StatsAd Industry MetricsBroadband Boosts E-Commerce, New Media Adoption

Broadband Boosts E-Commerce, New Media Adoption

Broadband adoption spurs online activity, but each sector finds its own settling point.

Broadband adoption continues to advance the online experience, but each sector will begin find its own settling point according to a report published by Goldman Sachs, “Americas Technology: Internet,” which forecasts growth for broadband, e-commerce, new media and advertising.

Broadband reached a tipping point this year. Over 50 percent of households subscribe to high-speed Internet access. That number is expected to reach 59 percent by the end of 2005. The report points out 35 percent of narrowband subscribers plan to upgrade to broadband at the $35 price point, though the cost must drop below $29 for significant conversions from dial-up users, unless there’s a severe decline of narrowband functionality.

The gap between broadband and dial-up users is narrowing when it comes to e-commerce. Last year, the average broadband user spent 26 percent more online than their dial-up counterpart. This year, broadband users spend 17 percent more online.

Competition in the e-commerce space is leveling the playing field between smaller vendors and bigger e-commerce players. Lowered switching costs and more efficient navigation make search advertising a practicable platform.

Online media accounts for 20 percent of total consumption for broadband users, up from 16 percent in 2004. The report forecasts online advertising will rise 28 percent in 2005, bringing in $12.3 billion. Currently, four to five percent of ad spending is committed to the online space in the US. That figure is set to reach seven percent by 2009.

The new media sector is also expected to grow. Companies are starting to invest in new services like digital music, online games and video content to address a growing base of home broadband users.

Related Articles

The evolution of display: How is advertisers' use of display advertising changing?

Ad Industry Metrics The evolution of display: How is advertisers' use of display advertising changing?

2y Rebecca Sentance
What can advertising spend tell us about the future of social networks?

Ad Industry Metrics What can advertising spend tell us about the future of social networks?

2y Rebecca Sentance
Breaking down the Facebook auction: How to manage rising CPMs and deliver sales

Actionable Analysis Breaking down the Facebook auction: How to manage rising CPMs and deliver sales

2y Clark Boyd
Our four favourite findings from the ClickZ Digital Advertising Breakfast

Actionable Analysis Our four favourite findings from the ClickZ Digital Advertising Breakfast

2y Leonie Mercedes
YouTube is getting rid of 30-second unskippable pre-roll ads

Ad Industry Metrics YouTube is getting rid of 30-second unskippable pre-roll ads

2y Al Roberts
Ad blocker use continues to grow rapidly

Ad Industry Metrics Ad blocker use continues to grow rapidly

2y Al Roberts
The Year Ahead: Top Resolutions for Digital Advertisers

Ad Industry Metrics The Year Ahead: Top Resolutions for Digital Advertisers

2y Chad Bronstein
Do ad blockers hold the clue to the future of advertising?

Ad Industry Metrics Do ad blockers hold the clue to the future of advertising?

2y Tim Flagg