2010 Asian - Fixed Voice Market

Publication Overview

This market report looks at the fixed-line market in Asia and provides an overview of some of the main players in that segment of the market within the various economies of Asia.

Researcher:- Lisa Hulme-Jones, Peter Evans

Current publication date:- January 2010 (15^th Edition)

Next publication date:- December 2010

Executive Summary

While growth in the fixed-line market has flattened out and in some markets the numbers are declining, activity in this market continues to be overshadowed by frenzied activity in the booming mobile market. Nevertheless fixed infrastructure remains an important component in the overall development of the telecom sector.

As Asia entered 2009 it had close to 2.3 billion telephone services; of these services 575 million were fixed and almost 1.7 billion were mobile services. By end-2009 it was expected that total telephone services would be around 2.7 billion; but the total fixed numbers will contract again and be around 560 million by year end.

The standout market in terms of fixed-line subscribers has been China. Despite declining from 365 million subscribers by end 2007 to an estimated 325 million by end 2009, the country still represents almost 60% of the total regional subscriber base. As shown in the Table below, China is well ahead of the rest of the market in this respect. It is interesting to note that a number of the highly sophisticated telecom markets in Asia are also highly penetrated fixed-line markets; leaders in this regard are Taiwan (62% teledensity), Hong Kong (59%) and South Korea (44%). These are followed by Singapore (40%) and Japan (38%). As Singapore had only around 1.8 million fixed-line subscribers in 2009 it did not qualify to be included in the Table below. Nevertheless it remained a significant fixed-line market with its 40% penetration.

Of the 35 or so countries in Asia, the top 10 that are listed in the Table below claimed about 90% of the region’s fixed-line services by 2009.

As with other segments of the telecom market in Asia, we note the ever-present gap between the developed and developing economies of the region. In the developing economies, the building of essential fixed-line infrastructure has been largely ignored in favour of rolling out mobile networks as a quick way of providing telephone services to the population. In developing countries where governments have tried to force the pace of fixed-line roll-outs, the success rate has been mixed. In the Philippines and Indonesia these programs have been conspicuously ineffective; however, in a market like Vietnam, significant progress has been made, lifting that country up to become one of the more highly-penetrated fixed-line markets in the region at 34% teledensity. We have also seen a successful push in Indonesia to expand the fixed network; subscriber growth of 70% occurred in 2008 and was continuing in 2009 on the back of widespread deployment of WLL technology.

The other characteristic of the fixed line markets in Asia as we have already noted is that growth has flattened out and in some markets gone into serious decline. The estimated subscriber base for Asia’s top 10 markets at the end of 2009; many of the listed markets are clearly revealing a downward trend as seen in the Table. The two exceptions in this group of countries are Indonesia and Vietnam.

Asia – Top 10 fixed-line markets (ranked by subscribers) – 2007 - 2008

(Source: BuddeComm based on ITU and industry data)

Note: ¹Hong Kong and the Philippines equal 10th in 2008.

Asia – Top 10 fixed-line markets (ranked by subscribers) – 2009

(Source: BuddeComm based on ITU and industry data)

Note: ¹Estimates.

Apart from the voice services supported by the fixed-line infrastructure in the markets of Asia, the bonus of a healthy and extensive fixed network has been its ability to support DSL-based broadband access. This has seen DSL become the most popular platform for broadband access in Asia. This aspect of the market is addressed more extensively our other BuddeComm publication: Asian Broadband Market.

Data in this report is the latest available at the time of preparation and may not be for the current year.