Broadband services- recession proof

Consumers are more likely to give up travel and dining out rather than shed their broadband connections during recessionary times, according to a series of recent studies sponsored by Alcatel-Lucent.

The study suggests that broadband services are nearing  recession-proof, with 84% of consumers identifying broadband as an essential network service and therefore the least likely target for spending cuts. The study also revealed that more consumers globally are planning to subscribe to and/or upgrade their broadband services, at the expense reducing spending in other areas.

Drivers for increased connectivity include a desire to reduce the cost and travel time associated with commuting, coupled with a preference for greener alternatives.

“This clearly shows that people across the world rely on broadband services as a central part of their social and economic lives,” said Tim Krause, CMO for Alcatel-Lucent. “As the world looks at ways to address the twin challenges of economic growth and climate change, our research shows that broadband and the digital economy must absolutely be at the top of decision making agendas.”  

The global study, conducted by of Alcatel-Lucent’s Market Advantage Program (MAP)  and market research firms Penn, Schoen & Berland Associates and Ipsos MediaCT determined how consumers prioritize household spending, during a downturn, comparing the relative value of a wide variety of services.

Attitudes about broadband cut across regions and socio-economic strata, the study showed yet distinctions appeared in attitudes about the economy between consumers in high-growth markets and those in more developed markets.

In France, for example, consumers indicate that the financial crisis has had a greater negative impact on their household compared to emerging markets who were more optimistic about the future than those in developed countries around the world. While two thirds of consumers indicated they are cutting expenditures, 85% of consumers from emerging countries forecast that their household economic situation would be the same or better a year from now compared to 64% of respondents in the developed countries.