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SUMMARY
China 's broadband market continued to grow in 2005. This is due to the
booming economy, growing income of the population, expanding PC penetration
and increasing number of Internet users, the national Olympics, new
applications such as VoIP and IPTV, as well as the adoption of new
technologies. Accelerating growth of the number of Internet users and low
penetration renders an enormous potential for future broadband growth.
The de facto incumbents, China Telecom and China Netcom, are leveraging their
strong fixed subscriber base to increase their dominant DSL broadband
penetration. With their eye on the decreasing ARPU trend, operators are
actively exploring new revenue sources such as content development and IPTV to
maintain growth. The broadband business is already moving from a pure
high-speed access to content development and triple play, representing a shift
from predominantly price-based competition to bandwidth, price, content and
services.
Broadband access, along with its extended value-added services and
applications, has now become the most important growth driver for fixed
operators. The dominance of the DSL operators is expected to continue as
regulatory barriers continue to prevent cable operators from emerging as
strong competitors in the broadband market.
While prospects for broadband in China remain bright in the coming future,
uncertainties still prevail. Restructuring of the telecoms industry, changes
in broadband-related and IPTV regulatory policy and entry of foreign players
in accordance to the WTO commitment could have different effects on future
developments.
This piece provides an in-depth analysis of the Chinese broadband market, and
how we expect the market to evolve over coming years.
TABLE OF CONTENTS
Huge potential ahead
Ovum view
Status of broadband in China
- Figure 1 Broadband trend and penetration in China (2001-2005)
- Figure 2 Dial-up versus broadband development
- Figure 3 Broadband subscriber per 100 inhabitants in the Asia Pacific
(2005)
- Figure 4 Broadband technology split by subscribers at end 2005
Factors affecting broadband development
Market dynamics
- Figure 5 Operator's market share for broadband in China (subscribers as of
Mar 2006)
- Figure 6 Subscriber growth for China Telecom and China Netcom
- Figure 7 Broadband revenues and ARPU for China Telecom & China Netcom
- Figure 8 Broadband revenues for major broadband operators
- Figure 9 Comparison of technology used by major broadband providers
Key player's strategy
Market outlook
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