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Mobile Broadband as a Complement to Fixed Broadband Banjul, Gambia, 13 July 2010 Belinda Exelby, GSM Association. Mobile Complements Fixed for Broadband. Mobile. Fixed Broadband. 1.3 Billion Lines 19.4% of the world’s population. 4.8 Billion Connections 72.7% of the world’s population. - PowerPoint PPT Presentation
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Restricted - Confidential Information© GSM Association 2010All GSMA meetings are conducted in full compliance with the GSMA’s anti-trust compliance policy
Mobile Broadband as a Complement to Fixed BroadbandBanjul, Gambia, 13 July 2010
Belinda Exelby, GSM Association
© GSM Association 2010
Mobile Complements Fixed for Broadband
Fixed Broadband
1.3 Billion Lines19.4% of the world’s
population
Mobile
4.8 Billion Connections
72.7% of the world’s population
© GSM Association 2010
The Lessons of History
Source: Wireless Intelligence & ITU
(Fixed)
Comparing the slow growth in fixed broadband with the rapid pace of mobile adoption suggests that much of the future growth of broadband delivery will be over the mobile network.
© GSM Association 2010
The Changing Face of Mobile
Source: Wireless Intelligence, January, 2009
HSPA+28-42Mbps
HSPA14.4Mbps
WCDMA384kbps
GSM9.6kbps
2G
3G
GSM
HSPA
WCDMA
LTE100Mbps
199
0199
1199
2199
3199
4199
5199
6199
7199
8199
9200
0200
1200
2200
3200
4200
5200
6200
7200
8200
9201
0201
1201
2201
3201
4201
5
Consistent evolution of global standards provides economies of scale which drive down costs for consumers
© GSM Association 2010
HSPA Subscribers Today
HSPA/HSPA+ will dominate wireless broadband services, with 1.1 billion customers worldwide by 2015
US & Canada – 47.3MUS & Canada – 47.3M Western Europe – 75.6MWestern Europe – 75.6M Eastern Europe – 12.8MEastern Europe – 12.8M
Africa – 4.3MAfrica – 4.3M Asia Pac – 77.9MAsia Pac – 77.9MAmericas – 10.5MAmericas – 10.5M
Middle East – 9.3MMiddle East – 9.3M
Source: Wireless Intelligence, Q1 2010
Total HSPA Subs 237.7
million
© GSM Association 2010
LibyaHSPA Lunch: Q1 2007HSPA Subs: 811,983
EgyptHSPA Lunch: Q2 2006HSPA Subs: 819,774
BotswanaHSPA Lunch: Q3 2008HSPA Subs: 10,964
GhanaHSPA Lunch: Q4 2008HSPA Subs: 78,957
UgandaHSPA Lunch: Q4 2007HSPA Subs: 61,561
MadagascarHSPA Lunch: Q4 2009HSPA Subs: 5,411
MoroccoHSPA Lunch: Q2 2007HSPA Subs: 520,107
MozambiqueHSPA Lunch: Q4 2008HSPA Subs: 122,075
NamibiaHSPA Lunch: Q4 2006HSPA Subs: 37,832
NigeriaHSPA Lunch: Q1 2008HSPA Subs: 450,454
South AfricaHSPA Lunch: Q2 2006HSPA Subs: 1,289,510
TanzaniaHSPA Lunch: Q2 2007HSPA Subs: 112,997
KenyaHSPA Lunch: Q2 2008HSPA Subs: 31,218
HSPA Launch Dates and Subscribers in Africa
© GSM Association 2010
In Africa Mobile drives Broadband Penetration
In 2007, mobile broadband represented 24% of fixed broadband connections in Africa
By the end of 2009 this figure had climbed to almost 75%
© GSM Association 2010
Mobile Broadband - overtaking Fixed
Source: Wireless Intelligence & Telegeography
Where there is a choice of broadband access technology in Africa, consumers are using mobile more than fixed
© GSM Association 2010
Infrastructure Challenges
FIXED MOBILE
Limited existing infrastructure
High operating expenses
Further roll-out cumbersome and expensive
Rapid, relatively low-cost roll-out
Easily scalable
More spectrum becoming available
Mobile is critical for universal broadband coverage
© GSM Association 2010
Broadband -Transformational in Emerging Markets
© GSM Association 2010
Broadband Drives GDP Growth
World Bank analysis of 120 countries estimated that for every 10% increase in the penetration of broadband services, there is an increase in economic growth of 1.3%*
Booz & Co research found that:
Countries with 80% broadband penetration are more than twice as innovative as countries with 40% penetration
Increasing broadband penetration by 10% translates into a 1.5% increase in a country’s labour productivity
Sources: *World Bank, Qiang 2009; † Booz & Company, Enabling Sustainable Digital Highways; Strategies for Next-Generation Broadband
†
© GSM Association 2010
How Broadband Stimulates Economic Growth
12
Source:McKinsey
Explanation Examples
GDP contribution from direct investments in network
Immediate value creation
Impact of broadband investment on suppliers of equipment, content, etc.Multiplier effects
Foreign direct investments as a result of good ICT infrastructure
Foreign direct investments
Direct (ICT industry)
Indirect (other industries)
Increase in knowledge and skills as well as improved services through broadband
Human capital formation
More efficient business processes because of connectivity
Productivity increases
© GSM Association 2010
Policy-making to Facilitate Mobile Broadband
POTENTIAL ACTIONS FOR POLICY MAKERS
• Make low-band spectrum available to reduce access network cost• Ensure allocation of sufficient contiguous spectrum (10–12 MHz)• Monitor and manage usage to optimize allocation• Guarantee neutrality of technology to ensure innovation
• Promote infrastructure sharing (tower/backhaul) to reduce network cost
• Allow spectrum sharing/national data roaming to increase efficiency and reduce operational costs
• Charge nominal spectrum/licence fees to ensure affordability• Award licences based on coverage, partially substituting or
replacing financial criteria
• Ensure an economically viable number of players in the market• Allow industry consolidation if not market-distorting
-40–50
-35–40
-25–35
-20–30
-15–30***
• Provide incentives for roll out (e.g., regulatory concessions) • Encourage public-private partnerships or grant separate
licenses for rural areas to drive coverage• Provide public funding for remote areas to achieve sufficient coverage
Impact on cost to serve per subscriber*
Total impact of up to 75% reduction in cost to serve
Source:McKinsey
© GSM Association 2010
1987-2010
450-600 MHz
in each market
1987-2010
450-600 MHz
in each market
X3
Regulators are allocating more bandwidth and eliminating or redefining spectrum caps as they realise broadband requires
more spectrum
Regulators are allocating more bandwidth and eliminating or redefining spectrum caps as they realise broadband requires
more spectrum
According to ITU, by the year 2020 mobile services will need:
1.280 GHz for low market demand (rural areas)
1.720 GHz for high market demand (urban areas)
Aggregated Band Width
2010-2020
1.3GHz-1.7GHz
in each market
2010-2020
1.3GHz-1.7GHz
in each market
Spectrum is Needed for Broadband to Grow
Source: ITU-R Report M.2078
© GSM Association 2010
Economic Impact of Taxation
Impact of Taxation on the Development of the Mobile Broadband Sector in Emerging Countries, GSMA, July 2010
© GSM Association 2010
Estimated percentage increase in mobile penetration resulting
from changes in taxation
Estimated percentage increase in mobile user base resulting
from changes in taxation
Note: Malaysia is considered to be the benchmark at 6.1%
Taxation Structure Impacts Mobile Penetration
Source: Impact of Taxation on the Development of the Mobile Broadband Sector in Emerging Countries, GSMA, July 2010
Reduction of 1% of tax on TCO
Reduction of tax to benchmark rate (6.1%)
Reduction of 1% of tax on TCO
Reduction of tax to benchmark rate (6.1%)
© GSM Association 2010
Conclusions
Mobile broadband is a vital complement to fixed
Internet connectivity via mobile broadband will dramatically enhance people’s lives
and prospects provide a huge boost to national
economies Spectrum and taxation policies will
affect the pace at which mobile broadband networks can be rolled out
© GSM Association 2010
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