This document discusses unlocking borders in Asia for new revenue opportunities through improved connectivity. It notes that Asia relies heavily on submarine cables concentrated in Singapore and Hong Kong, leading to high IP transit prices. Regulatory roadblocks also exist around spectrum allocation and cross-border connectivity. The document proposes the development of an "Asian Information Highway" along existing roadways to provide open-access, carrier-neutral terrestrial fiber networks within and between Asian countries. This would help lower costs, increase broadband access, and maximize use of submarine cable capacity. The United Nations' Asia-Pacific Information Superhighway initiative is working to develop such a network, and the Pacific Telecommunications Council could contribute by joining its working group.

1. Unlocking Asian Borders for
New Avenue to Revenue
Pacific Telecommunications Council
Honolulu, Hawaii
January 18, 2016
Abu Saeed Khan (abu@lirneasia.net)
Senior Policy Fellow
LIRNEasia

2. A miracle had happened in 1997
Oslo 2006

3. Asia keeps Telenor solvent. But how long?
Source: Telenor Group Q3 ’15 Financial Reports.

4. Ericsson Mobility Report November 2015

5. Is Asia ready for 2021?
• Spectrum is critical for GSM/EDGE. Spectrum and
Internet are, however, equally critical for
WCDMA/HSPA, LTE/5G.
• International connectivity is the lifeline of IP
Transit, Cloud, CDN, Data Centers, Peering etc.
• Carriers are centralized in SG and HK. IP Transit is
disproportionately expensive in the region.
• Major regulatory roadblocks in Asia:
– Spectrum lacks technology-neutrality (Demand-side
problem).
– Cross-border connectivity only through submarine
cables (Supply-side problem).
– No carrier-neutral submarine cable, cable landing
stations, gateways, metro and domestic TX networks.

6. Asia vs. Europe: Median monthly IP
Transit prices per Mbps, 10 GigE, Q2 2015
$0.92
$0.96
$0.97
$1.00
$1.00
$1.00
$1.04
$1.12
$1.12
$1.20
$1.25
$1.40
$4.10
$4.41
$5.00
$6.00
$8.00
$9.00
$10.00
$11.00
$14.50
Source: TeleGeography. 10 GigE = 10,000 Mbps. Prices (US$) excluding local access and installation fees.

7. ITU’s “Measuring the Information Society
Report 2015” (Selected Asian economies)
90.6%
87.9%
85.5%
84.6%
82.0%
74.6%
67.5%
49.3%
48.3%
37.9%
34.9%
25.8%
18.0%
17.1%
Individual Internet users (Fixed & Mobile 2014)
3,345
617
95 75 49 47 43 28 27 21 13 6 6 5
International bandwidth per Internet user (Kbps, 2014)
669X
103X

8. “Akamai state of the Internet Q3 2015”
Broadband inequality across Asia Pacific
20.5
15.8 15.0
12.5
10.1
8.7 8.2 7.8
5.1 4.9
3.7 3.4 3.0 2.8 2.5
Average speed (Mbps)
96% 93% 92% 90% 88% 87% 87%
76% 72%
52%
33% 31%
17% 14% 10%
>4 Mbps
68%
59%
54% 51%
29%
22%
18% 18%
4% 2.3%2.2%1.6%0.9%0.9%0.6%
>10 Mbps
45.0%
36.0%
32.0%
27.0%
13.0%
8.2%7.4%5.8%
0.9%0.8%0.6%0.4%0.3%0.3%0.1%
>15 Mbps

9. Tale of two continents:
Akamai reveals the qualitative difference
20.5
15.8 15.0
12.5
10.1
8.7 8.2 7.8
5.1 4.9
3.7 3.4 3.0 2.8 2.5
South
Korea
Hong Kong Japan Singapore Taiwan New
Zealand
Thailand Australia Sri Lanka Malaysia China Vietnam Indonesia Philippines India
Top 15 Asian markets’ average speed (Mbps) in Q3 2015
17.4
16.4 16.2 15.6 14.8 14.5 14.0
13.1 13.0 12.8 12.4
11.5 11.4 11.2 11.2
Top 15 European markets’ average speed (Mbps) in Q3 2015 Landlocked countries.
No direct access to submarine cables.

10. Farewell to segregation:
Technology has democratized global connectivity
Courtesy: Ciena
Submarine networks = Terrestrial networks
Coastal countries = Landlocked countries

11. Terrestrial link
Submarine cable
Infrastructure dictates bandwidth price
• “…..price levels vary by
region and between
terrestrial and subsea
deployments.
• Upgrades to 100Gbps
equipment on terrestrial
networks have been rapid in
recent years as bandwidth
demand has increased, and
European and intra-US
terrestrial routes exhibit the
lowest 100Gbps prices
globally. ”
Source: TeleGeography. 100G: are the potential
savings worth the investment? 4 Jun 2015

12. Terrestrial cross-border links: Normal in Europe, not in Asia.

13. Terrestrial cross-border links: Normal in Europe, not in Asia.
Infrastructure is all about right-of-way

14. Connecting 32 countries with EU through 143,000 km of standardized roadways.
World’s most resilient right-of-way

15. Asian Highway has linked 32 countries.
A cross-border meshed network is to be built.

16. Target: Open-access
• Diversity and Redundancy to all submarine cables linking Asia with
Europe, and USA, through a Terrestrial Consortium.
• Let the offshore and on-shore traffic blend.
– Lower latency with better packet delivery at lesser cost.
• No regulatory disruption.
– Only the licensed carriers will access the Asian Information Highway.

17. • Internet in Asia will be similar to or cheaper than the EU.
– There will be higher ROI in FTTx.
– Mobile broadband (4G/5G) will grow like 2G voice.
• Smart devices and Wi-Fi offload will accelerate the data growth.
– Investments in Transpacific cables will increase.
• Is Asia-Africa-LatAm the possible next long-haul route?
• More international and domestic PoPs will emerge.
Landlocked countries will have bandwidth at equal cost.
Sub-regional telecoms initiatives (GMS-IS and SASEC) have failed to deliver.
Pacific islands will enjoy reduced bandwidth cost in the mainland.
• International Gateway reforms will be accelerated.
– Usage of submarine cables’ purchased capacity will be maximized.
– Carriers will commit longer contracts.
Impacts
Carriers’ unfettered access to Asian market

18. New kids on the block. Who’s next?
Google: Unity (2010), SJC (2013), FASTER (2016)*, COTA (2016).
Microsoft: Hibernia Express (2015), AEConnect (2015), NCP (2015),
Seabras-1 (2016).
Facebook: APG (2015). *Equinix

19. From LION (2012) to AP-IS (2015)
• LIRNEasia has proposed Longest International
Optical Network (LION) along Asian Highway.
• ESCAP has engaged ‘Terabit Consulting’ to study
Asia’s state of broadband and connectivity.
• LIRNEasia was tasked to review Terabit’s reports and
write a Policy Document. LIRNEasia has strongly
recommended deploying fiber along Asian Highway
for an open access network.
• ESCAP rebranded LION as Asia-Pacific Information
Superhighway (AP-IS). It also proposes to amend
the AH agreement to accommodate optical fiber.

20. Connecting 32 countries with EU through 143,000 km of standardized roadways.
PTC should join AP-IS Working Group of ESCAP

21. Thank you
Abu Saeed Khan
abu@lirneasia.net