DSL Usage Expected To Grow Among Small Businesses

The number of DSL lines connecting businesses to the Internet is projected to increase to 1.5 million in North America, compared to 830,000 lines as of the end of last year, the Probe Group LLC said. Revenue from DSL lines last year was $964 million.

Businesses today account for less than 10 percent of the total DSL market, which is dominated by consumers. The Probe Group, however, points out that between 30 to 40 percent of small businesses still use dial-up connections and are potential customers for carriers willing to target the group with special packages that include local and long distance services.

"This is a strong growth market for carriers, and they should make their products more attractive by offering bundled services," Probe Group analyst Alan Mosher said.

In the broadband market, DSL competes with cable for businesses with less than 100 employees. Among the advantages it has over cable, however, is accessibility.

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DSL, or digital subscriber line, is technology that boosts the digital capacity of telephone lines, which means the high-speed service is usually available in business and warehouse districts. These areas are often the home of small businesses, and not usually accessible by cable.

"Cable runs in most homes in urban areas, but it doesn't necessarily run in industrial areas," Mosher said. "It's been primarily seen as a residential service."

DSL providers, however, have to move quickly to grab more broadband business with bundled services. Hot on their heels are companies trying to undercut prices for local and long distance services with emerging voice over Internet protocol, or VoIP, technology.

VoIP enables businesses to cut communications costs by using their high-speed Internet connections for voice communications.

This story courtesy of TechWeb.