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EU ISP's Make 41Bn Euros During 2004
By: MarkJ - 11 January, 2005 (9:36 AM)

The Radicati Group has released the results of its latest study into the European ISP Market, which racked up a healthy 41 Billion Euros in revenue during 2004 out of 3,980 providers:

The consumer market looks set to exhibit a healthy recovery over the next two to four years, supported by strong technology developments, more advanced value-added offerings, and increased Internet usage throughout much of Europe. In 2004, the consumer segment comprised 135M users, generating 16.9B. By 2008, we expect these figures to grow to around 193M users and 24B, representing an average yearly growth of 9.4 and 9.1% respectively.

Over the next four years, we expect the current shift from dial-up to broadband services, to continue, as the price of broadband decreases and users realise the benefits of increased bandwidth. As a result, customers are increasingly opting for monthly tariffs, as opposed to pay-as-you-go packages, throughout much of Europe.

The corporate segment is also set to rise in terms of revenue, but at a lower average rate of 4.4% per year. In 2004, corporate ISPs in Europe generated 59% of total revenues, or 24B. By 2008, revenue from this segment is expected to total 29B and represent 54% of total European revenues.

In terms of Internet services and value-added services, ISPs in both the consumer and corporate segment, are constantly providing new additional services to complement their access solutions, and grow market share. Email and security capabilities are increasingly being included with Internet access, along with an array of real-time solutions and portal services. Whilst some advanced services do incur extra costs, the gap between basic and advanced features is becoming smaller, as for instance we see ISPs including more email addresses, larger mailbox storage, and higher SMS limits, as free services.

A range of new technologies look set to make a major impact on the ISP market over the next decade, in particular Fixed Wireless and FTTx (Fibre to the Home/Neighboorhood). Fixed wireless technology is expected to move on from WiFi to WiMAX, opening up a number of major opportunities in not just Internet access, but converged voice and mobile access. FTTx on the other hand has the potential to offer significantly higher speeds for Internet access at low cost. This would provide access to organisations and individuals via an extensive fibre-optic network.


By 2008 ISP revenues should have hit 52.5Bn.


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