Spend on business data services in Europe will plateau at EUR29 billion in 2008.

Growth in spend on fixed business data services in Europe will slow dramatically from 2008, according to a new report, Business Data Services: growth opportunities and forecasts for Europe 2007-12, published by Analysys, the global advisers on telecoms, IT and media. This will put pressure on service providers, forcing them to either innovate or consolidate to stay in business.

"Competitive pressures on suppliers and the emergence of Ethernet as an access technology for MAN and WAN mean that companies continue to get more bandwidth for the same money at every upgrade," says the report's author, Margaret Hopkins. "Service providers have to find new ways to generate revenue or else they must consolidate to survive."

Key findings from the new report include:

--Companies are bewildered by the maze of data service offerings in the MAN and WAN and are turning to systems integrators for impartial advice. This is leading to a loss of managed services business for telecoms service providers.

--The SME market remains largely untapped as existing service offerings and distribution networks do not meet users' needs--but there are signs that this is about to change.

--Data customers need reassurance about the more to next-generation networks. Users are not yet convinced that next-generation networks will offer the security and reliability that they have long been able to expect from their legacy data networks. Informed by interviews with end users, user groups and service providers, Business Data Services: growth opportunities and forecasts for Europe 2007-12 reveals the current market drivers and key trends in fixed business data services, and considers how new technologies and standards, such as E-LAN and Ethernet over copper, will affect the market. The report examines the reasons for the failure to develop the SME data market and the changing role of systems integrators in procuring and managing data network services. Forecasts of spend on business data services for the period 2007-12 are provided for France, Germany, Italy, Poland, Spain, Sweden and the 15K, with totals given for Western Europe and for the EU accession states as whole.

The forecasts are split by service (Internet access; point-to-point circuits; IP VPNs; and Layer 2 VPNs), access technology (broadband; FR; ATM; Ethernet; and SDH, WDM and other) and size of business site (large; corporate small; and SME small).

The report is available to purchase online at http://research.analysys.com/store, priced at GBP1700 (approximately EUR2450) plus VAT.