What's faster broadband really worth?

The vast majority of Kiwis say they're willing to pay a little extra for faster broadband, but businesses aren't as open to shelling out more for the privilege.

The Commerce Commission today released its final broadband report High Speed Broadband: Content and willingness to pay focusing primarily on what households and SMEs could use high-speed broadband for and how much they were willing to pay for it.

Forty percent of New Zealanders said they would fork out $5 more a month and 37 percent were prepared to pay $5-$10 more a month.

Households spend approximately 82 percent of their broadband usage on HD videos, and this is expected to increase further. The 2011 Cisco Visual Networking Index forecast that video content will grow by 214 percent between 2011 and 2015.

Despite the increasing use of online gaming, the report expects demand will remain relatively small in comparison to video consumption and use of cloud computing.

Not all internet content requires high-speed broadband – think checking emails, watching low-res videos and basic web browsing. However, these services will evolve to use high-speed broadband, too.

The commission also surveyed 500 SMEs to find out how much more they would be willing to pay. Overall 35 percent said they weren’t prepared to pay extra for high-speed broadband and 34 percent were prepared to pay up to 10 percent more.

Around 40 percent indicated an interest in some of the other services high-speed broadband could afford their business, including virtual training, HD video-enabled telecommunications and HD security surveillance.

A quarter said they were dissatisfied with the price, download/ upload time and mobile broadband coverage they currently received. The remainder were very satisfied with their current broadband.

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