Archive for October, 2013

Singapore deal that could see SingTel gain control of OpenNet has market rivals ‘up in arms.’

Thursday, October 31st, 2013

Singapore has developed the status of a world leader in telecommunications through the building of a high quality and extremely progressive regulatory environment for the local telecommunications sector. This dynamic has, in turn, generated a highly competitive telecom market place in the island-state. The Infocomm Development Authority (IDA), the nation’s telecoms regulator, reports that Singapore’s fixed-line household penetration rate around 100%, many Singaporeans having two fixed telephone services at home. At the same time, its booming mobile market has a highly penetrated that is continuing to grow in subscribers and sophistication. Singapore’s 3G market segment has been on a growth surge over recent years but that is now easing with the advent of 4G. In the meantime 3G had become the ‘normal’ mobile service in the country with around two-thirds of the subscriber base being 3G.

As Singapore’s mobile market continues its expansion, the numbers of broadband access and data services are increasing at an impressive rate. The Residential Wired Broadband Household Penetration Rate, for example, had reached around 104%.

With strong leadership from its government and good support from its telecom service providers, Singapore is both a regional leader and a global player in telecommunications. The island-state certainly generates a positive outlook in its local telecommunications sector. The country has built what is widely seen as a high quality and extremely progressive telecommunications regulatory regime that has, in turn, resulted in a richly competitive market.

At the same time as building its sophisticated telecoms infrastructure, Singapore has successfully promoted itself an IT hub and a place of excellence when it comes to all things to do with IT and telecommunications. The nation is determined to maintain its status and in the process it has been embarking on new and innovative telecom and IT projects.

Although incumbent Singapore Telecommunications (SingTel) continues to play a major role in the local telecom sector, liberalisation has seen a significant number of new operators entering the market, helping to exploit the competitive situation. The arrival of strong competition in its own backyard saw SingTel expand offshore and, in what eventually turned out to be a successful strategy, the company has been able to establish a considerable presence in regional markets, including 100% ownership of Optus, the second ranked mobile operator in Australia. Its offshore presence includes subsidiaries in India, Indonesia, the Philippines, Thailand, Pakistan and Bangladesh. And through its alliance with Bharti Airtel in India it has further market presence in Bangladesh, Sri Lanka and Africa. The SingTel group had around 500 million mobile subscribers across its many markets.

With the government pushing to move Singapore into the forefront of IT development, the IDA announced back in 2008 that S$1 billion (US$725 million) had been allocated by the government to support the building and operating of a national optical fibre-based network as part of what was called the Next Generation National Infocomm Infrastructure (Next Gen NII); the strategy also included a wireless network. Despite some problems with the rate of roll out, the development of this national network has been proceeding.

NGNBN builder OpenNet reported on a plan to sell the company to CityNet, a subsidiary of SingTel. The deal required the approval of the regulator to proceed. In the meantime, rival companies in the market were reported to be unanimously opposing the plan and had requested the government to reject it on the grounds that it was anti-competitive. They claimed to be expressing the grave concerns within the industry about the proposed acquisition, suggesting that there was ‘the potential of discriminatory treatment and a lack of independence.’

For detailed information, table of contents and pricing see:

Singapore – Telecoms, Mobile, Broadband and Forecasts

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Gabon – 3G services expected by end-2013, HSPA mobile broadband on the horizon

Wednesday, October 30th, 2013

Gabon remains one of the wealthiest nations in Africa, with the economy largely buttressed by oil revenue. GDP per capita is well above the African average, although a distorted income distribution and poor social indicators are evident. GDP growth of over 6% annually is anticipated through to 2015 at least.

The telecom market was liberalised in 1999 when the government awarded three mobile telephony licences and two Internet Service Provider (ISP) licences and established an independent regulatory authority. Following two unsuccessful attempts, Gabon Telecom was privatised in 2007 when Vivendi-controlled Maroc Telecom bought a 51% stake in the operator.

With competition between three service providers – Zain (formerly Celtel, now Bharti Airtel), Gabon Telecom’s Libertis, and Etisalat’s Moov – Gabon became one of the first countries in Africa to exceed 100% mobile market penetration in 2008. Recently the regulator adjusted its recording of mobile penetration, based on a standard adopted by the French telecom regulator, to account for multiple SIM card use among subscribers. Network operators have been able to maintain higher Average Revenue Per User (ARPU) than their peers in the region.

The 2009 entry of a fourth network, USAN (operated by Bintel under the brand name Azur) into a saturated market triggered a price war that saw revenues and profits dive, forcing the operators to streamline their operations and to look for new income streams. Following more than a year of delays, a licence to offer 3G mobile broadband services was finally awarded in late 2011. Capacity on newly landed submarine cables was negotiated with Gabon Telecom to expedite the deployment of 3G services, which are not expected to be launched until the end of 2013.

In contrast with the mobile market, Gabon’s fixed-line and internet/broadband sectors have remained underdeveloped due to a lack of competition and the resulting high prices. The country has always had sufficient international bandwidth on the SAT-3/WASC/SAFE fibre-optic submarine cable which runs from Portugal via South Africa to the Far East, but this facility has been monopolised by Gabon Telecom. The recent arrival of a second international submarine fibre optic cable (ACE), combined with the anticipated launch of 3G mobile broadband services is expected to bring significant improvements to this sector in coming years.

For detailed information, table of contents and pricing see:

Gabon – Telecoms, Mobile and Broadband

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The hotly contested global TV and Video Media market

Wednesday, October 30th, 2013

The world of television has changed dramatically over the last few years with the biggest game changer being the Internet. The internet has completely changed the shape of the industry and the traditional broadcasters are certainly no longer in charge of the global viewing habits of consumers! With a choice of cable, satellite and free-to-air as well as online DVD rental, downloading, IPTV and instant streaming services; the consumer now has enormous control over when and how they watch movies and TV programs.

Recently the industry also saw the introduction of Smart TV and while BuddeComm are great believers in the potential of Smart TV; we don’t foresee that the revolution is going to come out of the current generation of this technology because many of the functions offered by Smart TVs are not even being used by the consumers yet.

Viewing quality is also a target area for TV manufacturers with the recent release of 4K TV and curved television sets. Industry predictions for 4K TV, also known as Ultra-HD TV are very positive and the release of cheaper versions are expected to drive the global uptake of these TVs – especially in established Asia-Pacific markets.

Other trends occurring in the TV sector sees the inevitable overtaking of physical DVDs by on-demand streaming and digital download. This will become the primary way in which households enjoy movies and TV and this will play out over the next decade as more and more consumers IP-enable their lounge rooms. Hollywood will also make more content available digitally, removing the earlier release window advantages that DVD still enjoys today. IPTV is expected to have a profound change on the face of TV delivery over the next years through to 2015.

Over-the-Top (OTT) content in particular will be a key to these changes, offering opportunities for advertising and content providers alike. In mid 2013 we saw the launch of Google’s Chromecast which is an exciting new development. The principle behind it is probably the magic formula that is needed to finally revolutionise television watching. If this device delivers what it promises, it will indeed totally change the broadcasting market. The sheer market power of this device is going to deliver a terrible blow to those in the industry which are hanging on to their old broadcasting models, with exclusive rights, premium services, walled gardens, proprietary devices and so on.

Many consumers now spend less time in front of the television set and significantly more time in front of digital devices – PCs, smartphones, tablets and gaming consoles. This shift in viewer habits is causing the TV and Video Media market to become one of the mostly hotly contested sectors right now – and indeed for the next few years to come.

BuddeComm’s new report, Global Digital Media – The Dynamic Digital, IPTV and Smart TV markets provides important insights into the vibrant global TV market which is undergoing significant transformation. This report includes key trends, statistics, case studies and analysis on the key sectors which comprise the TV market including Digital and Pay TV, Online video streaming, Mobile TV and IPTV. It explores the trends occurring in multi-play bundling supported by relevant case studies and a future based on Over-The-Top (OTT) services. In addition the report provides insightful regional overviews written by BuddeComm’s Senior Analysts for North America, Europe, Africa, Middle East, Latin America and Asia Pacific.

For detailed information, table of contents and pricing see:

Global Digital Media – The Dynamic Digital, IPTV and Smart TV Markets

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Namibia – Portugal Telecom’s merger with Brazil’s Oi to deliver benefits to MTC

Tuesday, October 29th, 2013

Namibia was one of the last countries in Africa to introduce competition in the mobile communications sector when a second network finally launched in 2007. Despite this, the country has achieved a market penetration rate well above the regional average. However, the average revenue per user has more than halved since then. Both GSM operators – MTC (managed by Portugal Telecom) and TN Mobile (formerly Cell One and Leo, now owned by Telecom Namibia) – have entered the internet and broadband market with 3G mobile broadband services in a bid to create new revenue streams. MTC introduced fourth generation (4G) technology in May 2012 when it launched an LTE network in the capital, Windhoek. In addition, Telecom Namibia (TN) offers 3G mobile broadband services using EV-DO technology, and in 2013 contracted ZTE to roll out a network to provide converged fixed and mobile services, including LTE.

Fixed-line services are still a monopoly of TN, but as a member of the WTO the government plans to open the telecom sector to full competition. TN entered the lucrative mobile market as the third player with a CDMA network but was put on hold by the industry regulator, the Namibian Communications Commission, until a new communications law was enacted which, among other issues, addresses fixed-mobile convergence. Since then, however, the absence of effective regulation during the transition to a new regulatory authority, the Communications Regulatory Authority of Namibia, has led to further delays in market liberalisation.

Despite being reasonably competitive with six ISPs, development of Namibia’s internet and broadband sector was long held back by high prices for international bandwidth, caused by the lack of a direct connection to international submarine fibre optic cables until 2011 when the WACS cable landed in the country. International cable services were launched in May 2012. In parallel, Namibia is working to diversify its transit access routes via neighbouring countries, but broadband price reductions on the retail level have remained moderate.

The country’s boom in broadband services has been helped by developments with 3G and 4G mobile services, as well as by investments in national fibre backbone infrastructure. Several WiMAX and other wireless broadband services offer additional access options and are standing by to bring additional competition to the voice market as well, once internet telephony is deregulated.

For detailed information, table of contents and pricing see:

Namibia – Telecoms, Mobile and Broadband

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Broadband Developments in Asia

Tuesday, October 29th, 2013

Asia continues to represent a massive presence in the global broadband market in terms of both fixed and mobile broadband services. The region in fact makes a strong claim to be leading the world in the development of broadband internet.

More a phenomenon in the developed economies of the region – South Korea, Japan, Singapore, Taiwan, Hong Kong – there has been a willingness to try new technologies early and, in doing so, to shape the way the broader market eventually adopts these technologies. And China with its huge population has also had a major impact on the region’s broadband market claiming a 43% household penetration coming into 2013. Asia has also shown the way with its application of FttX as an alternative platform for fixed broadband access. In the leading technology markets of Japan and South Korea, FttX now comprises over 50% of the high speed internet access connections, moving DSL aside in the process.

In the process of establishing its genuine status as a global leader, and on the back of its mobile and broadband market segments and their respective capabilities, Asian nations have been busy building a formidable alliance with the digital economy. Again, the developed markets of Asia have positioned themselves well to exploit mobile data and broadband wireless opportunities and are already leading the rest of the region in mobile applications. In the meantime, as service improves and as content providers offer more and more, exponential growth in data usage is occurring in the key markets of Asia.

Fixed broadband services in Asia continue to quietly underpin the broadband offerings across the region, providing online access for hundreds of millions of households and businesses. The major shift in fixed broadband in recent times has been to the region’s new and expanding fibre networks. The construction and commissioning of National Broadband Networks (NBNs) has already happened or is well advanced in the more developed markets. As a consequence of the early moves into this form of infrastructure, Asia can claim to be a global leader in the rollout of FttX with the region claiming around 80% of the world’s FttX subscribers coming into 2013.

Meanwhile, the fixed broadband market has a dominant presence in Singapore where an improbable household penetration of 104% was claimed in June 2013. Other strong markets in terms of household penetration include South Korea (96%) and Hong Kong (89%). Malaysia has made rapid progress in the last few years and reports 67% household penetration for broadband access.

The huge change in broadband access in Asia has been the advent of mobile broadband. On the back of more than a decade of strong growth in mobile markets, we have seen a strong transition to new generation mobile networks and services across the region. By end 2012 there were a total of 3.3 billion mobile subscribers and with annual growth running at around 10% the numbers were expected to hit 3.5 billion by end 2013. The key element within this massive array of networks and services in Asia is the increasing capability to efficiently manage data; this capacity is in turn matched by an enthusiasm in the various Asian telecom markets for adopting all that is on offer. The take up rate of mobile broadband has been increasing rapidly as regional networks are progressively upgraded to next generation platforms. Of course, all this is happening in line with the greater availability of smartphones, tablets and other similar devices.

Peter Evans

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