April 4, 2006 Dallas, TX -- A newly released topic paper from The Diffusion Group (TDG) predicts that the number of FTTH subscribers in Asia will grow from 4.6 million in 2005 to more than 40 million by 2010 , accounting for as much as 25% of all Asian broadband subscribers in 2010. However, the group's analysts caution that the business case for Asian FTTH deployments will be "primarily urban" and will "vary dramatically" in emerging markets.
According to the report, the majority of FTTH deployments in Asia will be confined to areas where broadband penetration is mature, where bandwidth-hungry users continue to want more speed, and where governments provide incentives. The firm observes that FTTH deployments will be primarily limited to urban areas where "the most affluent, professional, and bandwidth-dependent consumers" reside in apartments or other multi-dwelling units (MDUs). Such environments where user density is very high makes the FTTH business case "much more attractive," says the firm.
To help identify where and when these specific opportunities will emerge within Asia's developing and emerging markets, TDG evaluated various deployment scenarios across suburban, urban, and rural market segments. As well, a variety of locale-specific factors such as labor rates and disposable income were added to the model; the firm notes that these variables "play a significant role in cost sensitivity analysis and ultimately determine which Asian regions cross the FTTH/DSL tipping point at which time."
The report also analyzes the importance of regional incumbents, as the firm predicts they will be an important factor in determining when the "tipping point" is reached, and when mass FTTH roll-outs are thus deemed attractive.
"While high levels of user density is important, it is the new revenues and consequently consumer ability to pay that make the business proposition significantly more attractive to operators," contends Frank Marum, analyst at TDG. "This is the real 'tipping point' for the FTTH industry: identifying the point at which the economics of deploying FTTH become more compelling than the economics of deploying or upgrading DSL."
The material for the topic paper, "The Market for FTTH in Asia: Different Geographies, Varied Opportunities," is drawn from the firm's previous report, "Fiber to the Home in Asia: Analysis & Forecasts," a study of Asia's growing telecommunications market with a particular focus on the current status of FTTH deployments and expected fiber deployments in China, India, Japan, South Korea, and, other Asian nations. The study also features a business case analysis including opex and capex projections, market drivers and inhibitors for global FTTH growth, and a detailed case study of a 100,000-user 'greenfield' FTTH deployment.