India, China fuel telecom growth in APAC region

By Staff
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Google Oneindia News

New Delhi, Feb 28 (UNI) With the mobile operators in India and China moving into the untapped rural areas to take advantage of the low penetration rates, the telecom services market in the Asia-Pacific (APAC) region is estimated to reach 298.2 billion dollars by end-2012.

The APAC telecom services market -- covering 12 major economies ex-Japan -- which includes fixed, mobile, internet and data communications services, earned revenues of 181.4 billion dollars in 2006, an analysis from global growth consulting company, Frost&Sullivan (F&S) has revealed.

Fixed telephony subscribers in Asia-Pacific totaled 402.2 million in 2006, and is forecasted to grow at a CAGR (compound annual growth rate) of 2.7 per cent from 2006 to 2012, driven mainly by the subscriber growth in India and China.

''While the number of fixed-line subscribers are already on a steady decline in most Asia-Pacific countries, markets such as China, India, Indonesia and Thailand, which have large populations and low household penetration rates, continue to experience growing subscriptions,'' says F&S research analyst Karpagam Palaniappan.

Mobile services accounted for the bulk of telecom revenues in 2006 at 61.3 per cent, while fixed, internet and data communications services accounted for 25.4, 8.9 and 4.4 per cent, respectively.

''Mobile operators in China, India and emerging markets such as Indonesia and the Philippines are now moving into the untapped rural areas to take advantage of the low penetration rates and sustain growth,'' according to the F&S study.

APAC has remained one of the few surviving high-growth mobile markets at a time when the cellular industry is fast approaching saturation globally.

In 2006, the cellular subscriber base was 819.5 million (ex-Japan) and is forecasted to reach 1.68 billion by end-2012, at a CAGR of 10.8 per cent (2006-2012), the study 'Benchmarking of Service Providers in Asia Pacific' says.

Nevertheless, the telecom industry in APAC region is challenged by deregulation, economic conditions, inadequate awareness of emerging technologies, low household penetration levels, and service quality issues.

This negatively impacts both consumers and service providers.

''A case in point is the huge success of IP telephony globally and its relatively low impact in Asia-Pacific due to regulatory uncertainty, lack of bandwidth, interconnection, and quality of service issues,'' Mr Palaniappan says.

''Similarly, technologies such as 3G, WiMAX and FTTx (fiber-to-the-exchange), which are rapidly gaining popularity worldwide, are only just emerging in Asia.'' Intense competition and market consolidation coupled with innovations and investments in emerging technologies, as well as improving the quality of customer service are likely to be the key factors shaping the growth of the telecom industry.

The study includes research on countries such as Australia, New Zealand, China, India, Thailand, Hong Kong, Taiwan, South Korea, Singapore, Malaysia, the Philippines, and Indonesia.

UNI

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