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Broadband Infrastructure in the ASEAN-9 Region

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Broadband Infrastructure in the ASEAN-9 Region BroadbandBroadband InfrastructureInfrastructure inin thethe ASEANASEAN‐‐99 RegionRegion Markets,Markets, Infrastructure,Infrastructure, MissingMissing Links,Links, andand PolicyPolicy OptionsOptions forfor EnhancingEnhancing CrossCross‐‐BorderBorder ConnectivityConnectivity Michael Ruddy Director of International Research Terabit Consulting www.terabitconsulting.com PartPart 1:1: BackgroundBackground andand MethodologyMethodology www.terabitconsulting.com ProjectProject ScopeScope Between late‐2012 and mid‐2013, Terabit Consulting performed a detailed analysis of broadband infrastructure and markets in the 9 largest member countries of ASEAN: – Cambodia – Indonesia – Lao PDR – Malaysia – Myanmar – Philippines – Singapore – Thailand – Vietnam www.terabitconsulting.com ScopeScope (cont(cont’’d.)d.) • The data and analysis for each country included: Telecommunications market overview and analysis of competitiveness Regulation and government intervention Fixed‐line telephony market Mobile telephony market Internet and broadband market Consumer broadband pricing Evaluation of domestic network connectivity International Internet bandwidth International capacity pricing Historical and forecasted total international bandwidth Evaluation of international network connectivity including terrestrial fiber, undersea fiber, and satellite Evaluation of trans‐border network development and identification of missing links www.terabitconsulting.com SourcesSources ofof DataData • Terabit Consulting has completed dozens of demand studies for submarine and terrestrial fiber networks worldwide – Constant contact with operators, ISPs, and other stakeholders • Terabit Consulting’s published reports include: – The Undersea Cable Report (1,500+ pages) – International Telecommunications Infrastructure Analysis (1,000+ pages) • Terabit Consulting’s data and intelligence regarding infrastructure, demand, traffic flows, pricing, and market share is unsurpassed www.terabitconsulting.com PartPart 2:2: StateState ofof thethe ASEANASEAN‐‐99 BandwidthBandwidth andand BroadbandBroadband MarketsMarkets www.terabitconsulting.com InternationalInternational InternetInternet Bandwidth,Bandwidth, YE12YE12 Myanmar: 14 Gbps Vietnam: 360 Gbps Laos: 2.5 Gbps Philippines: 560 Gbps Thailand: 463 Gbps Cambodia: 11 Gbps Malaysia: 400 Gbps Singapore: 1,389 Gbps Indonesia: 250 Gbps www.terabitconsulting.com IntInt ’’l.l. InternetInternet BandwidthBandwidth per per CapitaCapita (Kbps) 900 times difference between Myanmar and Singapore SERIOUS1 Kbps per OBSTACLE Capita or Less: TO DEVELOPMENT www.terabitconsulting.com InternationalInternational BandwidthBandwidth InfrastructureInfrastructure • Singapore: By far, the strongest in the region – 10 interregional submarine cables as of 2013 – 6 additional regional systems (Malaysia/Indonesia) – Additional fiber via Causeway and Second Link • Philippines and Malaysia: Strong – PLDT has 3 cable stations, Globe has 2, Pacnet has 2 – Malaysia served by FLAG, Sea‐Me‐We‐3, SAFE, Sea‐Me‐We‐ 4, APCN‐2, Asia Submarine‐Cable Express, AAG – Time dotCom shareholder in Unity transpacific cable • Thailand: Average – FLAG, Sea‐Me‐We‐3, Sea‐Me‐We‐4, AAG • Vietnam: Below average, but improving – Sea‐Me‐We‐3 was supplemented by TGN‐IA (2009) and AAG (2010) www.terabitconsulting.com InternationalInternational BandwidthBandwidth InfrastructureInfrastructure • Indonesia: Weak – Served by Sea‐Me‐We‐3 but most other infrastructure routes through Singapore • Myanmar: Weak – Served by Sea‐Me‐We‐3 – Planned Sea‐Me‐We‐4 link via Bangladesh and planned Sea‐ Me‐We‐5 • Cambodia and Lao PDR: Very Weak, with no direct interregional connectivity – Cambodian membership in AAG was too late, relies on Ezecom backhaul via Thailand and Vietnam – Lao PDR served exclusively by low‐capacity terrestrial trans‐ border links www.terabitconsulting.com InternationalInternational BandwidthBandwidth InfrastructureInfrastructure VN: BELOW AVERAGE MM: WEAK LA, KH: VERY WEAK PH: STRONG TH: AVERAGE MY: STRONG SG: VERY STRONG ID: WEAK www.terabitconsulting.com TheThe ImpactImpact ofof LowLow InternationalInternational BandwidthBandwidth && WeakWeak InternationalInternational InfrastructureInfrastructure • At the macro level: a major obstacle to economic and human development – Detachment from digital economy – Continued economic inefficiencies and restrained growth – Lack of access to critical social tools including telemedicine, distance learning, scientific/research nets • More specifically within the telecom environment: higher wholesale and consumer prices, and lower broadband adoption rates – Cambodia, Indonesia, Lao PDR, Myanmar, Philippines, Thailand, and Vietnam: $70 to $100 per Mbps wholesale • Compared to Singapore: $10 per Mbps www.terabitconsulting.com PricingPricing + ConsumerConsumer Subscription ImpactsImpacts Annual GDP ‐Capita Per ’’l.l. BandwidthBandwidthConnection: of IntInt a % as WeakWeak Broadband 1 Mbps Installation Higher Int’l. Bandwidth and/or Better Int’l. Infrastructure Yields Lower Consumer Broadband Prices www.terabitconsulting.com OverviewOverview ofof BroadbandBroadband StatusStatus Annual 1 Mbps GDP per Int’l. Fixed and Competitive‐ Broadband Capita, YE Band‐ Int’l. Domestic Mobile IP Transit ness of Subscription + 2012 width per Connect‐ Connect‐ Broad‐band Price Telecom Installation as % (PPP, Capita ivity ivity Infra‐ Market of Nominal GDP USD) (Kbps) structure per Capita Very Reasonably Cambodia $2,400 0.8 Weak Adequate Very Limited 48.7% Expensive Competitive Indonesia $4,900 1.0 Weak Adequate Expensive Competitive Growing 5.5% Very Less Lao PDR $2,900 0.4 Weak Limited Very Limited 27.4% Expensive Competitive Reasonably Reasonably Relatively Malaysia $16,400 15.6 Excellent Adequate 4.4% Priced Competitive Strong Uncompetitive Very Myanmar $1,900 0.3 Weak Limited but Planned Very Limited 132.8% Expensive Liberalization Relatively Very Less Philippines $4,300 5.5 Excellent Growing 11.2% Strong Expensive Competitive Reasonably Singapore $59,500 258.3 Excellent Very Strong Inexpensive Very Strong 0.1% Competitive Relatively Very Reasonably Thailand $9,240 6.6 Average Average 0.5% Strong Expensive Competitive Somewhat Less Vietnam $3,550 5.2 Limited Expensive Limited 7.9% Weak Competitive www.terabitconsulting.com PartPart 3:3: IdentificationIdentification ofof PriorityPriority CrossCross‐‐ BorderBorder TerrestrialTerrestrial LinksLinks www.terabitconsulting.com PriorityPriority TerrestrialTerrestrial FiberFiber LinksLinks High Priority Lao PDR to Yunnan Indonesia to/from Malaysia MediumMedium PriorityPriority Cambodia to Thailand Lao PDR to Cambodia Lao PDR to Myanmar Myanmar to Thailand Myanmar to Yunnan Vietnam to Yunnan www.terabitconsulting.com HighHigh‐‐PriorityPriority TerrestrialTerrestrial FiberFiber LinksLinks International Border Current Status Recommendation Lao PDR to Yunnan Province ETL operates a fiber link to Yunnan Province, The Lao PDR‐China route would benefit from China via Boten. greater competition. A new terrestrial fiber link between Indonesia and Malaysia would greatly improve the region’s Although undersea connectivity exists connectivity and is warranted by the countries’ between Indonesia and Malaysia, no direct linguistic, economic, and cultural ties. Such a Malaysia to Indonesia connectivity is present between the link would also improve connectivity to the countries’ states on the island of Borneo. Malaysian states of Sabah and Sarawak, which have traditionally relied upon transit capacity through Peninsular Malaysia. www.terabitconsulting.com MediumMedium‐‐PriorityPriority TerrestrialTerrestrial FiberFiber LinksLinks International Border Current Status Recommendation Because the development of submarine The route provides one of Cambodia’s primary connectivity to Cambodia is uncertain, the paths to international submarine connectivity country is strongly dependent on its terrestrial Cambodia to Thailand and has limited competition, with both links and consumer prices remain extremely Telecom Cambodia and Ezecom operating high, in part because of limited infrastructure infrastructure. competition. Existing fiber infrastructure is weak and Demand between the two countries is weak but capacity is controlled by Enterprise of transit traffic from Lao PDR via Cambodia could Lao PDR to Cambodia Telecommunications of Lao (ETL). There are increase if a new Cambodian submarine cable is no submarine cables in Cambodia but future constructed. projects are under consideration. Access to Myanmar’s Sea‐Me‐We‐3 landing point Demand between the two countries is weak Lao PDR to Myanmar could improve Lao PDR’s options for but Myanmar hosts the Sea‐Me‐We‐3 cable. connectivity. Additional Myanmar‐Thailand capacity should be As the Myanmar telecommunications market considered, especially in light of high consumer Myanmar to Thailand opens to competition, there will be increased broadband costs in Myanmar (132.8% of per‐ demand for additional international paths. capita GDP per Mbps). As the Myanmar telecommunications market Additional Myanmar‐China capacity should be Myanmar to Yunnan Province opens to competition, there will be increased seriously considered, but relations between the demand for additional international paths. two nations have weakened since 2011. The existing link is believed to follow the VNPT and China Telecom operate a link Youyiguan Pass; additional connectivity via Vietnam to Yunnan Province between Vietnam and China within the aegis Yunnan Province should be of the China‐Southeast Asia Cable. considered.
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