SDSL needs a better sell
Published: 24 Aug 2005 14:15 BST
After three years of a booming Broadband Britain, the sheer failure of symmetrical broadband services comes as a shock. BT's admission this week that most SDSL-enabled exchanges have precisely 0 SDSL users casts a shadow over its whole approach to broadband, and prompts several questions.
The most obvious one is: "What went wrong?" Broadband is an essential tool for businesspeople, from accountants to plumbers. Unlike mere ADSL, SDSL offers a high-speed uplink, making it much more suitable for small firms and branch offices that need to send large amounts of data across the Internet. So why no demand?
BT clearly got its pricing policy for SDSL wrong — as shown by its decision to cut prices by 30 percent from November. At present, ISPs are having to start SDSL at the £150-per-month mark, rising to £350 per month or more for faster services.
BT should have been quicker to learn from the success of ADSL, where take-up exploded into life once retail prices dropped below £30 a month.
Even ADSL had a troubled early life because BT kept prices too high — partly to avoid cannibalising its lucrative ISDN revenues. SDSL, of course, is a threat to the BT's leased line business. However, it would be a brave business which moved from a leased line to an SDSL one, given the kind of service level agreement BT offers for SDSL. Running VoIP over SDSL might not seem like such a bright move if the line crashes and BT doesn't fix it for 24 hours.
The 30 percent price cut is a start, but BT needs to be more dynamic. SDSL must either become more dependable, with BT introducing the kind of SLAs that firms can trust, or it needs to become cheap enough to persuade firms to take a gamble.
Experienced BT watchers know that the telco moves quickest when it feels its rivals are threatening its revenue streams. With ADSL, it was the fear of the cable companies sweeping the table with their lower-priced broadband offerings. With SDSL, the threat could come from the likes of Easynet — which already offers superior SLAs.
Until now, BT has got away with messing up SDSL. But it is Britain's businesses that are paying the price, by choosing not to pay for a service that could potentially boost their productivity. SDSL is an ugly blot on BT's record, which is a real shame given the company's recent progress in broadband. SDSL simply deserves serious leadership; it is now time for BT to show some.
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