Comparative Broadband Policy: Hong Kong, Singapore, and Taiwan

Broadband and Mobile Adoption

Policy Review of Hong Kong, Singapore, and Taiwan

Prepared by: Bessie Chu COMM 531 Communication and International Economy University of Southern California 12/4/13

WHY REVIEW? Regional and national governments may find this information useful in their own policymaking

Basis for comparison: • Recent governments all defined by post World War II geopolitics. • All three are relatively low-resource islands with ethnically Chinese majorities.

• Hong Kong and Singapore are city states. • Taipei dominant city as cultural, commerce, and governmental capital of Taiwan.

• All three arrived at similar rates of broadband and mobile penetration on different paths.

ITU

BEN

CH

MA

RK

ETS

Adop

tions

per

100

inha

bita

nts

Mobile Broadband (Smart Phones) 2005 2010 2013 Developed 47.18 44.74 41.62 Developing 12.72 11.96 11.13

World 19.12 17.82 16.49

Cell Phone Penetration 2005 2010 2013 Developed 82.09 115.00 128.16 Developing 22.92 68.96 89.40

World 33.92 77.20 96.21

Individuals with Internet Access at Home 2005 2010 2013

Developed 44.68 66.28 77.73 Developing 8.14 16.44 28.00

World 18.43 30.00 41.25

Worldwide

Hong Kong, Singapore, Taiwan, and United States Mobile-Cellular Telephone Subscriptions 2005 2010 2012

Hong Kong 125.47 195.57 214.72 Singapore 70.10 102.78 153.40

Taiwan 97.55 119.91 126.46 United States (Provided for Context) 68.63 91.86 98.17

Percentage of Individuals Using Internet 2005 2010 2012

Hong Kong 56.90 72.00 72.80 Singapore 61.00 71.00 74.18

Taiwan 58.01 71.50 75.99 United States (Provide for Context) 67.97 74.00 81.03

From: h(p://www.itu.int/en/ITU-‐D/Sta9s9cs/Pages/stat/default.aspx

Hong Kong

–  British Colony from 1842 to 1997

–  Special administration region within China

–  Population 7+ million –  $36,560 USD income

per capita

Popula9on and Income Figures from World Bank Figures 2012: h(p://data.worldbank.org/country/hong-‐kong-‐sar-‐china

HONG KONG State of Mobile and Broadband

Chart: h(p://www.budde.com.au/Research/Hong-‐Kong-‐Telecoms-‐Mobile-‐Broadband-‐and-‐Forecasts.html

Hong Kong: Government Policies

•  Hong Kong Government made it a priority to establish advanced telecommunications infrastructure with policies to make it a regional e-Commerce hub

•  Implemented digital network in 1993, one of first societies to have 100% digital backbone with fiber, microwave, and satellite networks –  Land area of only 1092 square kilometers with 388,000

kilometers of optical fiber cables and linked with 9 submarine cables by 2000

•  Used strategy of deregulated competitive market •  Government was able to act as a steward by subsidizing

education and infrastructure services through real estate land leases to maintain low tax rates and remain a strong regulatory body

Hong Kong: Policy Theme “What other countries can learn from

Hong Kong is that an effective regulator is important especially in the case of increasing broadband access. By ensuring a competitive market for broadband, it is possible for the market to drive network roll out with minimal government intervention and subsidy.” From: Does a na9onal broadband policy ma(er? A Compara9ve analysis of broadband plans of Hong Kong and Singapore h(p://www.cprsouth.org/wp-‐content/uploads/2012/08/Junio_Policy_Brief.pdf/

SINGAPORE

– 1965 Separates from Malaysia shortly after Independence from UK

– Authoritarian Government effectively ruled by one party

– Population of 5+ million

– $47,210 USD income per capita

Popula9on and Income Figures from World Bank Figures 2012: h(p://data.worldbank.org/country/singapore

SINGAPORE State of Mobile and Broadband

Chart: h(p://www.budde.com.au/Research/Singapore-‐Telecoms-‐Mobile-‐and-‐Broadband.html

Singapore: Government Policies •  Development of internet crucial as a regional shipping

and financial hub since 1980s with National IT Plan •  Intelligent Island 2000 Master plan beginning in 1991 for

IT to permeate island •  SingaporeONE broadband initiative

–  Regarded as failure for not understanding users and no avenue for complaints

•  Liberalized telecommunications sector starting in 2000 by letting more operators compete and giving less support to SingTel and Starhub

•  First country to have fully broadband network and one of first to look to look at internet content and other policy issues

•  Policies dominated by Infocomm Development Authority

Singapore: Policy Theme ”1997 Masterplan for Information

Technology in education with vision of everyone home, office, and school wired to nationwide information infrastructure… Intelligent Nation 2015 Masterplan to navigate Singapore’s transition into An Intelligent Nation, A Global City, Powered by Infocomm” From: h(p://www.ida.gov.sg/Infocomm-‐Landscape/iN2015-‐Masterplan/Progress-‐Milestones/Infocomm-‐in-‐Singapore-‐Today

TAIWAN

•  Taiwan Key Facts –  1945 Japanese

surrenders the island to Republic of China as ruling government

–  Current multi-party democracy after 1987

–  Population 23+ million –  $39,600 USD income

per capita

Popula9on and Income Figures CIA World Factbook: h(ps://www.cia.gov/library/publica9ons/the-‐world-‐factbook/geos/tw.html

TAIWAN State of Mobile and Broadband

Chart: h(p://www.budde.com.au/Research/Taiwan-‐Telecoms-‐Mobile-‐Broadband-‐and-‐Forecasts.html

Taiwan: Government Policies

•  Priority given to telecommunications investments since 1980s

•  Government led “networking” of firms, cooperative networks, and development plans

•  Moves to lower taxes and reduce red tape to spur development and investment

•  1996 New Telecommunications Act: separation of Chunghwa Telecommunications for privatization

•  National Info-Com Develop Plan –  E-Government and E-infrastructure (2002-2007) –  Mobile Taiwan (2005-2009) –  Ubiquitous Taiwan (2008-2011) –  Intelligent Taiwan (2008-present)

Taiwan: Policy Theme “The Taiwan government’s entire

industrial policy apparatus was geared toward promoting nationally owned firms, private and public, in both industry and services. Competition from foreign investors was structured in such a way as to strengthen national firms through technology transfer and ‘spillover’.” From: Alice H. Amsden, Wan-‐wen Chu. (2003). Beyond late development taiwan's upgrading policies. Cambridge, Massachuse(s: The MIT Press.

Comparative Notes

•  All recognized and actively competed against each other, in particular Singapore and Hong Kong as port cities and regional financial hubs

•  Policies also became priority as China opened up and developed, partially spurred by desire to create and have regional influence on Chinese Internet

Deregulated Competitive Landscape

Hong Kong Top Down

Government Initiatives

Singapore Government Invention and Networks

Taiwan

Hong Kong Fiber at home service 1,000 megabits (gig) a second for less than $26 | Fastest service at

Verizon is 50 megabits a second for $144.99 “In the United States, costs would come down if

companies shared the financial burden of putting fiber into the ground and then competed on the basis

of services built on top of the shared assets. That would bring multiple competitors into the picture,

pushing down prices. But it would also require regulatory changes that the Federal Communications

Commission has yet to show an appetite for.”

Why Should We Care?

For developing countries and underserved regions:

“Price is a big determinant in adoption in different countries,” even with infrastructure (James, 2003).

From: Stross, R. (2011, Mar 6, 2011). Cheap, ultrafast broadband? at least hong kong has it: [money and

Business/Financial desk]. New York Times, s, R. (pp. BU.4.

James, J. (2013). Digital interac9ons in developing countries an economic perspec9ve. New York, NY: Routledge

Recommendations

Active Government Approach with Localization in Mind

Infrastructure

Build Social, Educational, and

Business Capacity

Eventual Deregulation and Liberalization of

Telecom Companies

Interoperability and Spectrum Management

Price Affordability

THANK YOU Questions?

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