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European broadband continues to grow

The European broadband markets continue to witness strong growth, thanks largely to the deregulatory initiatives across the region and the ongoing shift towards integrated services such as triple or quad play, reports consultancy Frost & Sullivan.

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The growing demand for highly customised broadband-based services is also a major growth factor, as customers are willing to pay that little extra for high-quality broadband services such as video on demand, pay-per-view TV and other attractive multimedia content, according to new analysis from Frost & Sullivan - Broadband Market in Europe.

The report finds that the markets earned revenues of €27,302.9 million in 2006 and estimates this to reach €93,941.3 million in 2013.

"As we begin to embrace the era of digital lifestyles, service providers have begun to focus on providing interactive communication services," notes Frost & Sullivan Research Analyst Julia Martusewicz-Kulinska. "Even in the more nascent markets of Eastern Europe, commoditization of access is driving value-added services and triple play."

Western European broadband markets are generally much more saturated and mature than the Central and Eastern Europe (CEE) markets.

Therefore, the penetration of broadband lines is growing at a higher rate in the CEE region than the Western part of the European Union. Over the period 2006 to 2008, the growth rate for the CEE segment of the market is expected to exceed 30 per cent, while the Western European segment will exceed 20 per cent.

However, competition levels are expected to increase as business models are changing and market participants are becoming more competitive and technological advanced. Developing strategic partnerships that allow them to provide a wider range of services, namely bundled offers and value-added services (VAS), will be also a key challenge for service providers.

"One of the key challenges for service providers is identifying partners who will be able to provide a strategic fit in introducing bundled offers," explains Martusewicz-Kulinska. "Fixed service providers need to sustain their market position by offering new compelling services and for that, they would usually need to  partner with solution providers that specialize in either wireless or content services."

In order to maintain customer base and increase revenues, operators should focus on selecting a reliable business partner who will deliver quality services. As the value chain extends further, the importance of quality and reliable outsourced services will become more critical for service providers.

According to F&S, Broadband Market in Europe is part of the Communication Services Growth Partnership Service programme, which also includes research services in the following markets: European IPTV Markets, Wholesale Telecom Spending by Wireless Providers, Fixed Mobile Convergence - Service Providers' Case Studies, Triple Play in Eastern Europe (planned for Q1 2008).

For more information about Frost & Sullivan's research, visit


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