MANILA – Basic DSL-based services will continue to drive the bulk of broadband deployments in developing markets in Asia Pacific, but is expected to face some competition from the various forms of wireless broadband technologies, said research and consulting firm Frost & Sullivan.
The firm said broadband subscriptions in the region will cross 171 million by the end of 2008.
The expected growth represents a year-on-year growth of 31.5% and a household broadband penetration rate of only 19.7% across all the countries in the region.
Of the 13 Asia Pacific countries Frost & Sullivan surveyed, Philippines ranked 11th with a household penetration rate of 3.57% in 2007. The number of subscribers in the country is expected to reach close to one million at the end of this year, for a year-on-year growth of about 46%. Frost & Sullivan expects the broadband subscriber base in the country to grow at a CAGR (compound annual growth rate) of 19% from 2008 to 2013.
The top five Asia-Pacific countries with the highest household broadband penetration rates in 2007 are South Korea (90.8%), Hong Kong (83.8%), Taiwan (76.8%), Singapore (73.1%), and Australia (63.2%). Japan has a 57.8% penetration rate, while the remaining seven markets have household broadband penetration rates of less than 50%. India and Indonesia registered the lowest penetration rates at 1.4% and 0.57%, respectively.
Frost & Sullivan said that the surge in demand for broadband in Asia Pacific is driven by the growing popularity of video-on-demand, multi-player online games, video content sharing and social networking services such as YouTube and Facebook, as well as the aggressive push by operators to offer innovative bundled triple- and quadruple-play services.
“As fixed-line substitution and voice migration to mobile continues, broadband value-added services (VAS) become critical drivers for fixed-line service providers,” notes Frost & Sullivan senior industry analyst Yong Lih Khoo.
“Operators are as such aggressively promoting attractive bundled and discounted price plans, encouraging migration from narrowband, introducing local content and innovative services such as IPTV, as well as overall improving service levels and affordability,” he adds.
New analysis from the company’s Asia Pacific Broadband Access Technology and Market Comparison, reveals that the broadband subscriber base in the region–covering 13 Asia-Pacific countries–reached 129.7 million in 2007 and estimates this to reach 321.8 million by end-2013, at a CAGR (compound annual growth rate) of 19.9 per cent (2008-2013).
The total broadband revenues in Asia-Pacific stood at US$28.1 billion in 2007. This is projected to reach a market size of $42 billion by end of 2013, growing at CAGR of 7.1 per cent (2008-2013).
Total number of broadband subscribers grew 19.2 per cent in 2007 and household penetration rate stood at 15.2 per cent. By 2013, the household broadband penetration rate is forecasted to hit 33.7 per cent.
The various government nationwide broadband master plan initiatives, particularly in the more developed nations, are also providing the impetus for the deployment of wider network infrastructure and coverage, and the development of local broadband content and applications, thus driving broadband uptake.
In terms of broadband access technology, Khoo believes that a wide range of access technologies–FTTH (fibre-to-the-home), FTTN (fibre-to-the-node), FTTB (fibre-to-the-building), DSL (digital subscriber line), WiMAX and other wireless technologies–would continue to coexist depending on the strategic outlook of the operators, existing infrastructure and price points in a given country.
“FTTx in its various forms–FTTH, FTTB, FTTN–would play a significant role in the next three to four years due to its potential of providing greater bandwidth to the premise, compared to copper wires,” said Khoo, adding that some countries like Hong Kong are already providing speeds up to 1Gbps, while other countries like Singapore are following suit.
Khoo said that deploying fibre as close to the home as possible enables operators to be future-ready for the bandwidth explosion that new services like multi-screen IPTV with recording and the concurrent high speed Internet needs.
“Although service providers are rolling-out FTTx, the profitability of new services like IPTV remains questionable as these deployments would typically have a long payback period,” Khoo said, adding that in a credit crunch environment, most operators are likely to be cautious before deploying full-fledged FTTH although it is a future-proof technology. He noted that FTTN would still be a more preferred option for low- to medium-density geographies like Australia and Malaysia.
