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Asia’s Biggest Growth is yet to come
Telecommunication Epicentre Shifting to Asia-Pacific Region

Hong Kong, 2 December 2002 — Strong economic growth, coupled with greater consumer spending power, saw a positive growth in telecommunication services in the Asia-Pacific region, according to a new report by International Telecommunication Union. The effects of the 2001 global economic slowdown have been milder in this part of the world and a ranking of the ten most profitable public telecommunication operators shows that seven originate in Asia.

ITU Asia-Pacific Telecommunication Indicators, released by ITU to coincide with ITU Telecom Asia 2002, reports that as a global player the Asia-Pacific region distinguishes itself not only in size of its telecommunication market and growth in teledensity but also in technology deployment, and the innovative and flexible nature of its policy models.

In 2001, the region emerged as the world’s largest telecommunication market, having added more than one new telephone user every second for the last decade. The report observes that South Asia, currently the least developed sub-region with a teledensity of 4 in 2001, could provide the next great spurt of growth for the region as this is where the potential for "catch-up" is greatest.

While Japan and the Republic of Korea continue to lead the world in commercial deployment of 3G networks, small countries like Bhutan and Tonga have also leapfrogged to leading edge technologies such as wireless LANs and all-IP networks.

Singapore and Hong Kong, China withdrew exclusivity of their operators’ licenses in order to introduce competition in international services. Likewise, Thailand and Vietnam found ways to introduce alternative suppliers and foreign investment into their markets.

Mobile and Internet Economy

In the mobile economy, the Asia-Pacific region is poised to overtake Europe as the world’s largest market during 2002, although mobile penetration is still below 10%. Two of the top three mobile economies worldwide, as measured by mobile phones per capita, are from the region. They are Taiwan, China and Hong Kong, China. The region also hosts the economies with the largest number of mobile Internet users: Japan and Korea.

Mobile technologies also contributed to raising total teledensity dramatically in many developing countries that might otherwise have expected to remain locked into low levels of access. Thanks to mobile substitution, while half the region’s developing countries had a teledensity of less than one in 1993, this had been reduced to only two (Afghanistan and Myanmar) by mid-2002.

The notion that restrictions on content would hinder Internet usage has been disproved in Asia, as the region, with 160 million users, now accounts for one-third of the total Internet users in the world, more than any other region. Innovative schemes for community access, such as Indonesia’s warung internets or warnets, have boosted internet usage, as have prepaid cards and the boom in online gaming and e-government.

Asia-Pacific also leads the world in broadband Internet with five Asian economies among the top 12 worldwide in penetration. Related to this, capacity on Internet bandwidth has leapt eightfold over the last two years from 8 Gbit/s to 65 Gbit/s at the end of 2001.

"This region continues to push the envelope of universal service," says Michael Minges, lead author of the report. "For those Asian countries that have crossed a threshold of 30 telephone subscribers per 100 inhabitants, the focus has shifted to providing service directly to the home and on keeping phone service affordable as cross-subsidies disappear," he said.

According to co-author Tim Kelly, the region’s developing nations now have a much wider range of technical solutions for extending access than at any time in the past. These solutions include mobile, satellite and fixed-wireless access and well as traditional copper-based networks. "The developing nations of Asia represent the real test of the potential of mobile communications to extend access to telecommunication services. We know mobile phones are popular among the urban rich; but will they also change the lives of the rural poor?" Kelly said.

"Asia’s success story is evident in its rapid strides towards competition, and its sustained growth in the face of regional, and then global challenges," said Hamadoun Touré, Director of ITU’s Telecommunication Development Bureau. "However, the real reason for confidence lies not so much in the numbers of telephone, mobile and Internet subscribers in the region, but rather, the digital opportunities represented by the large numbers of those still waiting to be connected," Touré added.

For more Information, please contact:

Telecommunication Data and Statistics Unit
ITU Telecommunication Development Bureau
Tel: +41 22 730 6090
E-mail:
indicators@itu.int

Tim Kelly
Head, Strategy and Policy Unit
International Telecommunication Union
Tel: +41 22 730 5202
E-mail:
Tim.Kelly@itu.int

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