BROADBAND SERVICES

An analysis of factors influencing adoption of broadband services: a case study of South Wales

Literature Review

Broadband is considered to be a technology that offers end-users fast and always-on access to new services, applications, and content with real lifestyle and productivity benefits (Sawyer et al., 2003: 164). International organisations such as the Organisation for Economic Co-operation and Development (OECD) regard broadband as being a vital means of enhancing competitiveness in an economy and for sustaining economic growth (Broadband Stakeholder Group - BSG, 2004: 133; Crabtree, 2003: 29; OECD, 2001: 105; Oh et al., 2003: 2). A number of academic studies appeared in the past have clearly illustrated positive effect of broadband diffusion and use in diverse areas including knowledge creation and dissemination in sub-Saharan Africa (Ha et al., 2008: 164), broadband impact in household context (Choudrie and Dwivedi, 2007: 55), for establishing the internet as a compelling market place (Seifert and Hadida, 2006), impacts on strategic alliance formation (Brown and Pattinson, 1995: 133), and for delivering multi-media services to home (Kodama, 2001: 108). According to a report from the UK BSG (2004), there are a number of ways in which a nation's economy and its citizens' lives can be positively impacted through the adoption and utilisation of broadband:

[…] Societies that adopt, adapt, and absorb the benefits of broadband enabled ICT, services and applications quickly and deeply will achieve significant benefits in terms of productivity, innovation, growth and quality of life as well as significant competitive advantage over societies that don't […]

A recent report by the European Scrutiny Committee (2006,) further emphasises the significance of broadband in aiding the development of nations by asserting that:

The European Union must step up its efforts to encourage take-up of broadband services and stimulate further deployment, in particular in the less developed areas of the Union.

Within the UK context, nationwide efforts by the UK Government and increasing competition amongst the various internet service providers (ISPs) have made broadband access widely available to consumers at affordable prices (Lee and Choudrie, 2002: 105). From the outset, ISPs focused heavily on the single issue of charging a monthly cost for broadband access in order to reach out to new customers.

A comparison of the different subscription packages offered by the various UK providers suggests that their marketing efforts use factors such as speed, download limit, duration of contract and monthly cost as means of attracting customers (www.compare-uk-broadband.com). By doing so, ISPs make efforts in order to reduce their price in comparison to competitors. However, although this may prove to be a successful strategy in the short-term, it can be suggested that a sustainable business model for the long-term requires a detailed understanding of other factors, beyond those mentioned above, that may help ISPs to attract future customers. In light of this, the aim of this paper is to examine the influence of various factors, including utilitarian outcomes (UO), hedonic outcomes (HO) and perceived resources, on the adoption of broadband within UK households.

It is recognised that studies examining the issue of ...