This market report provides a comprehensive overview of the broadband Internet segment of the telecom market across the various economies of Asia.
Asia makes a strong claim to be leading the world when it comes to the development of broadband Internet. In fact, after the mobile market, broadband has been the fastest growing telecom market segment in Asia. The energetic expansion of broadband, however, has remained more of a phenomenon limited to the developed economies, with narrowband dial-up access continuing to be the norm in most of the poorer developing countries of the region. Of course, this is starting to change, with a number of interesting examples breaking the trend, but for the moment, there remains a ‘digital gap’. In those economies where the broadband market is taking off, both DSL and cable modem platforms have both proved popular, but DSL has established a clear advantage. With DSL dominating the world market, Asia has become the leading region in the world for DSL, with about 38% of the global DSL subscribers. More recently, we have seen the advent of FttH as an alternative platform for broadband access in Asia. In the leading technology markets of Japan and South Korea, FttH has already started displacing other forms of high speed Internet access.
With broadband Internet continuing to take Asia by storm, the region’s broadband market finds itself dominated by six players. These ‘High’ ranked markets are predominantly the economies of North Asia. South Korea, Hong Kong, Singapore, Macau, Taiwan and Japan, for the moment at least, have left the rest of the region behind in terms of both penetration and sophistication of their broadband services and infrastructure.
And of these, South Korea is the most remarkable example of the Asian broadband revolution. With a broadband subscriber penetration of over 32%, close to 85% of households in the country have a high speed broadband Internet connection.
South Korea - broadband subscribers and households - June 2009
Total No. of subscribers 15,876,990
Annual growth 3.5%
Broadband (population) penetration 32.7%
Proportion of all Internet subscribers 98%
No. of residential broadband subscribers(e) 14,290,000
Proportion of all households 85%
(Source: BuddeComm based on industry data)
Although the regional broadband market is dominated by a relatively small number of countries in Asia Pacific, there continues to be considerable activity in the Internet and online markets across Asia. In terms of sheer broadband Internet numbers, China (over 90 million broadband subscribers) is already making its presence felt as a player, despite its relatively modest user penetration when measured against the leading markets.
Again, we see those economies that fall outside the top band of Asian Internet markets. In terms of broadband household penetration two distinct lower groupings appear. The countries in the second band - roughly between 5% and 20% household penetration - are found to be busily in expansion mode when it comes to their Internet market segments. But there is a clear gap - more than 30% on the household penetration scale - to be bridged before they claim a position in the top grouping. With Malaysia and Vietnam playing significant roles in this middle group, we typically find that in the last few years both operators and governments in these markets have started to give priority to expanding Internet access and speed. There are a few newcomers to this group, too, the standout one being Kazakhstan, where the broadband market has been growing at an annual rate in excess of 200%. Of course, as noted already we find China in this grouping as it battles to provide Internet access for its huge population.
In the third grouping - those markets with a user penetration 2% or less - we find those countries that, for whatever reason, have not yet ‘got their act together’ when it comes to Internet. Of course, some are performing relatively well under difficult circumstances. Indonesia has major infrastructure challenges to overcome in providing Internet to its citizens across a sprawling archipelago. India, like China, is struggling with its huge population and has focused on its mobile telephony services. At the bottom end of the scale, however, we find a number of countries that simply have to manage with poor telecom infrastructure and generally underdeveloped regulatory regimes.
Asia’s broadband - markets ranked by household penetration - June 2009
Market ranking Penetration range (as proportion of all households) Market (household penetration)
High >50% South Korea (85%) Singapore (82%) Hong Kong (80%) Macau (72%) Taiwan (64%) Japan (54%)
Medium 2-40% Malaysia (21%) China (20%) Brunei (18%) Maldives (15%) Kazakhstan (15%) Vietnam (12%) Philippines (10%) Thailand (8%) Georgia (4%)
Low 0-2% Azerbaijan (2%) India (2%) Indonesia (1%) + 18 other countries in Asia
(Source: BuddeComm, estimates)
Data in this report is the latest available at the time of preparation and may not be for the current year.