Benchmarking the Asia-Pacific Broadband Divide


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  • The Asia-Pacific Broadband Divide” or “A Broadband Opportunity Index”.
  • Malaysia The MyICMS 886 (Malaysian Information,Communications and Multimedia Services 886) Strategy identifies eight (8) service areas which have been targeted to propel Malaysia in the delivery of advanced information, communications and multimedia services towards improving the quality of life of Malaysians and at boosting Malaysia’s global competitiveness. India A Broadband Policy was adopted in 2004 where broadband was defined as: “ An ‘always-on' data connection that is able to support interactive services including Internet access and has the capability of the minimum download speed of 256 kilo bits per second (kbps) to an individual subscriber...” Although the policy recognized the importance of broadband for social and economic development, it did not propose many specific actions for accelerating growth other than liberalizing license and spectrum regulations. The policy specifically stated that copper line was not a "bottleneck facility" so did not mandate local loop unbundling. Nor did it require cable television networks to provide access to their networks. The policy also noted that various government agencies, both national and local, were important for accelerating broadband growth but did not specify specific programs. The policy did call on the government to work with equipment manufacturers to develop inexpensive broadband equipment. It also called on the government to work out plans for making the cost of broadband service affordable, again without providing details. The government proclaimed 2007 the "Year of Broadband" in India. [1] However at year end, targets for broadband subscriptions established in the 2004 Broadband Policy had not been met. In 2007, the Telecommunications Regulatory Authority of India (TRAI) issued a set of recommendations for promoting broadband development based on an earlier consultation. [1]
  • BSNL and MTNL should be encouraged to appoint franchisees for providing broadband services to supplement their efforts. Any procedural restrictions/ limitations to be addressed immediately. • TEC should undertake certification of different CPEs model for interoperability for provisioning of the broadband. All CPEs conforming to specifications for interoperability should be displayed on TEC website for the information of customers. • Incumbents may declare future plans for providing broadband using DSL technology to encourage manufacturing of CPEs within country . • Government should expedite decision on TRAI’s recommendations regarding mechanism and pricing of Spectrum for 3G & Broadband Wireless Access.
  • Benchmarking the Asia-Pacific Broadband Divide

    1. 1. Benchmarking the Asia-Pacific Broadband Divide Michael Minges Senior Market Analyst
    2. 2. References Designed Digital Access Index Worked on Digital Opportunity Index
    3. 3. Contents <ul><li>Update on the ITU Digital Opportunity Index (DOI) </li></ul><ul><li>Benchmarking broadband </li></ul><ul><li>The Asian broadband divide </li></ul>
    4. 4. ITU Digital Opportunity Index (DOI) <ul><li>What is Digital Opportunity? </li></ul><ul><ul><li>The whole population having easy access to Information and Communication Technologies (ICTs) at affordable prices; </li></ul></ul><ul><ul><li>All homes equipped with ICT devices; </li></ul></ul><ul><ul><li>All citizens having mobile ICT devices; and </li></ul></ul><ul><ul><li>Everyone using broadband. </li></ul></ul>
    5. 5. DOI trends 2000-2007
    6. 6. DOI in detail Taiwan Source: Adapted from FIND, NCC, DGBAS.
    7. 7. DOI Asia-Pacific
    8. 8. Benchmarking broadband
    9. 9. Importance of broadband <ul><li>“ Highspeed broadband, which a few years ago was considered a luxury is today a necessary part of the industrial, commercial and lifestyle landscapes.” –Government of Malaysia </li></ul><ul><li>“ Recognising the potential of ubiquitous Broadband service in growth of GDP and enhancement in quality of life through societal applications including tele-education, tele-medicine, e-governance, entertainment as well as employment generation...” —Government of India </li></ul><ul><li>“ Broadband not only plays a critical role in the workings of the economy, it connects consumers, businesses, governments and facilitates social interaction.”—OECD </li></ul>
    10. 10. Broadband penetration OECD December 2007, per 100 people Source: OECD, NCC.
    11. 11. Aspects of broadband <ul><li>Different aspects of broadband beyond just penetration </li></ul><ul><li>OECD has identified some but not all </li></ul><ul><li>Fixed versus wireless / mobile broadband </li></ul>Source: OECD.
    12. 12. Broadband penetration <ul><li>Even among high income economies, significant difference in basic broadband penetration statistic </li></ul><ul><li>Closer inspection reveals some surprises </li></ul>Broadband subscribers per 100 people, 2007
    13. 13. Penetration by sector % households with broadband, 2007 Households with Internet % businesses with broadband, 2007 Businesses with Internet
    14. 14. Competition <ul><li>A more competitive broadband market, including a variety of technologies, tends to result in higher broadband penetration </li></ul><ul><li>Competition can be measured by both technology and operators </li></ul>Technological HHI, 2007
    15. 15. Pricing <ul><li>Wide variety of plans, coverage & exceptions / restrictions inhibit ability to compare broadband pricing: </li></ul><ul><ul><li>Highest speeds not always universally available </li></ul></ul><ul><ul><li>Data or time volume caps in Australia, Hong Kong (some plans) and New Zealand </li></ul></ul><ul><li>8 Mbps download is only comparable plan (with 10 GB download) </li></ul><ul><li>Ongoing promotions, bundled offers, etc. make comparisons difficult </li></ul>One month ADSL, 8 Mbps, 10 GB, 2008
    16. 16. Speed <ul><li>Composite measure of speed in use desirable but comparable data not available: </li></ul><ul><ul><li>Australia: 30% < 512 kbps; 3%> 24 Mbps </li></ul></ul><ul><ul><li>Hong Kong: Over 60% of customers using > 25 Mbps (HKBN) </li></ul></ul><ul><ul><li>Japan: 40% fiber optic </li></ul></ul><ul><ul><li>Taiwan: Average download speed 3.56 Mbps (CHT) </li></ul></ul><ul><li>Fall back on broadband as % of Internet in homes </li></ul>Range of mass market broadband plans, Mbps, incumbent operator, 2008
    17. 17. 3G Mobile <ul><li>3G mobile technology supports broadband speeds </li></ul><ul><li>Indicators: </li></ul><ul><ul><li>3G subscribers as % of total mobile subscribers </li></ul></ul><ul><ul><li>3G subscribers per 100 people </li></ul></ul><ul><li>3G data cards </li></ul>3G mobile as % of total, 2007
    18. 18. Coverage <ul><li>Definitions vary: number of lines upgraded, population covered or households which could subscribe: </li></ul><ul><ul><li>Australia: 81% DSL coverage </li></ul></ul><ul><ul><li>Korea: 100% DSL coverage </li></ul></ul><ul><ul><li>Japan: 95% households have one or more broadband service; 84% have “ultra-high speed” broadband coverage </li></ul></ul><ul><ul><li>Hong Kong: Fiber available to 2/3 of households </li></ul></ul><ul><ul><li>New Zealand: 93% DSL coverage </li></ul></ul><ul><ul><li>Singapore: Singtel has island wide DSL coverage </li></ul></ul><ul><ul><li>Taiwan: “Substantially all installed telephone lines capable of delivering ADSL services” </li></ul></ul>
    19. 19. Usage example: IPTV Note: excluding Japan.   6% Launch 2007 27 SingTel 26   52% 10% 128 HKBN 15   5% Launch 2007 325 Korea Telecom 9 11% 58% 394 CHT 8 . 51% 25% 628 PCCW 5   22% 305% 810 Hanaro 3 IPTV service % broadband subscribers Change 06/07 2007 Subscribers 000s Operator World rank
    20. 20. Broadband index results 6 5 7 1 4 2 3 Penetration rank 5 3 6 2 1 7 4 Mobile 3 4 7 1 6 1 5 Home speed 2 4 5 3 1 6 7 Price 7 3 5 1 2 4 6 Competition 2 3 6 1 5 4 7 Sector use 4 3 6 1 2 5 7 Overall rank 0.63 0.67 0.45 0.79 0.71 0.52 0.40 Score Taiwan Singapore New Zealand Korea Japan Hong Kong Australia
    21. 21. The Asia-Pacific broadband digital divide
    22. 22. Broadband divide in Asia-Pacific
    23. 23. Top broadband providers versus top mobile providers in Asia Developing countries Source: Adapted from company reports. Top 10 broadband operators, 2007 Top 10 mobile operators, 2007 1,721 LG Powercom (Korea) 2,135 KDDI (Japan) 3,658 Hanaro (Korea) 4,243 CHT (Taiwan) 4,598 Telstra (Australia) 5,164 Softbank (Japan) 6,516 Korea Telecom 12,960 NTT (Japan) 19,768 China Netcom 35,650 China Telecom 000s Operator 4% 30,041 PLDT (Philippines) 0% 30,613 Mobilink (Pakistan) 0% 36,810 BSNL (India) 0% 39,865 Vodafone (India) 0% 40,960 Reliance (India) 7% 47,890 Telkomsel (Indonesia) 79% 53,150 DoCoMo (Japan) 0% 55,163 Bharti (India) 0% 162,491 China Unicom 0% 369,339 China Mobile %BB  000s  Operator
    24. 24. Internet in Asia developing economies: Primarily wireless-Philippines example Source: Adapted from PLDT, Globe. <ul><li>domestic and international remittances </li></ul><ul><li>utility bills </li></ul><ul><li>insurance premiums </li></ul><ul><li>school tuition fees </li></ul><ul><li>micro tax payments </li></ul><ul><li>electronic loads and pins </li></ul><ul><li>online purchases </li></ul><ul><li>ferry, airline & train tickets </li></ul>
    25. 25. Broadband targets Broadband Zero in Japan: % HH India BB Policy: BB subscribers (m) Malaysia ICMS Goals: % BB HH Singapore iN2015: % BB HH
    26. 26. Broadband recommendations <ul><li>Encourage franchising </li></ul><ul><li>Certify Customer Premises Equipment & announce broadband plans to encourage manufacturing of CPEs </li></ul><ul><li>Expedite mechanism for spectrum </li></ul><ul><li>Streamlining and sharing Rights of Way </li></ul><ul><li>Encourage broadband via broadcast technology </li></ul><ul><li>Universal Service fund for providing broadband in underserved areas and to subsidize backhaul charges </li></ul><ul><li>Make Multiple Dwelling Unit buildings broadband ready </li></ul>Adapted from Telecom Regulatory Authority of India
    27. 27. Conclusions <ul><li>Big broadband divide in Asia region </li></ul><ul><li>Numerous barriers including income, geography, literacy, policy and competition </li></ul><ul><li>Competition: intra- and inter-modal and fixed broadband versus mobile broadband </li></ul><ul><li>Mobile and “Internet-like” use in developing countries </li></ul><ul><li>How much broadband is enough? </li></ul>
    28. 28. The End [email_address]