KUALA LUMPUR, MALAYSIA: Asia-Pacific’s fixed broadband subscribers are likely to grow 17.3 percent to reach 182 million users by the end of 2009, clocking estimated billings of $44.9 billion, a rise of 13.3 percent over 2008.
Even as mobile broadband grows in tandem, Frost & Sullivan industry analyst Adeel Najam expects fixed broadband uptake to continue. He attributes this to the various government initiatives in rolling-out their national broadband ambitions such as Malaysia’s high-speed broadband (HSBB) project, Australia’s national broadband network (NBN) and Singapore’s iN2015 masterplan. He also expects telcos in developing markets to continue deploying basic xDSL (digital subscriber line) infrastructure.
By next year when most of the government-initiated projects are earmarked for full-scale roll-out, broadband users in Asia-Pac are expected to breach the 200-million-mark closing the year 2010 at 212.6 million.
New analysis from Frost & Sullivan, Asia-Pacific Fixed Broadband Market, finds that the broadband subscriber base in the region -- covering 14 Asia-Pac countries including Japan -- will grow at a CAGR of 14.1 percent annually (2009-2014) to reach 342.9 million subscribers by end-2014.
The same year, the region’s household broadband penetration would have risen to 37.2 percent, from only about 18 percent last year, with revenues estimated at close to $69 billion.
“The bulk of bandwidth growth and network roll-outs in the next few years will be driven by fibre-to-the-node deployments aided mainly by government spending on national high-speed broadband projects,” Najam says, adding that xDSL will however remain the dominant platform in developing markets.
According to Najam, “Consumer appetite for broadband will be spurred by the demand for high throughput value-added services such as IPTV and video-on-demand.”
He adds that services such as Web 2.0, social networking, file-sharing, online gaming, as well as falling PC prices and availability of low-cost netbooks have also added impetus towards broadband consumption.
In 2008, the top six Asia-Pac countries with the highest household broadband penetration rates were South Korea -- said to be one of the highest in the world -- at 92.8 percent, Hong Kong -- 85 percent, Singapore -- 78.5 percent, Taiwan -- 66 percent, Australia -- 63.7 percent, and Japan -- 62.7 percent.
The remaining eight markets have household broadband penetration rates of less than 60 percent.
By number of subscribers, in 2008 China had the most fixed broadband users with 83.4 million (53.8 percent of the region’s total subscriber base), followed by Japan with 30 million and South Korea with 15.5 million.
Looking forward, Najam dispels the threat of mobile broadband to fixed broadband services. He believes that both these access services need to co-exist, “In the age of convergence and multi-play services, both wireless and wireline broadband should be viewed as complementing technology to offer subscribers with blended services.
“While mobile broadband has significantly lower throughput than fixed access, it provides residential users with the convenience of ‘on-the-go’connectivity,” he adds.
Showing posts with label NBN. Show all posts
Showing posts with label NBN. Show all posts
Thursday, August 13, 2009
Thursday, July 9, 2009
Diverging incentives emerge in Australia's NBN
David Kennedy, Research Director at Ovum
AUSTRALIA: The Australian government announced in April 2009 that it was abandoning its tender for the construction of an FTTN network, and would instead pursue an FTTH access network to reach 90 percent of the market within eight years.
The accompanying discussion paper sought recommendations for regulatory change both in the short term and in the long term. After the publication of the submissions on 12 June, the expectation was that the government would digest the submissions and develop draft policy proposals.
In fact, the relevant Minister issued a press release last Friday 3 July, seeking industry input on several specific issues related to the NBN:
* The optimal access regime for the NBN, including, for example, the legislative obligations that should be required to ensure the NBN company operates on a wholesale-only, open-access basis; the process for identifying services to be offered; how the prices and non-price terms and conditions of those services should be set, and for how long; and the role of the Australian Competition and Consumer Commission.
* The appropriate equivalence obligation for the company and the services it offers, and how this would operate in practice.
* The nature of ownership restrictions applied to private-sector investors to protect the government’s equivalence objective for the wholesale-only network.
* Arrangements for the government to sell its stake in the network in the future.
* Any other rights and obligations to be conferred on the company.
These are all very good questions, but why are they being asked now, and in this manner?
Diverging incentives
When the industry submissions were released on 12 June, it became apparent that most industry operators, particularly Telstra’s competitors, were focused on the short-term structural separation of Telstra’s copper access network. In contrast, scant attention was paid to the regulatory requirements for an NBN. This is why the government has been forced to seek further input.
We believe that this reflects a gap between the industry and the government. While the government is committed to the long-term goal of building an FTTH access network in Australia, Telstra’s competitors have far more interest in the regulation of the existing copper access network than in an FTTH network that will take years to build.
So far, this is mere short-termism and therefore unsurprising. However, there are deeper forces at work that are setting the government and Telstra’s competitors more seriously at odds.
Telstra’s competitors are currently abandoning DSL resale and are generating good operating margins on their installed DSLAMs. The NBN threatens this arrangement because it will ultimately force them off regulated ULLS into the uncertainty of a wholesale fibre network, where wholesale pricing and their ability to differentiate may be less favourable.
We think these fears are well-founded, because the NBN will be far more viable if ULLS is actually cut off as FTTH is rolled out, avoiding revenue fragmentation and reducing the need for government subsidy of the NBN.
There is also a real prospect that the current de-averaged prices for ULLS access, with lower prices in the cities, will give way to uniform national wholesale pricing and push up access seekers’ costs in their key markets.
Transition management will be key
This problem underlines how tricky the transition from copper to NGN will be. In fact, the policy challenge can be summed up as a complex process of transition management.
The apparently minor incident of a press release points to the more substantial reality: that the government, Telstra’s competitors and Telstra itself do not have the same incentives in this process. As a result, the Minister cannot assume that he will have the automatic support of either side of the industry for the government’s NBN objectives.
AUSTRALIA: The Australian government announced in April 2009 that it was abandoning its tender for the construction of an FTTN network, and would instead pursue an FTTH access network to reach 90 percent of the market within eight years.
The accompanying discussion paper sought recommendations for regulatory change both in the short term and in the long term. After the publication of the submissions on 12 June, the expectation was that the government would digest the submissions and develop draft policy proposals.
In fact, the relevant Minister issued a press release last Friday 3 July, seeking industry input on several specific issues related to the NBN:
* The optimal access regime for the NBN, including, for example, the legislative obligations that should be required to ensure the NBN company operates on a wholesale-only, open-access basis; the process for identifying services to be offered; how the prices and non-price terms and conditions of those services should be set, and for how long; and the role of the Australian Competition and Consumer Commission.
* The appropriate equivalence obligation for the company and the services it offers, and how this would operate in practice.
* The nature of ownership restrictions applied to private-sector investors to protect the government’s equivalence objective for the wholesale-only network.
* Arrangements for the government to sell its stake in the network in the future.
* Any other rights and obligations to be conferred on the company.
These are all very good questions, but why are they being asked now, and in this manner?
Diverging incentives
When the industry submissions were released on 12 June, it became apparent that most industry operators, particularly Telstra’s competitors, were focused on the short-term structural separation of Telstra’s copper access network. In contrast, scant attention was paid to the regulatory requirements for an NBN. This is why the government has been forced to seek further input.
We believe that this reflects a gap between the industry and the government. While the government is committed to the long-term goal of building an FTTH access network in Australia, Telstra’s competitors have far more interest in the regulation of the existing copper access network than in an FTTH network that will take years to build.
So far, this is mere short-termism and therefore unsurprising. However, there are deeper forces at work that are setting the government and Telstra’s competitors more seriously at odds.
Telstra’s competitors are currently abandoning DSL resale and are generating good operating margins on their installed DSLAMs. The NBN threatens this arrangement because it will ultimately force them off regulated ULLS into the uncertainty of a wholesale fibre network, where wholesale pricing and their ability to differentiate may be less favourable.
We think these fears are well-founded, because the NBN will be far more viable if ULLS is actually cut off as FTTH is rolled out, avoiding revenue fragmentation and reducing the need for government subsidy of the NBN.
There is also a real prospect that the current de-averaged prices for ULLS access, with lower prices in the cities, will give way to uniform national wholesale pricing and push up access seekers’ costs in their key markets.
Transition management will be key
This problem underlines how tricky the transition from copper to NGN will be. In fact, the policy challenge can be summed up as a complex process of transition management.
The apparently minor incident of a press release points to the more substantial reality: that the government, Telstra’s competitors and Telstra itself do not have the same incentives in this process. As a result, the Minister cannot assume that he will have the automatic support of either side of the industry for the government’s NBN objectives.
Subscribe to:
Posts (Atom)
