Europe Will Follow UK Lead In Net Access, Say Analysts

In a new report, analysts at Yankee Group Europe say that
continental high-street brands will follow the UK lead in offering Internet acccess.

“Lured both by the short-term opportunity to re-brand themselves as an Internet company and by the long-term potential of electronic commerce, retailers, banks and media companies across Europe are set to become ISPs,” says David Pringle, senior analyst in the Yankee Group’s Internet Strategies Europe service.

So far, only a handful of European companies have tried to emulate the success of Dixons’ Freeserve, although many UK organisations — including the BBC’s freeBeeb Web service, which announced free
access this week — have entered the fray. An exception is the French electrical goods retailer Darty which has started a branded Internet access service.

The Yankee Group reminds us that continental telecoms markets are now becoming more competitive. As a consequence, variants on the free access ISP model are beginning to emerge in Germany, France,
Italy and Switzerland.

“We expect to see more continental retailers and banks partner with second-tier telcos to challenge incumbent telcos’ ISP services,” says Pringle.

If there is a “dream team” in the Internet service business, Pringle goes on to say, it would consist of a major telco to provide the infrastructure and run the service, a retailer or bank to bring a trusted brand and a distribution network, and a new media company to provide content to keep site visitors coming back.

The new report, which launches the Yankee Group’s Internet Strategies Europe Service, examines competition for Internet access in Europe.