Hello? Dial-Up Isn't Dead, Cheap Internet Service, Low Cost Internet Access

Today's Trend: Although more and more people are switching to broadband, dial-up service is tenaciously hanging on--60% to 70% of people who access the Internet still do so this way. "The nature of the market is changing," says FIND/SVP Technology Consultant James Belcher, with people demanding more of existing systems and Internet service providers responding, albeit reluctantly.

Why: From the consumer point of view, dial-up is cheap, and "much as people won't switch banks, there's a perceived barrier to switching services. Many don't see the value of broadband for an extra $200 a year," says Belcher. From the ISP end, dial-up is a steady revenue stream, and "it's a model that providers understand."

Opportunity: Providers are repositioning dial-up, notes Belcher, and are looking for ways to push away from the idea that it's "old, it's dead and nobody uses it." New accelerating technologies have already made it faster. For companies looking for a toehold in this new/old market, anything that adds value without too much cost--better speed, resolution, content or service--will make an impact. And it's the marketing, stupid. "The pie isn't going to get any bigger, and with bargain providers like NetZero [which was absorbed by United Online] offering access for $14.95, whether ISPs like it or not, they're going to have to continue to fight for mind-share."

Danger: The leakage to broadband will continue, and providers that turn away from service values and see their subscriber base as just a way to lure advertisers risk alienating the very people they're trying to keep on the line.

Read complete article at: Forbes.com

Courtesy of Forbes.com and FIND/SVP

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