Telecom service providers bank on broadband

MUMBAI: Telecommunications service providers in the Asia Pacific region are focusing more on broadband and mobile segments to sustain growth and revenues.






This move comes after revenues from the fixed voice segment continue to decline, according to a Frost & Sullivan analysis.





The rising adoption of third-generation (3G) services, broadband and the flourishing cellular markets in countries such as India and Indonesia are promising engines of growth that will ensure service
providers remain competitive.






New analysis from Frost & Sullivan, Asia Pacific Telecom Services Review and Forecast Databank, reveals that revenues in this market - covering 13 major Asia Pacific economies - totaled $246.20 billion in 2004 and is expected to reach $320.80 billion by 2008- end.





“Although service providers are providing faster network speed, the pressure to bring down prices persists,” notes Frost & Sullivan program leader Janice Chong. “In time, service providers are likely to migrate to flat-rate or capped plans, as the cellular market matures and the rate of broadband adoption improves.”





Flat-rate schemes find acceptance among 3G service providers that offer transparent and user-friendly bundled packages comprising voice and data services. Along with this, the unlimited data download packages offered by broadband service providers are becoming increasingly popular in the Asia Pacific region.





To take advantage of these developments, operators need to overcome the increasing threat of mobile technologies, pricing concerns and competition from alternative voice services threatening the fixed voice solutions by offering innovative packages.





Although some countries witnessed a rise in the number of fixed lines, the impact of mobile and voice-enabled options is forcing a decline in traffic minutes, and subsequently, the revenues in fixed voice solutions.





“While the growth of broadband solutions aids in stabilizing the decline in fixed-line sales, it also drives VoIP (Voice over Internet Protocol) services,” points out Chong. “This would lead to a greater number of fixed-line connections, but a slump in the revenue of traditional fixed voice revenue.”





Apart from implementing fixed-mobile convergence, broadband is perceived as the most promising means for service providers to regain the share of lost fixed-lines and sustain core revenues.





Rising end-user migration towards broadband services and the enormous growth opportunities in new markets such as India, Indonesia and the Philippines is set to boost revenues of Internet-based services.





Countries such as South Korea are introducing policies aimed at the rapid deployment of broadband infrastructure - ensuring the affordability of access fees and progress of next-generation technologies such as WiBro (wireless broadband), and eventually encouraging its mass adoption.





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