London mayor Ken Livingstone is keen for the capital's small and medium-sized businesses to make the most of broadband opportunities, and is preparing to take action to boost adoption and awareness levels.

Early next year the Greater London Authority (GLA) is due to issue a report highlighting the fact that many SMEs in the capital are still unaware of the benefits of broadband. It will call for government policies in London to focus on identifying the potential benefits broadband has to offer businesses. Livingstone has already called for more competitive and affordable broadband access and highlighted the need for London boroughs to identify and support the development of new e-businesses.

The national debate about broadband has tended to concentrate on its availability, especially in rural areas. London has the advantage of near ubiquitous availability of broadband services, but the GLA still thinks SMEs need to be reminded of the commercial advantages of always-on internet applications and content.

"Almost every London home and business has the capacity to connect to broadband," points out a GLA spokesman. "In London, take-up is around 7%, which may be double the national average but is still very low."

Policy makers in the capital believe broadband services have a key role to play in the future economic life of the city. Their main argument is that high-speed broadband business connections will improve opportunities for London companies and individuals to collaborate and innovate together to improve productivity levels and attract new business to the capital.

The news that the mayor of London aims to persuade more SMEs to upgrade to broadband services has, not surprisingly, been welcomed by ISPs. Brighton-based ISP Mistral, which supplies broadband products to SMEs in London, says that current order levels are healthy.

"We're hitting targets every month. We're getting loads of broadband inquiries," says Kat McClure, Mistral's marketing manager. She adds, however, that some SMEs are holding out in the hope that prices might come down further. "It's quite a cost-driven market at the moment and because there were some problems initially with ADSL, they are a little bit cautious."

Despite the aggressive marketing of broadband, analysts are undecided about the impact the new technology could have on the economic life of the capital or other cities in the UK. "I think broadband can improve the business efficiency of companies. I'm not sure about the evidence of it leading to real economic growth," says Susan Richardson, an analyst for Gartner. "Broadband is quicker. It's more flexible. It does make SMEs more open to new types of services like video or sharing information. It facilitates net meetings with partners and it helps with people working from home."

With broadband becoming increasingly fashionable in business circles, politicians are keen to be seen to be associated with its adoption, which could partly explain Livingstone's high profile enthusiasm. "It is the thing to be doing at the moment," says Richardson. "We have started to gain a momentum which has been lacking for the last three or four years."

Whether Livingstone's broadband push is likely to have a far-reaching impact remains to be seen. It will definitely stoke the prevailing pro-broadband climate. But in practical terms SMEs in London are probably more likely to upgrade to broadband in response to pressure from their major customers and suppliers.