Broadband Could Change E-Commerce Strategy

E-commerce could be turned on its head when broadband Internet connections become common place and consumers are hooked to the Internet all day long.

When such high-speed connections as digital subscriber lines, cable modems and other devices proliferate, industry experts say online companies will be faced with some major challenges — in some cases, even reinvention.

Media Metrix, Inc., a New York online research company, reports that currently there are less than one million U.S. consumers using such broadband connections. But analysts say that as more users climb onboard the high-speed train, their online habits will definitely change.

This explains why such companies as America Online paid $150 million to buy Redwood City California-based When.com. The company’s Web site offers a free calendar that allows users to keep track of their personal schedules and to be notified of upcoming events. This type of program has little appeal to consumers that still use a dial-up modem — because of the amount of time and trouble it takes to make a connection. But for someone who is always online, it’s as convenient as using a personal planner.

Shift in habits

When broadband becomes the standard, analysts also say Internet portals and e-commerce sites will have to reevaluate consumer Web surfing patterns and adjust accordingly. For instance, with current dial-up services, most users surf for an hour or so at a time, while those connected around-the-clock, will probably surf for shorter periods — but many times throughout the day.

This could have an adverse affect on portals such as Yahoo! If consumers are always on, they may choose to be tuned to a Web site like MSNBC in order to get breaking news. After all, this would be possible with broadband. Analysts add that this will force the current Internet gatekeepers to reinvent themselves by offering a plethora of new services in order to make sure consumers tune in throughout the day.

Other casualties

But there is a consensus among industry experts that TV stands to lose the most from broadband connections. Why would consumers subject themselves to the vast wasteland of TV in order to glean a few nuggets of information, when a 24-hour-a-day Internet connection will give them the specific info they want when they want it — minus all the noise? Is it little wonder that cable TV companies want to control broadband and keep it out of the hands of certain e-commerce giants like AOL?

With the industry-wide push for broadband, there’s little doubt that it will soon become a reality for most households in the next five years. But some wonder if it might be like opening Pandora’s box?