of the authors of the report. "However customers are demanding more professional services and more network reliability and most ISPs are failing to establish a competitive position in both markets."

"Few ISPs are able to offer both network and content services," he continued. "Content focused ISPs must secure premium information for their corporate customers and premium entertainment for their consumer customers. As for network focused ISPs, higher emphasis will be on performance and multimedia connectivity for corporate customers and if supporting a content focused ISP, multimedia access will be important for re-sale to consumers."

Ovum said that among the major problems are the threat from digital television that will allow access via set-top boxes; the increasing difficulty of making money from dial-up access; the difficulty of maintaining service quality because of routing and switching delays; and the challenge of providing interesting content.

The report, "The Internet Access Market: Opportunities for ISPs, Telcos and Content Providers," by Daniel Bieler, Iain Stevenson and Jerry Shen, costs GBP995 in Europe.

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