This report provides an overview of the trends and developments in the mobile, broadband and digital economy of the major markets of the Asian region. Subjects covered include:
Researchers:- Peter Evans, Paul Budde
Current publication date:- August 2012 (17th Edition)
Asia presents a massive presence in the global mobile and broadband markets. The region owns 49% of the world’s mobile subscribers. And when it comes to the development of broadband internet Asia makes a strong claim to be leading the world. On the back of the mobile and broadband market segments and their respective capabilities, Asian nations have been busy building a formidable alliance with the digital economy.
Following more than a decade of strong growth, mobile markets across Asia continued to expand during 2011 and into 2012. By end 2011 there were a total of 2.9 billion mobile subscribers in the region and with annual growth running at 10% the numbers were expected to hit 3.2 billion by end 2012. With some markets saturating and the impact of the shaky global economy still being felt, it is not surprising that the growth rate has slowed somewhat over the last year or so. This is after a period where annual mobile subscriber growth rates in Asia had been well in excess of 50%.
Overall regional penetration had reached an estimated 76% by mid 2012; although this figure is impressive in a region where the population was around 4.2 billion, it nevertheless suggests that there is still more room for subscriber growth across Asia. More than 18 countries in Asia had mobile penetration levels in excess of 100% going into 2012 and two (Macau and Hong Kong) had mobile penetrations in excess of 200%. Not surprisingly, the Global Financial Crisis caused some caution in mobile markets across the region for a year or two, but after a pause the momentum has quickly picked up again. The business emphasis has shifted from general subscriber growth to value added and mobile broadband.
Particularly relevant in the context of rapidly growing markets that still have some further room for expansion are India and China where monthly net additions have regularly been close to 10 million subscribers. These two countries combined account for around 60% of overall market share in the Asia-Pacific region. Led by China and India the region will continue to grow its mobile subscriber numbers on the back of other markets with large populations and relatively low penetration rates such as the Philippines, Pakistan and Indonesia.
In the developing economies, quick and easy mobile uptake has for a long time been the preferred, and often the only, option for subscribers, given the low levels of fixed-line deployments. In order to prevent ARPU slide in these markets, operators are offering value added mobile services such as mobile banking, remittance payments and mobile health services that take advantage of lack of access by the poor to social infrastructure such as banks and hospitals. As a consequence of these mobile-based services, the digital economy is alive and well in many of the emerging markets across Asia.
In the meantime, the developed markets in the region, such as Japan, South Korea, Hong Kong, Singapore and Taiwan, have positioned themselves well to exploit mobile data and broadband wireless opportunities and lead the rest of the region into the next generations of mobile applications. In fact, through the leadership of these markets Asia makes a strong claim to be setting the global benchmark when it comes to the development of mobile broadband internet access.
The rate of adoption of mobile broadband started increasing rapidly across Asia with the overall increase in mobile penetration combined with networks being progressively upgraded to next generation platforms. The initial wave of 3G services took a while before it saw any substantial growth in wireless data services across the wider regional markets; however, as 3G moves towards 4G and as speeds increase, as service improves and as content providers offer more. In South Asia, in particular, more people own a mobile phone than a PC, giving the delivery of mobile data services huge potential there.
By early 2012 Asia had a mobile broadband penetration of 11%; this represented 460 million mobile broadband subscribers in the region; two of Asia’s markets – South Korea and Singapore – had more mobile broadband subscribers than population by end 2011; Japan was not far behind on 90% mobile broadband penetration at the time.
The 3G licensing process and the progressive launch of 3G services in Asia is already well advanced. However, a few countries had been particularly slow in opening up their 3G markets. But by 2012 the last significant player to embrace 3G, the recalcitrant Thailand, was finally making substantial progress along this path.
For broadband internet generally – the combination of fixed and mobile - Asia makes a strong claim to be leading the world when it comes to its development. Broadband in its various forms has indeed been a fast growing segment in the Asian market. The energetic expansion of broadband has certainly been more of a phenomenon in the developed economies of the region, but most of the relatively poorer developing countries of the region are increasingly adopting broadband at a rapid rate. Te choice of technology platform varies across the region.
With DSL continuing to dominate the world’s fixed broadband market, Asia maintains its ranking as the leading DSL region with around 43% of the global DSL subscribers. In fact by end-2010 China claimed around an estimated 110 million of Asia’s 146 million DSL subscribers. In recent times, we have seen FttX as a growing alternative platform for broadband access in Asia. In the leading technology markets of Japan, South Korea and Taiwan, FttX has been displacing other forms of high speed internet access. DSL has dropped to just 20% of the broadband market in Japan. Asia, with 68 million fibre-based broadband connections by end 2011, accounted for around 80% of global subscriptions.
While there has been some activity in the providing of WiMAX networks, the real value of this platform is in its mobile form. Initial provisioning of mobile WiMAX in Asia has certainly commenced, but with a few exceptions the technology has not yet impacted on the mass market. In any event, in their various forms mobile wireless broadband systems are becoming a key feature of the broadband access landscape across Asia.
Over a number of decades the economies of Asia have progressively built substantial fixed-line national networks followed by national mobile networks. More recently the focus of infrastructure building has shifted to the upgrading of domestic telecom networks to Next Generation Networks (NGNs). This process has seen large scale investment by Asia’s leading telecoms markets in new-generation Internet Protocol (IP)-based telecommunications networks. The developed economies have each taken this a step further, rolling out a new fibre-based National Broadband Network (NBN) or its equivalent. Inevitably, those countries that have their government promoting the implementation of broadband strategies and backing new fibre-based roll-outs are the ones that are setting the pace. Even some of the lesser-developed markets are pushing hard on this front. Singapore and Malaysia provide two interesting case studies. In any event, those countries placing the emphasis on ensuring that the population has access to high speed broadband internet will be well prepared for the wider implementation of the digital economy.
Data in this report is the latest available at the time of preparation and may not be for the current year.
Number of pages 147
Last updated 29 Aug 2012
Analyst: Peter Evans
Paul, Many thanks for your inputs yesterday. You provided a compelling different perspective to our traditional infrastructure focus and this is valuable for our future planning. I also had very favourable feedback from our participants on your involvement.
Stephen Negus, Aurecon
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