Fiber expected to increase Taiwan's Internet market 44% by 2013

MARCH 31, 2009 -- Fiber will eclipse DSL in Taiwan's Internet market within the next five years, finds Pyramid Research.

MARCH 31, 2009 -- The migration from narrowband and DSL to fiber will increase the size of Taiwan's Internet market from $1.6 billion in 2008 to $2.3 billion in 2013, according to a new report from Pyramid Research (search Lightwave for Pyramid Research), the telecom research arm of the Light Reading Communications Network.

The report, "Communications Markets in Taiwan," profiles the country's converged telecommunications, media, and technology sectors based on proprietary data from research in the Taiwanese market. The report provides competitive analysis of both the fixed and mobile sectors, tracks the market shares of technologies and services, and monitors the introduction and spread of new technologies such as WiMax, IPTV, and VoIP.

With a population of 22.7 million and generating service revenues worth $10.5 billion in 2008, Taiwan is the sixth largest and one of the most advanced telecom markets in Asia/Pacific, notes Daniel Yu, analyst at Pyramid Research and author of the report. "The market is expected to grow at a CAGR of 2.8% over the next five years, reaching $12 billion by 2013; this growth will largely come from increased usage of mobile data applications, with 83% of the market's revenue gains between 2008 and 2013 coming from broadband and mobile data," says Yu. "In anticipation of this trend, operators have been aggressive in deploying attractive low-tariff mobile data card schemes and PC/data card bundles."

However, facing the diminishing stable revenue stream from their voice businesses, operators are turning to fiber to generate additional revenue. "Taiwan enjoys one of the highest fiber penetration rates in the world, with 7% of households subscribed to fiber broadband services at year-end 2008," Yu says. "Given attractive pricing relative to other broadband solutions -- specifically DSL -- Pyramid Research projects that the total number of fiber households will eclipse DSL households by 2012, reaching 41% of households by 2013.

"The migration to fiber will increase the size of Taiwan's Internet market by 44% by 2013. Given Chunghwa Telecom's aggressive efforts to convert DSL and narrowband users to fiber by reducing the price and bundling the offer with IPTV, the total Internet market will increase from $1.6 billion in 2008 to $2.3 billion in 2013 when fiber subscriptions reach 4.1 million."

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