Point Topic: Fiber broadband subscribers surpass cable in Q1'08

JULY 3, 2008 -- In Q1 2008, fiber-optic broadband for the first time added more subscribers than cable, according to the latest data from Point Topic. While there were 2.5 million cable broadband subscribers added worldwide in the first three months of 2008, fiber grew by over 4.2 million users.

"It's a significant milestone for fiber-optic broadband; where it is available consumers will take fiber over other broadband technologies," notes Oliver Johnson, Point Topic CEO.

While there have been doubts expressed that consumers will find additional speed necessary or attractive, the evidence suggests otherwise. Price is a significant factor in their choice, say Point Topic analysts.

"If you look at the cost per megabit, then DSL comes in at around $20 per megabit per month taking global averages," Johnson reports. "Cable does better at roughly $12, but they are both completely eclipsed by fiber where costs can get as low as 50 cents per megabit per month."

While there are sizeable variations from country to country, region to region, and operator to operator, a rule of thumb is that DSL can cost the consumer more than 15 times as much as fiber to get a megabit of bandwidth, and cable is 7 times as expensive given the current tariffs, Point Topic says.

The growth in fiber numbers is being driven by China, Japan, and South Korea where cable and DSL are losing subscribers to the fiber technologies; in the U.S., UK, France, and Germany low availability means low adoption.

"There are problems in the de-regulated markets when it comes to major infrastructure investment," Johnson acknowledges. "Fiber deployment is expensive, and in the U.S. and Europe, there are significant regulatory hurdles to overcome."

"It's difficult to persuade operators to make the sort of commitment needed when they can't guarantee their returns," he continues. "In most western markets, regulators frown on monopolies, and it's very difficult to sanction government expenditure given the self-imposed legal frameworks. Without some form of centralized funding, however, it will be a long time before consumers in these markets get access to cheaper bandwidth."

China also continues to gain momentum in terms of broadband overall. At the moment, China is still number two in the world in terms of total broadband subscribers to the U.S., but the gap continues to close, analysts report.

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