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FttH Boom in North Asia

Paul Budde

In the mid-year 2008 rankings by the Fibre-to-the-Home (FttH) Council, South Korea, Hong Kong, Japan and Taiwan occupy the top four positions in terms of household penetration percentage. Asia Pacific now accounts for more than 27 million of the world’s 32 million FttH connections. South Korea has nearly 37% of its homes connected via fibre, with Hong Kong at 27%, Japan at 24% and Taiwan at 7.7%. While China ranked 11th in market penetration, its 7.5 million connections make it second only to Japan in the number of households with FttH. These figures are strongly related to overall broadband penetration with South Korea at 93% broadband penetration of households, Hong Kong 76%, Japan at 54% and Taiwan at 59% by end 2007. The household penetration is expected to further increase by 2012 to 97% in South Korea, 81% in Hong Kong, 77% in Japan and 74% in Taiwan.

The total broadband revenues in Asia Pacific stood at US$28 billion in 2007, and is projected to rise to US$42 billion by 2013. Korea Telecom has reached the 1 million mark for FttH subscribers and Chunghwa Telecom in Taiwan has 731,000 FttB subscribers. KDDI has 916,000 FttH subscribers and expects this to grow to 1.14 million by March 2009. Japan has more than 10 million FttH subscribers altogether. A new Japanese fibre deployer, Suo Cable Net, will be the first in Japan to deploy GPON commercially. Most Japanese companies are using GePON technology, which has only half the speed of GPON.

Despite being in a comparatively enviable position, The Korea Communications Commission (KCC), plans to spend around KRW34 trillion (US$24.6 billion) on improving the nation’s broadband infrastructure. The KCC aims to increase speeds for fixed line broadband services to 1Gb/s by 2012, with wireless services expected to offer speeds of 10Mb/s by the same date. The highest level speeds are only expected to be available in the country’s larger cities however, with fixed line subscribers in smaller towns having access at speeds between 50Mb/s and 100Mb/s by 2012.

Consumers in heavily penetrated markets are already addicted to broadband, therefore the future of these markets is less concerned with increasing subscriber numbers, and more with addressing new applications and content. The drivers are more for home entertainment (such as Internet video content and games), IPTV and home networking. As fixed-line substitution and voice migration to mobile continues, broadband value-added services become critical drivers for fixed-line service providers. Operators are aggressively promoting bundled and discounted price plans, encouraging migration from narrowband, introducing local content and improving service levels and affordability.

By Paul Budde, Managing Director of Paul Budde Communication. Paul is also a contributor of the Paul Budde Communication blog located here.

Related topics: Broadband, IPTV, Mobile Internet, Telecom, Wireless


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