Asia driving growth for telecom industry

Move aside North America and Europe. Asia is now the world's largest telecommunication market and leads the world in the deployment of advanced telecommunication technology, according to the ITU's (International Telecommunications Union's ) Asia-Pacific Telecommunication Indicators 2002 report released Monday.

The release of the report, which examines the current state of the Asian telecommunication market and looks at future development trends in the region, was timed to coincide with the opening day of the ITU's Telecom Asia 2002 conference and exhibition, which is being held here at the Hong Kong Convention and Exhibition Center.

Most notable among the report's findings is that Asia, which is the world's most populous continent, in 2001 surpassed the Americas, including North and South America, and Europe in terms of the total number of telecommunication subscribers and was the only region to show significant subscriber growth in recent years.

Riding rapid subscriber growth in China, Asia is now home to 36 percent of the world's telecommunication subscribers, ahead of Europe at 35 percent and the Americas at 27 percent, the report said. Africa and the Middle East lagged far behind at 2 percent. By comparison, Asia represented 29 percent of the world's telecommunication subscribers in 1996, behind Europe (36 percent) and the Americas (33 percent). Africa and the Middle East accounted for 2 percent of all subscribers.

Better yet for the region, the lead is forecast to keep on growing, the report's authors said at Telecom Asia 2002 on Monday.

"If we take a relatively conservative assumption and say the developing countries grow at just 12 percent per year for the decade, then we would add another 800 million subscribers by 2010 in addition to those already added in the first two years of the decade," said Tim Kelly, head of the ITU's strategy and policy unit and one of the authors of the study.

"So, even with the most conservative of assumptions, you already have 1 billion new subscribers in the region by the end of the decade and that is a huge opportunity."

Asia's rise as the world's largest telecommunication market may seem inevitable given its large population but the report noted that the rapid rise of subscribers in the region was remarkable. While increases in teledensity in many Asian countries, such as China, Thailand and the Philippines, among others, represented the bulk of subscriber growth in recent years, more developed nations also played an important role, the report said.

Over the last 10 years, South Korea, Singapore, and Taiwan have added a total of 68 million new telephone subscribers, accounting for 10 percent of the regional total, the report said. Taiwan also leads Asia in the penetration of mobile phones, with a penetration rate of 96.6 percent for mobile phones and the country now has more than 100 cellular subscriptions per 100 people, indicating that many Taiwanese have more than one mobile phone subscription, it said.

Despite having crossed what many observers consider the saturation rate, Taiwan's growing mobile services market shows no signs of slowing down, the report said.

Alongside rapid subscriber growth, Asian countries are also leading the world when it comes to deploying new technologies.

Asia is now home to 33 percent of the world's Internet users, 47 percent of its ADSL (asymmetric digital subscriber line) users and 95 percent of the world's 3G (third-generation) mobile subscribers, said Yoshio Utsumi, secretary-general of the ITU, in a keynote speech here.

South Korea leads Asia and the world when it comes to the roll-out of broadband Internet services, with 58 percent of households having a broadband Internet connection in 2002, and five of the world's top 12 broadband economies are in the region, the ITU report said. Indeed, South Korea is making good use of all this connectivity and Koreans spend more time online than citizens of any other country, it said.

"One area where Asia-Pacific is clearly leading the world is in the use of broadband networks," said Kelly. "The Koreans are some of the most intensive users in the world. The average is 19 hours per month and that means that there are many Koreans using a lot more than that."

Kelly attributed the high level of use within Asia to low prices. "If you look at the price per megabit, then Korea, Japan and Hong Kong are much less expensive than the U.K., Germany and France. That's why we found the Asian economies are leading the world in broadband."

The report also contains good news for the least developed nations in the region, where the biggest impact of mobile telecommunication is being seen.

The rapid growth of cellular services has propelled Cambodia to be the global leader in terms of fixed line versus mobile. Cambodia in 1993 became the first nation in the world where the total number of mobile subscribers exceeded that of fixed line, said Michael Mingues, head of the ITU's telecommunication data and statistics unit and one of the report's other authors.

"Overall, the digital divide is narrowing," said Kelly. "We are seeing countries like China and Thailand catching up with the rest of the region so the overall picture is good."

However, Kelly noted that both rich and poor nations are now in danger of seeing a domestic digital divide. "Where the digital divide is widening is between urban and rural areas. It's much harder to install [broadband] services in rural areas."

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