Global Trends in Broadband

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Global Trends in Broadband
Eric LieRegulatory Reform UnitTelecommunication
Development BureauITU Asia Pacific Forum on
Telecommunications Policy and RegulationMay
17-20 2004Brunei Darussalam
The views expressed in this paper are those of
the author and do not necessarily reflect the
opinions of the ITU or its Membership
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How do we define broadband?

• Fast connection to the Internet
• Minimum of 256 kbit/s connection, although ITU-T
  recommendation I-113 proposes a minimum 1.5
  Mbit/s
• Always-on connection
• In some economies there are limits on the number
  of hours a user can be connected per month (e.g.
  Lithuania, Hong Kong Macao, China)
• Flat-rate billing
• Flat rate is the standard but some economies have
  started billing by the minute (e.g. Italy)
• Unlimited data usage
• Some ISPs place download limits on users (e.g.
  Australia, Belgium, Bosnia, Iceland, Kyrgyzstan)
  

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Broadband facts

• 63 million subscribers worldwide (1 of the
  world) in over 80 countries (31 Dec 2002)
• 94 of subscribers are in high-income economies
• Speeds vary from 0.256 Mbit/s to 100 Mbit/s
• Nearly 60 of broadband is delivered over
  telephone networks, 40 over cable

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Broadband networks
While most current broadband networks are based
on copper lines, fibre optic and wireless
technologies are the broadband of the future

• Phone lines
• Coaxial cables
• Fibre optic cables
• Power lines
• Wireless

Source ITU World Telecommunication Indicators
Database
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Broadbands fast growth
Broadband access has quietly grown faster than
mobile phones in their early stages
Source ITU World Telecommunication Indicators
Database
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Leading broadband economies
Source ITU World Telecommunication Indicators
Database
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Asias early broadband dominanceBroadband
subscribers, end 2002
Source ITU World Telecom Indicators Database.
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Recent Asian broadband growth
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Broadband success factors

• Urban demographics
• High urban population living in multi-level
  dwellings
• High ICT usage
• High PC and Internet penetration
• Price
• Affordable, simple and transparent
• Speed
• Speeds supporting a wide range of applications
  and that heighten the consumer experience
• Policy facilitation
• Enabling regulations

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Broadband prices
Overall subscription charges are important
But factoring in the speed of the connection and
income is the more telling story
Source ITU research
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Relative broadband speeds
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Policy enablers

• Formulating National, Regional and Local
  programmes
• Broadband promotion campaigns and educational
  programme
• Creating National Backbone infrastructure
• Establishing an Internet Exchange in the country
• Permitting Unlimited Competition for Broadband
• Encouraging International players to setup
  Gateways in the country
• Funding community investment in Broadband in
  uneconomic remote rural areas
• Leveraging government demand and setting example
  by being on-line leader
• Extending special tax concessions for equipments
  access devices used for Broadband.

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Enabling regulation

• Promoting facility-based competition by lowering
  market entry barriers
• Ensuring sufficient spectrum for wireless
  broadband services
• Simplifying procedures for Rights of Ways (ROW)
• Permitting infrastructure sharing among different
  service providers for optimum utilization and
  cost reduction
• Allowing the captive infrastructure of utility
  companies to be used for public Broadband service
• Reducing the bottleneck in last-mile access by
  promoting deployment of alternative technologies
  like Cable TV network, Wireless, Power Line, etc
• Unbundling of local loop for DSL-based services
  and facilitating co-location of ISPs Access Node
  at the Access Providers premises
• Reducing the cost of bandwidth for international
  Internet connectivity

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Asian competition
Broadband in Korea and Japan is the worlds
fastest as well as the worlds least expensive

• Korea
• Competitive ADSL provider (Hanaro) provides true
  facilities-based competition to the incumbent
  (KT). Other BB providers also have a strong
  presence and wide coverage in the market.
• Same-day ADSL hookup
• Japan
• Lowest loop access charges in the world
• Line sharing (copper) (US 1.40)
• Fibre to the home (US 43.33)
• 47 ADSL providers in June 2002

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The evolution of the Asian broadband market

• As economies near saturation levels
• Bundled services will become more important (e.g.
  VoIP offerings like Japans YahooBB Phone)
• Firms will compete on customer service, with less
  emphasis on speed (e.g. Koreas Hanaro Telecom PC
  Doctor service)

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Asian contrasts

• Asia leading the world
• Korea Hong Kong, China Worlds highest
  penetration
• Japan Worlds fastest ADSL speeds and the least
  expensive
• Some other parts of Asia/Pacific are struggling
  from lack of fixed-line infrastructure
• Correlation of 0.75 between fixed line
  penetration and broadband penetration (2002)
• Fixed lines
• Cambodia (0.25 per 100 inhabitants)
• Indonesia (3.66 per 100 inhabitants)
• India (3.98 per 100 inhabitants)
• Philippines (4.17 per 100 inhabitants)

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Low fixed-line penetration
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Broadband The digital divide again?
Even though 94 of all broadband subscribers are
in high-income economies, there are technologies
and policies well adapted to bridging the digital
divide in rural and developing areas.

• Demand aggregation
• Community based projects
• Governments as anchor tenants
• Use of wireless technologies to bridge the last
  mile

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Creative enterprise models
New and creative enterprises can make rural and
low income ICT projects profitable, affordable
and sustainable
A village community tele-kiosk in Padinetakudi
village. The kiosk operator, a young entrepreneur
in the village, points at the computer screen.
(Photo David de Souza)
A Hand-held Appliance
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Wireless can fill the gap
One wireless technology to reach remote areas,
another to share the connection once its there
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Broadbands likely path
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Broadband mobiles

• Broadband-type data rates will appear on mobile
  phones both in developed and developing broadband
  economies

• High penetration Move towards a ubiquitous
  computing experience
• Low penetration Mobile phones may offer the
  fastest and most cost effective way to bring
  Internet access to users

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Conclusion

• Asian economies are leading the world in
  broadband but many parts of Asia/Pacific have low
  penetration rates
• The lack of effective competition and high prices
  are the main stumbling block for users in many
  economies
• Wireless technologies will play a key role in
  boosting penetration rates in both developed and
  developing broadband economies
• Voice over broadband and other new services will
  ultimately help increase penetration levels and
  raise revenues

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TerimaKasih
Eric Lie eric.lie_at_itu.int
http//www.itu.int/ITU-D/treg/ http//www.itu.int/
birthofbroadband