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Rapid User Migration to Broadband Fuels Growth of Internet Access Services Market

Posted on: Tuesday, 31 October 2006, 21:00 CST

SINGAPORE, Oct. 31 /PRNewswire/ -- Internet access services in Asia Pacific continue to see aggressive revenue growth, mainly as a result of the growing migration to broadband services. Internet access, especially broadband, is crucial for fixed line service providers to reclaim lost fixed lines and maintain core revenues.

The overall Asia Pacific Internet subscriber base grew 5.9 percent, reaching 161.8 million at end of 2005. Future Internet revenues expect to largely emanate from the continuous migration to broadband services and the explosive growth in first-time user markets particularly in India, Indonesia and the Philippines.

New analysis from global growth consulting company, Frost & Sullivan (http://www.frost.com/communicationsservices ), Asia Pacific Fixed Communications Outlook - Internet Access Services Market, reveals that revenues in this market -- covering 13 major Asia Pacific economies -- totaled U.S. $24.6 billion in 2005 and can reach an estimated U.S. $40.3 billion by end-2012.

If you are interested in a virtual brochure, which provides service providers, vendors/manufacturers, end users and other industry participants with an overview of the Asia Pacific Internet access services market, then send an e-mail to Letticia Leopold, Corporate Communications, at letticia.leopold@frost.com with your full name, company name, title, telephone number, fax number, city, state, country and e-mail address. Upon receipt of the above information, an overview will be sent to you by e-mail.

As a result of the rapid end-user migration, broadband has now surpassed the narrowband subscriber base, accounting for 53.3 percent of total Internet subscribers in 2005. The broadband subscriber base is forecasted to further grow at a CAGR (compound annual growth rate) of 12.7 percent from 2005 to 2012. By end-2012, broadband subscribers expects to account for more than 80 percent of the total Internet subscriber base in the region, with much of this growth stemming from Southeast Asia, China and India. China alone expects to account for more than 45 percent of the region's broadband subscribers in 2012.

"xDSL (x digital subscriber line) continues to be the predominant access technology which accounted for 67.2 percent of the total subscriber base in 2005," notes Frost & Sullivan industry analyst Krishna Baidya. "Although FTTx (fiber-to-the-x) is also gaining popularity in the region, its development (in terms of subscriber base) is likely to pale in comparison to xDSL in the medium term due to the high investment cost."

Not withstanding the favorable outlook, broadband home penetration in Asia Pacific is still low at only 9.8 percent in 2005. Low PC literacy and Internet usage along with affordability issues, and the slow unbundling of the local loop and poor broadband infrastructure have restrained growth to a large extent beyond the tier-1 markets (Japan, South Korea, Hong Kong and Singapore).

"As the broadband access services market develops and matures, market forces are likely to lower the prices for broadband access services," says Baidya. "This will mean lower profit margins, necessitating service providers to create new revenue streams by expanding their range of services."

Although much of the subscriber growth in the Asia Pacific Internet access services market expects to come from the developing markets, it is the developed markets that are likely to have a greater influence on revenue growth. While increasing bandwidth presents opportunities for service providers to introduce services such as VoIP (voice over Internet Protocol), IPTV (Internet Protocol television), video communications and home networking, it is important for service providers to introduce these services in a timely manner to avoid user frustration, which could raise skepticism on broadband.

Asia Pacific Fixed Communications Outlook - Internet Access Services Market is part of the Communications Services subscription, which also includes research on the following sectors: Asia Pacific residential telephony and service providers' consumer strategies. All research included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants. Analyst interviews are available to the press.

Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company's industry expertise integrates growth consulting, growth partnership services and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies and the investment community by providing comprehensive industry coverage that reflects a unique global perspective and combines ongoing analysis of markets, technologies, econometrics and demographics. For more information, visit http://www.frost.com/

CONTACT: Sarah Lourdes Corporate Communications - Asia Pacific P: +603.6207.1030 E: sarah.lourdes@frost.com Letticia Leopold Corporate Communications - Asia Pacific P: +603.6207.1031 E: letticia.leopold@frost.com Mireya Castilla Corporate Communications - North America P: +1.210.247.3830 E: mireya.castilla@frost.com Sharmin Jassal Corporate Communications - Australia & New Zealand P: +61.2.8247.8900 E: sharmin.jassal@frost.com Surbhi Dedhia Corporate Communications - South Asia & Middle East P: +91.22.5001.3431 E: sdedhia@frost.com Srividhya Parthasarathy Corporate Communications - Europe P: +91.44.4204.4668 E: sparthasarathy@frost.com

Frost & Sullivan

CONTACT: Sarah Lourdes, Corporate Communications - Asia Pacific,+603-6207-1030, or sarah.lourdes@frost.com , or Letticia Leopold, CorporateCommunications - Asia Pacific, +603-6207-1031, or letticia.leopold@frost.com ,or Mireya Castilla, Corporate Communications - North America, +1-210-247-3830,or mireya.castilla@frost.com , or Sharmin Jassal, Corporate Communications -Australia & New Zealand, +61-2-8247-8900, or sharmin.jassal@frost.com , orSurbhi Dedhia, Corporate Communications - South Asia & Middle East,+91-22-5001-3431, or sdedhia@frost.com , or Srividhya Parthasarathy, CorporateCommunications - Europe, +91-44-4204-4668, or sparthasarathy@frost.com , allof Frost & Sullivan

Web site: http://www.frost.com/http://www.frost.com/communicationsservices

Source: PRNewswire

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