Broadband Divide Among SMEs

Abstract

While the digital gap between large and small firms is a fairly well-known phenomenon, this article focuses on the divide within SMEs. Specifically, the aim is to analyse factors that may explain the differences in broadband adoption among SMEs and to explore their significant interrelations. The investigation relies on a two-step procedure: first, using a tree-based technique, relevant variables and interactions are explored; then, through a binomial logistic regression, their impact on broadband diffusion is estimated and tested. Findings confirm that the relative size of the company (a proxy for firm’s internal resources) is still relevant among SMEs; in addition, the geographical area where SMEs are located (environmental resources) can act as a further obstacle especially for the smaller companies of the sample; finally, specific ICT organizational strategies - namely the outsourcing decisions - proved to be an important mitigating factor for size and location-based broadband disadvantages.