Market segments and business models

It is becoming apparent that broadband communications options — like Internet telephony — will become extremely popular in Germany in the near future. A similar trend is reflected in the future significance of the broadband communications market. According to expert estimates, this market segment will carry the greatest weight within the broadband market as a whole in both 2010 and 2015 (Fig. 3).

Figure 3:		Importance of various market segments to the broadband market as a whole through 2015 (broadband experts, digital home experts and experts from government agencies)

By the year 2010, the broadband access market is expected to be the second-most important market segment for broadband. But after that, according to the experts, there will be a shift at the top. By the year 2015, it is expected that broadband content will be the most significant segment after communications. Almost 80 % of respondents are of the opinion that broadband content will assume a high to very high level of importance in ten years’ time.

Clearly, communications, content and access are the most important and most promising segments of the broadband market. How can these trends be put to the best possible use and by whom?

This initially raises the question of who will lead the way: specialist suppliers of products and services focusing on a single market segment, or integrated providers representing a one-stop shop for different products and services. The experts consulted were clearly of one mind on this matter: integrated business models will dominate the future of the broadband market in Germany (Fig. 4).

Figure 4:		Significance of various business models in the broadband market through 2015 (broadband experts, digital home experts and experts from government agencies)

The next broadband decade will have two major aspects. The majority of respondents (around 67%) predict that by the year 2010, integrated access and communications suppliers will be making the running. The phase leading up to 2010 will therefore be clearly dedicated to further developing and expanding the infrastructure required for broadband communications services. Experts believe that the period from 2010 to 2015, on the other hand, will be marked by increased inclusion of content in these access and communications packages. Around 82% of the experts consulted ascribed a high (around 35%) to very high (around 48%) level of importance to integrated business models offering access, communications and content by the year 2015.

Broadband technology opens up a host of different purposes and content. The more broadband is made available, the more offerings and options will be developed and used. As transmission speeds increase, options like Internet telephony and Video on Demand will become central drivers of growth. This trend is already emerging as a clear pattern.

Companies will naturally adapt to these customer preferences. But primarily it is a matter of offering customers the opportunity to use different broadband applications from a single source. The integration of the three segments of communications, content and access represents the Triple Play business model, which is destined to have a huge strategic impact on the development of future broadband markets.