Global Mobile Market Fact Book 2008

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The Global Mobile Market Fact Book 2008
Published by telecomsmarketresearch.com In association with Buddecomm
September 2008
BuddeComm & Chiltern Magazine Services Ltd. 2008
Contents:
GSM & CDMA 3G Handsets Introduction ARPU Emerging Markets MVNOs Pre-Paid Spectrum Termination Rates Bluetooth & UWB Mobile Data Regional Markets Europe Europe Balkans and South East Europe Europe - Baltic countries Europe Central Europe Europe - France and Switzerland Europe - Germany and Austria Europe - Italy and Malta Europe - Russia, Belarus, Moldova and Ukraine Europe - Scandinavia Europe - Spain and Portugal Europe - United Kingdom and Ireland Africa: Africa Central and Eastern Regions Africa Lesotho, South Africa and Swaziland Africa Northern Regions Africa Southern Region and Indian Ocean Islands Africa Western Region Asia-Pacific Hong Kong and Macau Asia-Pacific Indonesia and Timor Leste Asia-Pacific - Japan Asia-Pacific Malaysia and Philippines Asia-Pacific Myanmar and Thailand Asia-Pacific North and South Korea Asia-Pacific - South Pacific Islands Asia-Pacific - Taiwan Asia-Pacific - China Asia-Pacific - Australia Asia-Pacific - New Zealand: North America Latin America Latin America Andean Bloc Latin America Central America Latin America Eastern Nations Latin America Mexico and the Caribbean Latin America Southern Cone Middle East Gulf Middle East Mediterranean and Levant Countries
3G:.................................................................... 4 Africa Central and Eastern Regions ....... 21 Africa Lesotho, South Africa and Swaziland .................................................. 23 Africa Northern Regions........................... 24 Africa Southern Region and Indian Ocean Islands ....................................................... 27 Africa Western Region.............................. 29 AFRICA: ......................................................... 20 ARPU: .............................................................. 5 Asia-Pacific - Australia ................................ 55 Asia-Pacific Hong Kong and Macau ....... 43 Asia-Pacific Indonesia and Timor Leste. 44 Asia-Pacific - Japan ..................................... 46 Asia-Pacific Malaysia and Philippines.... 48 Asia-Pacific Myanmar and Thailand ....... 50 Asia-Pacific - New Zealand: ........................ 57 Asia-Pacific North and South Korea ....... 52 Asia-Pacific - South Pacific Islands: .......... 54 Asia-Pacific - Taiwan.................................... 53 Asia-Pacific: China....................................... 41 Bluetooth & UWB: .......................................... 6 Disclaimer and Legal Notices ....................... 3 Emerging Markets: ......................................... 5 Europe Balkans and South East Europe .. 9 Europe - Baltic countries............................. 12 Europe Central Europe ............................... 9 Europe - France and Switzerland ............... 13
Europe - Germany and Austria ...................14 Europe - Italy and Malta ...............................15 Europe - Russia, Belarus, Moldova and Ukraine.......................................................16 Europe - Scandinavia ...................................17 Europe - Spain and Portugal .......................18 Europe - United Kingdom and Ireland........19 Europe: ............................................................7 GSM & CDMA: .................................................4 Handsets:.........................................................4 Introduction:....................................................4 Latin America Andean Bloc......................40 Latin America Central America ................37 Latin America Eastern Nations ................36 Latin America Mexico and the Caribbean ....................................................................38 Latin America Southern Cone..................39 Latin America:...............................................35 Middle East Gulf ........................................58 Middle East Mediterranean and Levant Countries ...................................................59 Mobile Data: ....................................................6 MVNOs: ............................................................5 North America:..............................................33 Pre-Paid: ..........................................................5 Regional Markets:...........................................7 Spectrum: ........................................................5 Termination Rates: .........................................6
BuddeComm & Chiltern Magazine Services Ltd.

Published 1st. September 2008. Copyright 2008
Disclaimer and Legal Notices.

Disclaimer. Every care has been taken in the preparation of this report to ensure that the information contained herein is accurate, factual and correct to the best of our knowledge, at the time of publishing. All opinions, suppositions, estimates and recommendations included in this report are solely the opinions of the authors unless otherwise stated. BuddeComm & Chiltern Magazine Services Ltd. accept no liability for any loss or damage or unforeseen consequential loss or damage arising from the use of the information contained within this document. The opinions, suppositions, estimates and recommendations within this report cannot be guaranteed, and readers use this information at their own risk. The information published in this document is subject to change without notice at any time, and BuddeComm & Chiltern Magazine Services Ltd. accept no liability or obligation to inform the reader of such changes. BuddeComm & Chiltern Magazine Services Ltd. do not promote or endorse any specific companies or products, the views and opinions we express in this report are wholly our own assessments, and independent from any external interest or influence. Many terms and phrases and trade names used in this document are proprietary and BuddeComm & Chiltern Magazine Services Ltd. recognises and acknowledges that all trademarks are copyright, belonging to their respective owners. Where possible, this document accords such terms and phrases and trade names to their respective owners. All Rights Reserved. No part of this document can be copied, shared, redistributed, transmitted, displayed in the public domain, stored or displayed on any internal or external company or private network or electronic retrieval system, nor reprinted, republished, reconstituted in any way without the express written permission of the publisher. Forwarding of this electronic document without the correct legal licence is theft. Its unethical, immoral and against the law. If you have any questions about the legal licence conditions under which this report has been distributed, please contact Chiltern Magazine Services Ltd. at keithw@cmsinfo.com. If you did not buy this report and a colleague or associate has sent it to you, do not assume you are legally entitled to read it: it is your responsibility to ensure you have the correct legal licence to read this document.
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The Global Mobile Market Fact Book 2008

Introduction:
While it still too early to claim a turnaround it is clear that the mobile industry is undergoing profound changes. The saturated developed markets are forcing the industry to find news revenue streams and we are now also see other organisations such as media companies, content providers, Internet media companies and private equity companies becoming involved in this market. Either the mobile industry or the IT/Internet industry is going to be the winner here, and BuddeComm believes it will be difficult for the mobile industry to stay in the lead.
GSM & CDMA:

With GSM being the leader in terms of 2G, the focus of the CDMA camp has turned to 3G which includes the technologies that bridge the gap to 3G (CDMA2000) and its 3G successor CDMA2000 1x EV-DO. This report provides an overview of the CDMA family, information on TDMA and Chinas TD-SCDMA standard; designed so that Chinese operators can stake their share in the 3G mobile market. In 2008 GSM technologies account for around 85% of the worlds digital mobile phones, the equivalent of over 2.6 billion users. This market share is expected to grow even more due to increasing mobile penetration in the developing markets and the uptake of 3G around the world. With GSM being the leader in terms of 2G, the focus of the CDMA camp has turned to 3G which includes the technologies that bridge the gap to 3G (CDMA2000) and its 3G successor CDMA2000 1x EV-DO. Chinas, and the TD-SCDMA standard; designed so that Chinese operators can stake their share in the 3G mobile market. See 2007 Mobile Communications and Mobile Data Technologies Handbook for further information.
3G:
In 2008 there are close to 300 million subscribers to 3G technologies worldwide. Finally, after more than five years of waiting, the business case for 3G is beginning to build and most 3G deployments now rollout smoothly in contrast to the many problems experienced in early years. The main objective of 3G systems is to provide a more robust network with a range of data and multimedia services. We are now are finally seeing a more rapid rollout of 3G services, as it becomes increasingly important for mobile operators to begin to tap into these new revenue streams, since there are not many other growth markets open to them. In this report BuddeComm provides an overview and analyses of 3G market developments, including the evolution of 3G to 4G. The report also includes subscriber statistics and forecasts and a brief case study on one of the more visible companies in the 3G market Hutchison with its 3 service. See Global Mobile Communications - Statistics, Trends and Forecasts for further information.
Handsets:
In 2008 Nokia retains its dominant position in terms of market share and in 2007 Samsung finally overtook Motorola for second place on a global scale. The mobile handset market has grown rapidly. Growth slowed markedly following the industry downturn in 2001, but started to recover in early 2004, with rapid growth during that year aided by the development of new equipment such as camera phones. While in 2006 overall handset sales worldwide were strong due to the growing demand from emerging markets such as China and India; 2007 saw a steadier growth of around 14%. This can be attributed to saturation in the developed
5 markets which is starting to balance out the booming growth we have observed in developing regions. This report provides statistics and forecasts for mobile handsets, including growth, sales and revenue. Current and historical market share for the top handset suppliers is also included. The report also provides information on key trends and developments in the industry.
MVNOs:
An MVNO is a mobile service provider that provides mobile services independently from the operator that is supplying the network. The MVNO model has been around for a number of years, but has been successful in only a few countries around the world. Some MVNOs are now introducing new business models, such as the launch of content-orientated MVNOs in the US.
Pre-Paid:
Avoiding the monthly fee has always been and still is a very successful way to broaden the appeal of mobile services. Many potential subscribers, particularly outside the business market, are simply not prepared to pay a monthly fee for a service that they feel they may use only occasionally, particularly if they are tied in to minimum contracts of one, two or even three years. The prepaid model has now taken off around the world and is particularly popular in developing markets.
ARPU:
Mobile ARPU levels differ widely between the regions of the world; however on the whole all regions have experienced declines in ARPU over the past few years. ARPU from mobile voice services have been particularly affected by cuts to tariff rates and the trend towards voice-data substitution. However in some markets, such as the US, overall mobile ARPU rates have remained fairly steady due to the increased use in mobile data services, which has had somewhat of a balancing out effect. As would be expected, markets with strong competition have seen a considerable drop in mobile call charges.
Spectrum:
Before 1990, it was only possible to use the UHF band and below, thereby limiting the speed of information transfer. Since then governments have released more of the high frequency spectra; allowing for major advances in technology and service. Spectrum auctions have become an increasingly popular way of assigning spectrum licences throughout the world, with the USA holding one of its largest auctions ever in 2006. Towards the end of 2007, the USA was granted the ability at the World Radio Communications Conference (WRC-07) to auction off the 700MHz frequency to new service providers such as Google, who has expressed interest in acquiring spectrum. Auctions took place in 2008. In Europe and other parts of the world the band 790-862MHz has been allocated to mobile telecommunication services, but not until 2015.
Emerging Markets:
The emerging markets are making their mark on the mobile sector, with many of the less mature regions around the world showing significant growth and operators around the world are certainly taking note. This has assisted in the number of subscribers worldwide continuing to grow, despite saturated developed markets. Many emerging markets, such as Asia Pacific still have room for more growth ahead. There are now around 3 billion mobile subscribers worldwide and some of the more mature markets have over 100% penetration.
Termination Rates:
Competition continues to increase in the telecommunications sector because users of all forms of technologies continues to grow, especially in personal communications. This applies to the mobile industry, where mobile subscribers have more than doubled in the last five years or so. Competition will continue to increase as more participants enter the mobile market, and the convergence of fixed and mobile continues. International roaming charges are finally beginning to drop due to both this competition and the introduction of regulations/price capping.
Mobile Data:
Mobile commerce is potentially important for a wide range of industries, including telecommunications, IT, finance, retail and the media, as well as for end-users. It will work best in those areas where it can emphasise the core virtue of mobile networks convenience. However while there are good applications, the technologies and business models to date have not been well suited to mass market applications. This is beginning to change as banks and merchants are now collaborating with mobile operators. Applications around contactless cards using Near Field Communications are also being developed and trialled around the world. Focus has also turned to the developing markets, where mobile phones are being viewed as an opportunity to reach the masses that would not otherwise use m-payment or mbanking services. This report includes information on trends, statistics and analysis for the mcommerce sector, including m-payments and m-banking.
Bluetooth & UWB:

In 2008 further developments to the Bluetooth technology are taking place, with high-speed Bluetooth one of the key areas of focus (integrating Wi-Fi and/or UltraWideband technology). Bluetooth wireless technology continues to be widely adopted throughout the telecommunications, IT and home entertainment industries, as well as such diverse areas as automotive and health care; reaching almost all sectors of the economy. Work still continues today to combine the strengths of both Bluetooth and Ultra-Wideband technologies. Despite the absence of a global standard, some manufacturers are shipping Ultra-Wideband enabled laptop computers.
Regional Markets:
Europe:
The European telecom market in 2007 showed a vibrancy lacking in previous years, stimulated by continuing investments in the mobile and broadband sectors. While there was little further mobile network construction, most operators have upgraded existing networks to higher-capacity HSDPA to take advantage of mobile data offerings. In conjunction with these investments, in 2008 a greater emphasis will be placed on migrating consumers to 3G services and on developing content to stimulate higher-ARPU use among consumers. Some markets have also seen the first successful quad-play offers, either through mobile operators moving into the broadband arena or through established triple play telcos setting up as MVNOs. The review of the European Unions New Regulatory Framework (NRF) will create further changes in the sector during 2008 and 2009. In addition, the European Commission has focussed on a range of policies which will have far reaching implications for incumbents in coming years, including proposals for a single EU telecoms regulator and measures to force structural separation on incumbents in a bid to increase competition. Structural separation will be at the forefront in a number of markets in 2008, either through incumbents themselves (Ireland) or through government and regulatory pressure (Sweden, Italy, Denmark). Europe continues to be a prime testing ground for emerging technologies and new business models incorporating a growing range of services. Fixed-voice traffic and revenue continues to fall as mobile substitution and, to a lesser extent VoIP, take hold among consumers. Operators have thus focussed on data-rich applications such as mobile TV and Video-onDemand. The legacy copper networks continued to be supplemented by substantial cable and fibre network deployments during 2007. Further investment in the cable sector is expected to the end of the decade following the consolidation of cable operators in key markets (the UK, Germany, and The Netherlands). A substantial increase in fibre deployments is also expected in 2008-09, principally driven by municipal involvement in providing local open-access networks. Other key developments related to further progress towards NGNs, moving infrastructure to an IP packet-based, full service typology. In the UK some parts of the country were switched over to BTs 21CN during 2007, while most regions will be progressively migrated to the network in 2008 and 2009. Moves by national regulators, particularly in the Netherlands, have aimed to ensure that new entrants continue to have competitive access to NGNs following the closure of legacy networks, including exchanges and Main Distribution Frames. For further information, see Western European Mobile Communications Convergence In conjunction with investments in faster broadband networks, 2007 saw an increasing emphasis on triple play and quad play services. This development will be further stimulated in 2008 and coming years as network operators consolidate their competitive position through extensive agreements with content providers. IPTV packages of more than 100 channels have also become standard offers to attract and retain customers. Faster and more widespread broadband networks have expanded the reach of triple play to a greater proportion of the population, making the effective deployment of digital media commercially viable. With this infrastructure in place, companies can deliver innovative services which will in turn feed demand for more content. The market for digital TV has also grown rapidly. The UK is the market leader for digital TV penetration, though countries such as Italy have also made progress following government subsidies for set-top boxes. Sweden was one of the first to complete digital switchover, in October 2007, followed by the Netherlands. Billions of Euro will be invested in this sector in coming years, and local content providers will also profit. Clearly the long-term winners will be those players who are first to offer the consumer triple play on favourable terms. National incumbents have a good starting position, since they dominate the infrastructure industry,
8 though cable network operators also have a large subscriber base and many have been at the forefront in developing new strategies to encourage digital media. See Western European Convergence Market for further information. Mobile communications By early 2008 about 25 of the regions markets had exceeded 100% mobile penetration. Regulatory controls and increasing competition among network providers and from a growing number of MVNOs has lead to falling ARPU for most operators. Moving further into 2008 and 2009, the proportion of data revenue to total revenue will steadily increase: data ARPU has been resilient despite promotions lowering the price of SMS services, which alone can account for up to 90% of total data revenue. Operators have successfully focused on migrating subscribers to 3G, while GSM growth has been flat or minimal. Flat-rate data plans are beginning to take hold among operators, notably H3, and in coming years this simple business model should encourage greater use of 3G services and dispel consumer concern over high costs. Europe remains an important laboratory for emerging mobile technologies such as Enhanced Data for GSM Evolution and High-Speed Downlink Packet Access. Countries such as Finland are in the forefront of utilising 900MHz spectrum for 3G, launching the worlds first commercial 3G network in late 2007. Many countries are assigning for mobile use spectrum released by digital switchover, a move which promises much scope for innovative services in coming years. See Western European Mobile Communications for further information.
Europe Central Europe

While all are EU countries, the market in each one varies significantly, both in size and wealth: Slovenias GDP per capita is more than double that of Polands although Polands population is 19 times that of Slovenia. Impacting on the telecoms market is EU-mandated competition, decreasing prices and leading to the introduction of new services by competing operators and incumbents alike. See Europe - Telecoms, Mobile and Broadband in Central Europe for further information. Highlights: Benefits of regulatory measures are becoming evident the cost of unbundled local loops and shared access loops fell during 2007 in Slovakia and Slovenia while Hungary and Slovenia offer ULLs at prices below the average of the 27 EU member nations. FttH/FttB availability is expanding in all five countries, with deployments by all manner of different players in the telecoms market municipal governments, mobile network operators, fixed-line alternative operators as well as incumbents, a trend that is expected to continue moving into 2009. Emerging on the back of growing broadband penetration is the Internet economy, with data showing rises in the proportion of businesses or individuals accessing e-government services as well as businesses and individuals purchasing online. EU funding has improved accessibility to e-government services and broadband Internet in underserved areas, with additional funding until at least 2013. IPTV take up is on the rise in all five countries, as incumbents and telecom operators acquire additional content and improve service offerings. In response cable operators continue to poach fixed-line voice subscribers from the incumbent telcos. Commercial DVB-T services are well into deployment, with multiplexes launched or about to be launched in all five countries. DVB-H developments/trials are underway in Czech Republic, Hungary and Poland. Aggressively priced mobile broadband access with prepaid data bundles are available in all these countries, offered over now widely-available EDGE/WCDMA/HSDPA networks and posing significant challenges for existing wireless broadband (ie, WiMAX) operators.
Europe Balkans and South East Europe

This covers Albania, Bosnia-Herzegovina, Croatia, Cyprus, Macedonia, Montenegro and Serbia (including Kosovo) and the three largest countries in the region: Greece, Bulgaria and Romania. Economic development is transforming telecoms markets within this region as international investment drives infrastructure deployments and service rollouts. Numerous fixed-line networks in the region are undergoing modernisation at a fortunate time, with NGNs and advanced wireless broadband technologies such as WiMAX widely available. Low broadband penetration levels are rising at extraordinary rates, mirroring growth rates recorded in Central Eastern Europe during that regions initial broadband growth period in 2004/05. Future fixed-line broadband growth may be constrained by the falling number of fixed lines in service, given that numerous countries in the region had low fixed-line penetration levels to begin with. Mobile penetration growth is levelling off in some countries, indicative of mature markets. Service providers in such markets are focused on increasing ARPU levels through promoting 3G/HSDPA mobile broadband services and higher-spending postpaid plans to prepaid users.
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Both Bulgaria and Romania opened their markets as a result of EU ascension in 2007 and transposed the EUs communications regulatory framework into national law. Romania has achieved the most success immediately following liberalisation, with incumbent RomTelecom and a number of now well-established competitors modernising and upgrading infrastructure to expand availability of existing services and prepare for the introduction of new ones. The countrys nascent broadband sector will provide considerable opportunities in coming years, partly through the size of the market and the reach of both existing and new alternative infrastructure such as cable and FttH. Bulgaria is also witnessing new infrastructure rollouts, with FttH and WiMAX alternative operators launching services. A sizeable cable TV sector also exists, from which a new regional player is emerging after M&A activity in the sector. Greeces growing wholesale market, evident from rapidly rising number of unbundled and shared local loops, is paving the way for competing ADSL2+ services. See Europe - Telecoms, Mobile and Broadband in Balkans and South East Europe for further information. Key Highlights Establishment of a competing fibre backbone wholesale carrier in Albania has allowed a number of broadband ISPs to flourish. FttH services and Digital Video BroadcastingHandheld (DVB-H) services are available, with plans to increase DVB-H coverage to 80% by 2008. Bosnia-Herzegovinas government is preparing to privatise incumbent operator BH Telecom. Broadband subscriber levels are increasing and accounting for a growing percentage of total Internet users. During 2006 ADSL subscriber levels grew by 358% while cable broadband subscribers grew by 150%. For more information, see chapter 2, page 12. FttH services have been launched in Croatia. Numerous WiMAX operators have started operations, including a mobile network operator that also offers HSDPA mobile broadband. Year-on-year increasing GPRS usage growth rates suggest the product has reached critical mass and is gaining widespread market acceptance. Regulatory reforms designed to ensure a competitive wholesale market are bearing fruit in Cyprus, with local loops unbundled for the first time, which will assist the countrys main competing ADSL service provider that has launched ADSL2+ based triple play services. For more information, see chapter 5, page 85. Macedonias first alternative fixed-line operator launched services in January 2007. Broadband subscriber numbers grew by 194% during 2006 with competing WiMAX services to be launched during 2008. The country already boasts one of the worlds largest WiFi mesh networks providing 95% coverage. WiMAX licences were awarded in Montenegro in February 2007 to two alternative operators and a mobile network operator. ADSL subscriber numbers grew by 50% in the first six months on 2007 while 3G services were launched by both of the countrys established mobile network operators. A third mobile network operator has launched services in Serbia while a second approved operator is to launch services in Kosovo. 3G services were launched by all three Serbian mobile operators during 2006 - 2007 and HSDPA services are also available. Triple play services have been launched by a competing operator in Kosovo. Opportunities in the regions emerging markets continues to attract investment from established European telecom players: Slovenia Telecom acquired the largest competing ISPs in Albania, Bosnia-Herzegovina, Macedonia and Kosovo, while Telekom Austria launched two mobile network operators in Serbia and Montenegro during 2007.
11 RCS&RDS and UPC have emerged as Romanias premier alternative operators, each capturing an equal share of the fixed-line market through triple play offerings. Cable and LAN are the two most popular broadband access methods in Romania, together accounting for 66% of all broadband users. LAN broadband is available from a large number of micro ISPs, many of which are likely to consolidate as competition from ADSL provider RomTelecom intensifies. Romanian cable operators are well positioned to offer triple play services as cable TV household penetration is the third highest in the EU behind Belgium and Holland. Traditionally a cable TV operator, RCS&RDS has rolled out FttB networks in 15 cities, enabling the operator to take advantage of consumers appetite for services and content. RCS&RDS and CDMA mobile operator Zapp have both been awarded Romanias third and fourth 3G / WCDMA licences. This is RCS&RDS first foray as a mobile network operator and Zapps second as it already operates a 1x EV-DO network capable of 3G speeds. WiMAX services in Bulgaria have been rapidly launched by at least four competing alternative operators. The largest operator offers 85% population coverage, with plans to extend coverage to all cities with a population in excess of 50,000 during 2008. M&A activity in Bulgarias cable market has reduced the number of significant operators to two, the largest of which has expanded into Macedonia, with plans to expand further into the Balkans, with Serbia, Albania and Turkey likely target markets. All three mobile network operators in Bulgaria have launched 3G services. Price competition of 3G data services will encourage promotion and development of affordable and desirable mobile content, opening up a new market to complement the saturated mobile voice market. Regulatory reforms designed to ensure a competitive wholesale market are bearing fruit in Greece, with the combined number of shared access/unbundled loops increasing 918% in the year to June 2007. The number of LLU-based ADSL/ADSL2+ service providers is increasing in Greece, with the markets growth potential attracting unlikely players such as mobile network operator Vodafone, which commenced offering LLU-based ADSL services in October 2007. Balkans and South East Europe - mobile subscribers and penetration - March 2007 Country Albania BosniaHerzegovina Bulgaria Croatia Cyprus Greece Macedonia Montenegro Romania Serbia Subscribers 1,884,000 1,951,000 14,168,000 4,580,000 1,226,000 8,670,000 1,453,000 714,000 18,574,000 7,922,000 Penetration 52.4% 43.0% 132.0% 101.9% 127.6% 118.3% 70.7% 109.9% 83.4% 77.8%*
(Source: BuddeComm based on ITU and Global Mobile data) Note: * = Penetration was 86.6% for Serbia and 39.5% for Kosovo
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Europe - Baltic countries

The Baltics consist of Estonia, Latvia and Lithuania, which are characterised by relatively high broadband and mobile penetration. All three incumbents have managed to maintain or grow revenue despite losing market share to competing operators in traditional fixed-line voice markets. Growing ADSL and IPTV uptake has contributed to their success although they face increasing competition from the regions widely accessible cable TV network operators. Advanced HSDPA services are available in all three countries, with competition leading to the introduction of affordable mobile broadband access for the mass market. Broadband accounts for nearly all Internet connections in each country, with dial-up almost completely disappearing. Future broadband subscriber growth will be driven predominantly by first time subscribers rather than migrations from dial-up. Healthy infrastructure-based competition in the broadband market is evident as ADSL accounts for less than 50% of total broadband connections in all three countries. Cable is the leading competing broadband platform in all three countries while FttH/FttB accounts for approximately 15% of total broadband connections in Estonia and Lithuania. Despite widespread availability of ADSL and introduction of ADSL2+, Lithuanias incumbent has embarked on a FttX rollout drive which entails deploying infrastructure in the countrys five largest cities. Large scale or nationwide WiMAX deployments are underway or have been completed in Estonia and Lithuania, providing alternative last-mile access in urban areas or extending access networks into rural areas. Lithuanias incumbent has also aggressively rolled out WiFi hotspots as part of its target of 20,000 WiFi hotspots by 2010. Estonia dominates Eastern Europe in broadband penetration and Internet economy development. It is the only Eastern European country with broadband penetration above the EU average. Internet banking is undertaken by half of the population while the entire voting population is able to vote online, the first such country in the world. IPTV has been launched by incumbents in all three countries. Take up has been the most successful in Latvia, which launched MPEG-4 based services in April 2007. 3G-based mobile broadband access services with affordable pricing and generous data bundles (varying from 1Gb a month to unlimited) are available in all three countries. One Latvian mobile operator estimates that 30% of all laptops in Latvia will be connected to mobile broadband services during 2008. Mobile Internet access via WAP is very high in Lithuania, accounting for 73% of all Internet subscribers. For further information, see Europe - Telecoms, Mobile and Broadband in Baltic countries Mobile subscribers and penetration in the Baltic countries - March 2007 Country Mobile Subscribers Estonia 1,558,000 Latvia 2,303,000 Lithuania 4,795,000 (Source: BuddeComm) Penetration 118% 102% 134%
Data in this report is the latest available at the time of preparation and may not be for the current year.
13
Europe - France and Switzerland

Frances large and affluent population has propelled the countrys telecom market to the first tier in Europe. The incumbent operator France Telecom has a number of fixed-line and mobile interests sweeping across Europe and it is at the forefront of emerging convergent business models focussed on triple and quad play offerings. Domestically, France Telecom has progressed with its all-IP NeXT strategy, upgrading its infrastructure to cope with increasing consumer demand for high-bandwidth applications. The strategy has led to France being a global leader in IPTV, accounting for more than half of all IPTV subscribers in Europe in 2007. In addition, France is one of the top European countries for fibre deployment. Switzerlands smaller telecom market has excellent broadband and mobile services despite topographical challenges, and has become the first country in Europe to make broadband access a universal service. Government restrictions on Swisscoms ability to expand internationally were lifted in 2007, with the result that the company can now broaden its horizons. Its aggressive moves into central European markets and its purchase of Italys leading fibre operator FASTWEB in 2007 are indicative of how the company plans to compete with other major players on the international stage. For further information see Europe - Telecoms, Mobile and Broadband in France and Switzerland Key Highlights France remains Europes leading market for IPTV services, with the main service providers neuf Cegetel, France Telecom and Free (Iliad) competing for customers by offering an ever expanding range of channels coupled with Video-on-Demand services. VoIP is also very popular, and the provision of free national calls has become standard as operators look for the optimum portfolio of offers to secure customer stickiness. Digital TV take-up has progressed strongly. By January 2007 there were over 6.825 million DTTV STBs sold or leased in France, a 250% year-on-year increase. DTTV was available to 85% of the French population by mid-2007, and penetration for digital TV as a whole stood at about 40%. Frances mobile market is facing increasing competition from a growing number of MVNOs. Although the 2.1 million MVNO subscribers in September 2007 represented only 4% of the overall subscriber base, growth is increasing steadily and may reach 17% of the market by 2010. Digital switchover in Switzerland has progressed well. Switchover in the German speaking parts of the country was completed in November 2007, with only the canton of Oberwallis to switch over in February 2008. By the end of 2008 the first national digital transmitter network should be completed, making it possible to receive DVB-T signals throughout Switzerland. Analogue TV transmissions were scheduled to close in 2010. Growth in the Swiss broadband market has continued strongly, while legislation making the provision of broadband a Universal Service Obligation will dramatically increase broadband availability to outlying rural areas. Swisscoms hybrid fibre/VDSL infrastructure being rolled out to most cities by 2008 is exempted from LLU legislation, meaning that competitors will not have automatic access to it. This may protect Swisscoms investment in the short term but the European Commission may oblige competitor access to promote competition.
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Europe - Germany and Austria

Germany and Austria enjoy a common language and border, while telcos have made effective use of network sharing opportunities and operating synergies. Germany has Europes largest telecom market, supported by an affluent and tech-savvy population of more than 82 million. The incumbent, Deutsche Telekom, is one of Europes major companies and one of the largest telcos. The countrys broadband sector will provide considerable opportunities in coming years, partly through the size of the market and partly through investments in network upgrades which will encourage a range of IP-delivered services. Deutsche Telekom has continued to expand its national hybrid fibre and VDSL infrastructure, reaching more than 20 major cities by the end of 2007. Austrias telecom market is one of the smallest in the European Union, yet its advanced and progressive infrastructure has placed its providers in an excellent position to exploit opportunities in central and eastern Europe. Austrias topography encouraged the early development of cable networks which have been upgraded to provide a sound platform for triple play services such as iTV, VoIP and VoD. This report presents an overview of the telecom markets in these two important countries, including an assessment of sector liberalisation and privatisation, together with the key regulatory measures which affect competition and investment. It also examines the product offerings for the mobile sector, and assesses the latest developments in advanced services such as mobile TV and HSDPA. The important broadband market is assessed, together with forecasts for broadband growth to 2017 based on factors such as network investment, the regulatory environment and consumer demand. The report provides essential statistics covering the broadband, mobile and digital TV sectors, highlighting technological developments and the emergence of media convergence and triple play offerings. For further information see Europe - Telecoms, Mobile and Broadband in Germany and Austria Key Highlights Germanys digital TV market grew strongly in 2007 with a number of regions switching from analogue transmission. The potential audience of the digital network, being built by Deutsche Telekoms T-Systems division, reached 64 million by the end of the year, while digital take-up approached 20%. Triple play remains a developing market in Germany, but consumer take-up accelerated strongly in 2007. With more than ten providers offering services on a single platform, growth in 2008 is expected to be particularly strong. In addition to increased investment in cable network upgrades, delivering the required bandwidth, the DSL network of Deutsche Telekom will provide 50Mb/s to most of the country be the end of the decade. Deutsche Telekoms fibre/VDSL network, one of the largest undertakings in Europe, had gone live in 22 cities by the end of 2007. The 3 billion all-IP Next Generation Network forms a key strategic platform, enabling the company to take advantage of consumers appetite for services and content. The mobile markets in Germany and Austria remain fiercely competitive, with a growing number of MVNOs battling for customers. Operators have invested heavily in upgrading networks with HSDPA technology, and have promoted cheaper data rates to stimulate consumer take-up of high-bandwidth services. Germanys broadband subscriber base continued to develop well in 2007, spurred by the incumbents increasing coverage of its 50Mb/s service and by the successful business models of municipally owned and private network operators such as QSC; HanseNet and NetCologne.
15 Although Germany has a fragmented cable market the sector underwent further consolidation in 2007, with KDG expanding its presence in eight states in October. The country has a few major cablecos which can take advantage of scale to invest in network upgrades and so take compete effectively with ubiquitous DSL.
Europe - Italy and Malta

Italys mobile market is among the more dynamic in Europe, supported by a large population keen to adopt new services. The digital TV and broadband sectors have also progressed well. Italy also has one of the most advanced fibre infrastructures, with companies such as FASTWEB being among the top tier in Europe. Together with upgraded ADSL2+ networks, the widening fibre footprint has boosted popular take-up of triple play services, and will provide a strong foundation for IPTV, VoD and VoIP in coming years. For the country overview, see chapter 1, page 1. Malta has Europes smallest telecom market but does not lag behind in technological developments. The incumbent was rebranded as GO in 2007, and its new owners have invested in infrastructure upgrades. By the end of 2007 there were three 3G licensees, and while GO is currently the islands only quad play provider, Melita Cable and Vodafone both have ambitions to compete with full bundled services. See Europe - Telecoms, Mobile and Broadband in Italy and Malta for further information. Key Highlights Malta has kept abreast with the rest of Europe in the digital TV sector. GO is a quad play service provider, offering fixed voice, mobile, broadband and DTTV, with TV services available to 95% of the population. Vodafone launched 3G in 2007, bringing Malta in line with the rest of Europe in this important market. Mid-year coverage was extended to most major settlements. GO Mobile launched its HSDPA network in early 2007, and soon afterwards reduced tariffs to make services more affordable to a wider range of users. Maltas third 3G operator was licensed August 2007. Network roll-out is being funded by Melita Cable, which will make the cableco the islands second quad-play operator and providing greater competition against GO. Italys mobile market is among the most competitive in Europe. Take-up of 3G has reached almost 24% of total subscribers by mid-2007, the highest proportion in Europe. Continued growth in coming years will be supported by the propensity to own multiple SIMs and by the popularity of emerging mobile data services. Italys triple play development remains one of the strongest in Europe, and continued to mature in 2007 on the back of ADSL2+ and fibre roll-outs. FASTWEB is one of Europes leading fibre players, investing 3 billion in infrastructure by 2010 to reach 11.4 million potential customers, representing about 50% of the market.
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Europe - Russia, Belarus, Moldova and Ukraine

Rapid modernisation and development is transforming the region as alternative operators deploy alternative infrastructure and launch competing services. Incumbent and alternative operators alike are rolling out new technologies including Next Generation Networks, FttH and WiMAX to offer new services or cost-effectively expand availability of existing ones. Infrastructure deployments are supporting the launch of broadband and convergence services across the region, resulting in rising broadband penetration levels and the birth of IPTV and triple play services. This is particularly the case in the massive market that is Russia, with alternative and regional incumbent operators across the expansive nation promoting ADSL or fibre-based services. Fragmented cable TV markets exist in all countries, with quite a number of cable TV networks requiring investment to launch digital cable, broadband and/or voice services. Mature mobile markets exist in Ukraine, Russia and Belarus to a lesser extent, while new competitors are appearing in Ukraine and Moldova. For further information, see Europe - Telecoms, Mobile and Broadband in Russia, Belarus, Moldova and Ukraine Key Highlights Broadband availability has proliferated across the region. ADSL services are widely available. FttH and/or WIMAX networks have been deployed in all four countries. FttH/FttB networks have been deployed in previously unserved areas to provide futureproof last mile networks or high-bandwidth alternative infrastructure in high-density areas. WiMAX has been utilised by incumbents to extend last mile access into unserved lowdensity areas while alternative operators have deployed WiMAX to rapidly gain last mile access to customers, particularly in Russia and Ukraine where competitive last-mile access regimes are lacking. Triple play services are offered by a number of operators in Russia, Ukraine and Moldova, available via ADSL and FttH/FttB. Growth in Russias mobile market has peaked, leading major operators into a global search for new growth opportunities and confrontation with established western European telcos. Domestic growth prospects still exist due to underdeveloped mobile broadband and content markets. WCDMA 3G network deployments and services have been launched by the three national mobile network operators, which are now tasked with migrating millions of GSM users to 3G platforms to entice take up of high-speed mobile broadband and content services. Ukraines incumbent has finally launched WCDMA 3G services, threatening growth prospects of the countrys minor CDMA operators, some of which possessed the countrys fastest mobile broadband networks. A competing operator has executed a wellthought strategy by deploying a GSM-based unlicensed mobile access network in conjunction with a nationwide WiMAX network. Both fixed-line and mobile penetration levels are rapidly rising in Moldova, with total mobile market revenue expected to surpass fixed-line market revenue during 2008/09. Both total telecom market revenue and investment is thriving, posting 2006 annual growth rates of 33.6% and 23.3% respectively. Belarus government has relaxed ownership controls on its telecoms market, allowing a western European telco to acquire a majority stake in the countrys second largest mobile operator. Belarus, Moldova, Russia and Ukraine - mobile subscribers and penetration - 2007
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Country Subscribers Belarus 6,288,000 Moldova 1,511,000 Russia 159,250,000 Ukraine 51,241,000 (Compiled by BuddeComm, various industry sources)
Penetration 61.1% 33.8% 111.0% 110.2%
Europe - Scandinavia
With Icelands incumbent opening a 3G network in October 2007, all Scandinavian countries have now deployed some of Europes fastest mobile broadband technologies. Nokia has also used the region to trial its innovative mobile user generated content services. The region also has one of Europes most concentrated municipal fibre deployments, despite topographical difficulties, which are spurring take-up of triple play services. In digital broadcasting, Sweden and Finland had completed analogue switchover by October 2007, while most of the Danish population could receive all four digital multiplexes by August and Norway was prepared to launch national digital services in January 2008, with 95% geographic coverage. Swedens incumbent TeliaSonera bowed to regulator pressure for functional separation, having agreed to establish a new fully-owned infrastructure subsidiary covering copper and fibre networks and multiplexing. The move will further increase competition in the broadband sector, reducing prices and favouring stronger consumer take-up for fast connections in coming years. See Europe - Telecoms, Mobile and Broadband in Scandinavia for further information. Key Highlights Sminn opened Icelands first 3G network in October 2007, promising 60% population coverage by mid-2009 and offering download speeds at up to 7.2Mb/s. The development marks an ambitious investment for this small market, and brings the country into line with 3G deployments elsewhere in Scandinavia. Nordisk Mobiltelefon launched a commercial CDMA2000 1x EV-DO Rev A network in Norway in October 2007 using the 450MHz band, the first of its type in the world. A similar launch is planned for Sweden, while Finland is also using the 450MHz band to provide wireless broadband. Swedens switch-over to digital TV was completed in October 2007, ahead of the original February 2008 schedule and before many European countries begin the process. Competition in the mobile sector remains strong with a growing number of new resellers, though their overall market share remains low. Triple play services are beginning to reach mass market appeal on the back of upgraded fibre and ADSL2+ / VDSL networks, coupled with greater customer awareness of bundled products. Including VoIP, Video-on-Demand and IPTV. Scandinavia also enjoys some of the highest broadband penetration levels in Europe, with Iceland leading the world, closely followed by Sweden and Denmark, both of which have effective regulatory backing and strong involvement from municipal governments.
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Europe - Spain and Portugal

Spains large mobile market was slow to develop an Mobile Virtual Network Operator sector, but by the end of 2006 the national regulator and the European Commission overcame operator resistance to allowing competitor access to their networks. By mid-2007 several MVNOs were preparing to launch services. The launch of a 3G service by Xfera has added further competition to a lively market, while providers have invested huge sums in building networks to support HSDPA. Portugals smaller telecom market has proved to be a major growth area. The incumbent, Portugal Telecom, has significant interests in Brazil and sub-Saharan Africa, and domestically is the leading telco in all sectors. The countrys broadband growth is supported by an excellent cable and DSL footprint, while alternative operators such as Vodafone have emerged as key providers of faster ADSL2+ services. See Europe - Telecoms, Mobile and Broadband in Spain and Portugal for further information. Key Highlights Portugals broadband market showed continued strong growth in 2007. The incumbent dominates the DSL sector while its former subsidiary, PT Multimedia, sold in November 2007, bought up three regional cablecos in the year, further consolidating its market position. Cable data speeds at up to 100Mb/s were trialled in 2007, while ADSL2 at up to 24Mb/s is increasingly common. The government set a goal of 50% household broadband penetration by 2010, which should be easily achieved. Broadband in Spain remains comparatively slow, with almost half of all subscribers only able to access about 1Mb/s. This has dampened consumer take up triple play services, though Telefnica and alternative providers have invested heavily in network upgrades, and during 2008 ADSL2+ will be extended beyond the major urban areas. By 2010 up to half of all households should get a 50Mb/s service. IPTV take-up has grown rapidly in Spain, but its real potential will not be realised until 2008 when the countrys broadband infrastructure is further upgraded. Telefnicas Imagenio service is very popular, while ONO, Jazztel and Orange also provide multiplechannel IPTV. Regulator pressure opened up the Spanish market to MVNOs in late 2006, and by mid2007 several operators were prepared to launch services on the three networks. This development will herald great changes to the countrys mobile market in coming years as competition further reduces consumer prices. Portugal and Spain mobile penetration 2005 - 2008 Year (e) Portugal 2005 107% 2006 110% 2007 (e) 119% 2008 (e) 125% (Source: BuddeComm) Spain 97% 103% 113% 119%
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Europe - United Kingdom and Ireland

Irelands small telecom market contrasts with that of the UK, which is among Europes largest and most vibrant. Ireland has been slow to develop broadband and digital TV, while the UK has a highly competitive broadband sector and the largest digital TV market in the EU. In the UK the markets for triple play continued to mature during 2007, while digital TV take-up reached 85% by mid-year. The country began switching off analogue transmissions in October 2007 in a phased program to 2012. The consolidation of the cable market, with Virgin Media the dominant player, has helped rationalise network upgrades while the operator has extended its footprint through wholesale DSL access. Irelands incumbent, eircom, in October 2007 set in train its structural separation, aiming to separate its network infrastructure from its retail business. The model differs from that of BTs Openreach but if successful it may dramatically boost market competition and provide the stimulus for widespread broadband take-up, encourage investment in network upgrades and promote high-bandwidth triple play services in coming years. See Europe - Telecoms, Mobile and Broadband in United Kingdom and Ireland for further information. Key Highlights 2007 saw further development in quad-play offers, led by Virgin Media and BSkyB through its Sky Broadband, Sky Talk and Sky Plus brands. In October 2007 BSkyB launched a pared down version of its pay TV, broadband and telephone services under a new brand, Picnic. The companys equipment has been installed in BT exchanges covering 70% of UK homes. To address the UKs relatively low broadband download speeds the regulator in October 2007 promoted the concept of a national fibre network costing up to 15 billion, with the potential for regulatory intervention to safeguard operator investment sin the sector. eircom sought government approval to split companys wholesale and retail divisions into two separate operations, with different owners. The structural separation would go some way to address the countrys poor broadband infrastructure and take-up, though the company may expect its fibre network to be closed to competitors for up to five years as a part of any deal. The UKs digital and pay TV markets is among the most developed in Europe, with a range of services reached by about 85% of the population. The Mobile TV market was strengthened in 2007 with deals between operators and content providers - H3 with BSkyB, Orange and Vodafone with the BBC. H3 in April 2007 launched free advertising-funded mobile TV, while an advertising-funded MVNO, Blyk, may prove to be one of the more successful business models in the market.
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AFRICA:
While being the worlds most rapidly growing market for mobile telephony and also home to the fastest growing fixed telephony markets in the world, Africa still has some of the worlds lowest penetration rates. Foreign investors are scrambling for positions in this very lucrative market as privatisation and liberalisation are progressively being introduced. Explosive growth in the mobile sector has meant that by early 2007 mobile users constituted almost 90% of all African telephone subscribers. Other wireless solutions are also used to serve as substitutes for inadequate fixed-line infrastructure. A surge in demand for Internet access and broadband capabilities is expected to drive these developments further in the coming years. Several international fibre projects currently under development will deliver the necessary bandwidth to Africa and bring down costs. Overall, Africas telecoms future looks very promising and offers great opportunities to service providers, equipment vendors and investors. The continents mobile market is consistently growing at around 50-60% every year. Enormous further potential remains, with market penetration standing at little more than 20%. Due to Africas poor fixed-line infrastructure, the mobile networks are beginning to play an increasing role in Internet service provision as well, following the launch of 3G services in a number of markets a welcome new revenue stream in an almost entirely prepaid environment with low ARPU levels. Newly introduced converged licensing regimes have increased the competitive pressure in a number of key markets but also allow the mobile operators to branch out into new service segments. Africas data traffic is on the rise, fuelled by rapid growth of ADSL and wireless broadband services. Massive efforts are under way to adapt the continents underdeveloped infrastructure to the growing need, both on the national and international level. Broadband has begun to rapidly replace dial-up as the preferred access method, and this process is already virtually completed in the continents more developed markets. Overall Internet market penetration is still low at just over 4%, leaving ample room for further growth in the coming years. The extent of Next Generation Networks and services on the continent is still limited. There are, however, encouraging developments. Several countries have launched broadband initiatives and are rolling out dedicated IP-based networks and new fibre optic links. Given the still large amounts of unsatisfied demand for basic voice services in Africa, VoIP is a primary application at this stage, and this technology is now gaining ground on the continent following steady improvements in Internet bandwidth, deregulation in several countries and the growing number of VoIP service providers entering the market. The first triple play services have been launched across the continent, offering converged voice, data and broadband TV/video. WiMAX technology, currently being rolled out in at least 20 African countries, will enable the continent to leapfrog straight to wireless NGNs at affordable cost. The number of African countries where VoIP can be regarded as open to private operators has more than doubled to around 20 in 2007. Nevertheless, at least 10% of international calls in almost every country on the continent are still carried by unlicensed grey market players, because many operators are not yet passing on the full cost savings from VoIP to their customers. Profit margins are still very healthy in this emerging market. Broadcasting is an integral part of Africas development and a means of communication over the vast areas of the continent. Improvements in broadband infrastructure and the emergence of 3G mobile systems are now opening the way to convergence of conventional and digital media as well as telecommunications. With far greater ownership of TV sets compared to PCs in Africa, the broadcasters viewers represent a huge potential customer base for Internet services as well. Interactive TV, especially the variety using mobile phone text messages (SMS), has found its way to Africa and is growing fast. At least nine African countries are currently trialing or planning to introduce Broadband TV and VoD services, typically converged with voice and data services under so-called triple play models. For further information see Africa - Telecoms, Mobile and Broadband Overview
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Africa Central and Eastern Regions

Low fixed-line teledensity and Internet penetration and strong growth of mobile telephony have been the chief characteristics of the telecom markets in the Central and Eastern regions of Africa. Several new international submarine cable projects are now set to bring large amounts of fibre-based bandwidth to countries along the continents East coast and in the interior for the first time. Key countries in the region have privatised their incumbent telcos, liberalised international access and VoIP Internet telephony, and are implementing new competition frameworks. This is creating new opportunities in an environment of converging technologies and services and promises the long-awaited cost reduction and improved availability of telecommunications. Cameroon Like in most African countries, Cameroons mobile market has been booming since competition was introduced, while the fixed-line sector has been stagnant. Convergence between fixed and mobile, voice and data services is now set to change the market dramatically: The fixed-line incumbent, Camtel, is re-entering the mobile sector through a third national licence, while the existing mobile operators are establishing themselves as leading ISPs by introducing mobile data services and acquiring existing ISPs. The mobile operators are also among the bidders in the privatisation of a majority stake in Camtel with a view to providing converged services. The existing ISPs are combining their forces by merging and preparing to offer VoIP services through newly established wireless broadband networks. Democratic Republic of Congo The Democratic Republic of Congo is a mineral-rich country that is recovering from civil strife and many years of pillage by its former leaders which has accounted for the low level of development of its telecommunications and other infrastructure. While the traditional fixed-line network has deteriorated to almost non-existence, mobile telephony has experienced excellent growth. Wireless technologies serve as a replacement of the obsolete fixed network infrastructure and public payphones. National teledensity remains extremely low, creating enormous potential for the provision of basic services. There is also strong demand for Internet service which has been hampered by the underdeveloped telecoms infrastructure. Ethiopia Ethiopia still practices a monopoly in almost all areas of its telecoms sector. Market penetration is still very low, but major efforts to roll out a national fibre backbone and wireless access networks have resulted in an acceleration of growth in all market segments. Further massive investments into fixed, mobile and Internet services, totalling US$4 billion, are planned for the five years to 2012. The government is intent on eventually privatising the national operator, ETC, and introducing competition in mobile and Internet services. Gabon Following the introduction of competition between three service providers in Gabon, this relatively small and wealthy African nation has achieved one of the highest mobile market penetration rates on the continent, but its fixed-line and Internet sectors remain underdeveloped due to a lack of competition and the resulting high prices. The recently completed privatisation of Gabon Tlcom may bring new impetus to the market in 2007 if coupled with further market liberalisation. Kenya Kenyas mobile market looks likely to move beyond a duopoly in 2007 with the third operator, already licensed since 2003, set to finally overcome its legal challenges and shareholder disputes. At the same time, fixed-line incumbent Telkom Kenya will be privatised and licensed to compete in the mobile sector directly, and the to-be-licensed second national operator will have a mobile concession as well. Telkom would have to dispose of its majority stake in
22 leading mobile operator Safaricom, opening up an opportunity for strategic investors. Enormous further growth potential exists, with mobile market penetration at only just over 20%. Convergence is ever-present in Kenyas dynamic and fast growing market, with legalised VoIP enabling cheaper calls through newly licensed international gateways, the introduction of 3G mobile services catapulting the mobile operators into the virtually untapped Internet sector, and mobile banking services empowering the largely un-banked population. New international submarine fibre projects will bring bandwidth prices down further and open the Internet up to the mass market. Wireless broadband technologies and ADSL, soon to be followed by ADSL2, have been introduced and at least four WiMAX network rollouts are going on or being planned with the aim of providing converged voice, data and video/broadband TV (triple play) services. Mergers and acquisitions are in full swing. Rwanda In Rwanda, the aftermath of the 1994 genocide and a monopolistic market structure until 2006 have weighed on the telecommunications sector, but the country is now on its way to outpace most other markets in Africa, which as a whole is already the fastest growing region in the world. The 99% privatised incumbent telco is more innovative than most of its African counterparts in the provision of market-driven, affordable services, and it was recently licensed to compete in the mobile sector as well. The country has one of the most developed fibre infrastructures in the region and is preparing to connect to the new high-bandwidth submarine cables that are being planned along the east cost of Africa. Tanzania Tanzania has a fully competitive mobile sector comprising four networks and two fixed-line operators. Nonetheless, market penetration is still very low. A new converged licensing regime introduced in 2006 has brought a large number of new players into the market, including the countrys third national fixed-line and fifth mobile network operator. The liberalisation of VoIP as well as the introduction of Third-Generation mobile services and wireless broadband networks is also expected to provide a boost to the Internet sector which has been hampered by the low level of development of the traditional fixed-line network. Uganda As early as 1999, Uganda became the first country in Africa where the number of mobile subscribers passed the number of fixed-line users, and the ratio is now more than 18:1. With three mobile networks, the market is consistently growing at around 50% p.a., while market penetration is still low at less than 9%. A new competition framework has been announced which will include the licensing of a third national operator and the liberalisation of VoIP, creating additional opportunities for ISPs who are already operating wireless broadband networks. The recent introduction of GPRS will enable the mobile operators to play a larger role in Internet service provision as well, and a fourth licence for 3G mobile technology is being considered. See Africa - Telecoms, Mobile and Broadband in Central and Eastern Regions for further information. Key highlights Fixed-line, mobile and Internet market forecasts to 2010 and 2015 for Cameroon, Ethiopia, Gabon, Kenya and Rwanda; Privatisation of incumbent telcos underway in Cameroon and Kenya; New converged licensing frameworks introduced in Kenya and Tanzania, with other countries set to follow in their footsteps;
23 Full liberalisation of VoIP Internet telephony expected in Uganda; A number of countries in the region have taken a world lead role by abolishing international mobile roaming surcharges; 3G mobile services launched in Tanzania, commercial launch expected in Kenya before the end of the year; WiMAX networks are operational or under development in almost every country in the region; The Democratic Republic of Congo is set to become the worlds first entirely wireless country, with virtually no fixed-line network left.
Africa Lesotho, South Africa and Swaziland

South Africa is the economic powerhouse and leading telecommunications market of the continent, but a lack of competition in several key areas has slowed developments down in recent years and allowed the country to be overtaken by some other African countries in terms of certain key indicators. At more than 70% penetration, South Africa will see a flattening subscriber growth curve in its mobile market over the next few years, leaving service providers to compete aggressively on price, value-add and quality of services. The boom will be taken over by the provision of broadband Internet access, combined with voice and entertainment services in a converging and more competitive environment of fixed, wireless and mobile platforms. The small kingdoms of Lesotho and Swaziland are expected to follow in the footsteps of their powerful neighbour, privatise their incumbent telecom monopolies and further liberalise their markets. South Africa South Africas telecom sector boasts the continents most advanced networks in terms of technology deployed and services provided. The country is taking a regional lead role in the convergence of telecommunication and information technologies. The long awaited new Electronic Communications Act (formerly Convergence Bill) was finally enacted in mid-2006. Sweeping liberalisation measures taken two years earlier, legalising - among other things the use of VoIP, have begun to change the countrys telecoms landscape fundamentally. ISPs are turning into phone companies, and vice versa. Both are moving into delivering audio and video content over their networks, while in turn the traditional electronic media carriers are discovering the potential of their infrastructure for telecommunications service delivery. The newly licensed SNO, Neotel finally launched services in competition to Telkom SA in early 2007, using nationwide infrastructure of Eskom and Transtel, the countrys electricity and railway utilities. Broadcasting signal carrier Sentech is another major owner of telecommunications infrastructure, and some of the largest municipalities in the country are also rolling out their own networks. Wireless technologies are being pursued to provide alternatives to Telkoms copper access network. The end of Telkoms monopoly on the international SAT-3 submarine cable in 2007 is expected to help reduce the costs of telecommunication in South Africa which are currently among the highest in the world. Despite being open to competition by more than 200 ISPs, South Africas Internet sector has been stagnant in recent years due to the expensive operating environment created by Telkom SAs dominance in the fixed-line and bandwidth market. Under the incumbents monopoly rule, fixed-line teledensity has continuously fallen since 2000. Modest growth has now returned to the Internet market, stimulated by the launch of ADSL and wireless broadband services in 2004, followed by continuous price cuts in the following years. Further stimulus is expected in 2007 from the launch of the SNO and an expansion of 3G/HSDPA services by the countrys mobile network operators. The continents leading mobile market, South Africa has seen rapid uptake of GSM since competition was introduced to the sector more than 10 years ago. With market penetration exceeding 70% and mobile number portability introduced in 2006, the subscriber growth
24 curve has started to flatten, increasingly forcing the three network operators to find innovative ways of distinguishing themselves from the competition in order to gain and retain customers. The introduction of mobile Internet and multimedia services via 3G mobile technology is one way of doing this and has lead to a marked increase in data traffic. Another is the adoption of the MVNO model, highlighted by the entry of Virgin Mobile into the market. Lesotho Telecommunications in Lesotho has undergone gradual transformation from a state-owned monopoly to a privately majority-owned national operator, with competition in the mobile subsector since 2002. Mobile market penetration was approaching 20% in mid-2007 compared with a fixed-line teledensity and Internet penetration of less than 3%. The use of wireless technology has led to an accelerated increase of teledensity, which in turn will foster further growth in Internet penetration. Following the end of Telecom Lesothos exclusivity period, more competition may be introduced in several market segments. Swaziland The telecoms sector in Swaziland features an old-style posts and telecom monopoly operator for fixed services and one of the last mobile monopolies on the continent as well. Nevertheless, fixed and mobile penetration is relatively high compared with other countries in the region. The level of Internet usage, only about average in the region, has been held back by a lack of attractive broadband offerings, caused by the limited extent of the fixed-line network and limited options for affordable international bandwidth. The planned unbundling and eventual privatisation of the incumbent and the introduction of more competition would enable the market to live up to its relative GDP strength. See Africa - Telecoms, Mobile and Broadband in Lesotho, South Africa and Swaziland for further information. Key highlights: Fixed-line, mobile and Internet/broadband market forecasts to 2010 and 2015 for South Africa and Swaziland; Second national operator (SNO) in South Africa has launched services; Telkom SA continues to post record results; South African mobile market is approaching saturation; Mobile data revenue close to 10% of total in South Africa; ADSL is rapidly replacing dial-up as the main Internet access method in South Africa; Telkom SA prepares major WiMAX launch in early 2008; Telecom Lesotho is pushing fixed-mobile convergence; Swazilands incumbent SPTC due for privatisation following major restructuring program.
Africa Northern Regions

Northern Africa is home to some of the most developed telecom markets on the continent. All countries in this group except for landlocked Chad have well developed fixed-line infrastructures and direct access to international submarine fibre optic cables. Most incumbent telcos in the region are already privatised, with Algerie Telecom scheduled to follow suit in 2007. Tunisia is planning to licence a second fixed-line operator, joining Algeria, Egypt, Morocco and Sudan which already have two and, in the case of Morocco, three operators. Algeria, Egypt, Morocco and Tunisia have fast growing broadband markets,
25 supported by some of the lowest access prices in Africa. Commercial 3G mobile services have been launched in Egypt, Libya and Morocco and are expected in Algeria and Sudan shortly while Tunisia has several pilot projects. Commercial WiMAX networks are operational in Algeria and Morocco, with rollouts in progress in Egypt and Tunisia. Algeria Algerias mobile market exceeded all expectations when it continued to grow by around 200% four years in a row and soared past the 65% penetration mark. The countrys fixed-line market lags behind the other relatively affluent North African countries, and its second operator is considering exiting the market again after only one year of operations, claiming unfair competition. Accelerated developments can be expected from 2007 onwards resulting from the upcoming privatisation of the countrys incumbent telco, the award of 3G mobile licences, the expansion of wireless broadband networks and VoIP Internet telephony services. Algeria has some of the lowest ADSL prices in Africa, an extensive national and international fibre backbone network, and a FttH pilot project. Chad The recent discovery of oil is set to bring Chad some of the foreign investment it urgently needs to upgrade its telecom facilities and other infrastructure. The country has some of the worlds lowest penetration rates for fixed-line, mobile and Internet services. Competition exists only in the mobile sector between two privately owned networks. The fixed-line incumbents network is running at its capacity limit which, along with high prices, has also hampered the development of the Internet sector. One of the mobile operators has embarked on seizing this opportunity by introducing mobile data services. Egypt Egypts telecom sector is performing consistently well with all sub-sectors being open to competition. Around 1,500 new fixed lines are installed in the country every day which has helped to reduce the waiting list by around 90% in recent years. The incumbent telco, Telecom Egypt, is partially privatised and highly profitable. The end of its fixed-line monopoly in 2006 has opened up new opportunities for competitive service providers, and a third mobile licence has been awarded. VoIP Internet telephony has been liberalised, and several companies are rolling out NGN to provide converged voice and data services. Supported by forward-looking government programs, Egypt has become one of the leading Internet markets in Africa in terms of users, international bandwidth and services offered. The country is well connected by several international submarine fibre optic cables in combination with a national fibre backbone infrastructure, and the international bandwidth market has been liberalised. The entire sector is highly competitive with more than 200 Internet and data service providers, which has lead to some of the lowest prices for ADSL services on the continent and broadband packages with up to 24Mb/s delivered to residential households. Egypt became one of the first countries in Africa to launch 3G mobile services in May 2007, following the award of the countrys third mobile licence in 2006. The record price that was paid for the licence indicates the potential that is seen in the Egyptian mobile market, at less than 30% market penetration which is about equally shared between two GSM operators. In anticipation of the new competition, subscriber growth has accelerated. Both existing networks have launched a range of mobile data and information services. Libya Libya is emerging from almost two decades of economic isolation, which contributed to the stagnation of its oil industry, the mainstay of its economy, and invariably its telecoms sector. Despite having an old style monopoly player for the provision of posts and telecommunications services, its fixed-line network is superior to those in many other African countries and is sporting one of the highest teledensities on the continent. In sharp contrast, the mobile sub-sector remained underdeveloped until the introduction of a second GSM
26 network in 2004 which sent market penetration skyrocketing from one of the lowest in Africa to one of the highest within only two years. 3G mobile services have been launched and are set to stimulate the underdeveloped Internet sector as well. Morocco Morocco is one of the most advanced telecommunications markets in Africa, featuring a majority-privatised, highly profitable incumbent telco, three fixed network operators, a mobile penetration in excess of 55%, as well as the highest penetration and some of the lowest prices for broadband access on the continent. The second and third fixed network operators are both rolling out wireless infrastructures based on the WiMAX standard which will allow the provision of converged next-generation IP-based services. A commercial IPTV service was launched as one of the first in Africa. 3G mobile services were introduced in 2007. The Moroccan market is set for continued spectacular growth that will see it reach levels of development rivalling those of some European markets over the next five to ten years. Sudan The third largest oil producer in sub-Saharan Africa and one of the biggest countries on the continent, Sudan is regarded as one of Africas most lucrative telecommunications markets, receiving hundreds of millions of Dollars in foreign investment in 2007. Enormous further potential exists since penetration rates are still low in all market segments. Two fixed-line and three mobile networks are competing for customers, rolling out broadband and nextgeneration services. The majority stake in the countrys leading mobile network was sold in 2006 for a record price. Under a recent peace agreement, the oil-rich south of the country which has been beyond the central governments control and deprived of development, is now establishing its own independent telecommunications regime, creating huge new opportunities for service providers and equipment suppliers. Tunisia Tunisia has one of the most developed telecommunications infrastructures in the relatively affluent Northern African region and sports some of the continents highest market penetration rates. The mobile sector has experienced exceptional growth since the introduction of competition in 2002. A nationwide fibre optic backbone and international access via submarine cables, coupled with some of the lowest broadband prices in Africa have supported rapid development of the Internet sector. The incumbent telco was part-privatised in 2006, and the licensing of a second fixed-line operator is expected in the near future. See Africa - Telecoms, Mobile and Broadband in Northern Region for further information. Key highlights Fixed-line, mobile and Internet market forecasts to 2010 and 2015 for Algeria, Egypt and Morocco; Second fixed-line licence expected in Tunisia; Privatisation of Algerie Telecom in progress; Algeria and Egypt are the most advanced VoIP markets in Africa; One of Africas first commercial IPTV services launched in Morocco; A majority stake in Sudans leading mobile network was sold for a record price; Libyas mobile market penetration has skyrocketed from one of the lowest in Africa to one of the highest within only two years.
27 Mobile subscribers and penetration rate in Libya - 1998-2006 Year Subscribers Penetration 1998 20,000 0.34% 1999 28,000 0.51% 2000 39,800 0.71% 2001 50,000 0.89% 2002 710,000 1.3% 2003 127,000 2.3% 2004 320,000 5.6% 2005 877,700 15% 2006 (e) 4,015,000 67% (Source: BuddeComm based on industry data)
Africa Southern Region and Indian Ocean Islands

The diversity among the countries in this group is immense, ranging from the small Indian Ocean island nation of Mauritius, sporting some of the best telecoms market indicators of the continent, to some of the poorest countries in the world like Malawi and the island of Madagascar, as well as countries which have emerged from decades-long civil wars like Angola and Mozambique and which are consequently at a very low level of development. In between are relatively wealthy nations like Botswana and Namibia which benefit from their close ties with South Africa. In its deep political and economic crisis, neighbouring Zimbabwe is demonstrating how telecoms markets in Africa survive even the most difficult of operating conditions. Angola Angola is the second-largest producer of oil in sub-Saharan Africa, and the recent rise of oil prices may push GDP growth as high as 35% in 2007. With peace restored in 2002 after almost 30 years of civil war, foreign investment has multiplied. However, Angola Telecoms fixed-line network still serves less than 1% of the population. The licensing of four new fixedwireless operators in 2002 has introduced competition to this sector, using 3G wireless technologies and WiMAX to provide advanced services. A national fibre optic backbone network is being implemented. Privatisation of Angola Telecom and the licensing of a third mobile operator are expected in the not too distant future. Botswana Botswana is one of the continents wealthiest nations with a thriving economy mainly based on diamond exploitation and tourism. Major steps were taken in 2006 towards full liberalisation of the already competitive telecommunications sector. Mobile penetration has passed the 50% mark which is more than twice the African average, while the governmentowned national operator BTC has seen a continued decline in the number fixed-line connections despite the introduction of ADSL broadband services. The government is in the process of privatising BTC which, through a new service-neutral licence, is now also enabled to compete in the mobile sector. Madagascar The new private owners of Madagascars incumbent telco, Telma, have managed to almost double the number of fixed line customers in 2006 alone after years of stagnation, albeit from a very low base. They also entered the mobile market successfully as the countrys third player. Penetration rates in both sectors are still extremely low, promising excellent growth potential. Pent-up demand for Internet access and broadband capabilities, resulting from the traditionally underdeveloped fixed network, will continue driving both market sectors. With one of the lowest GDPs per capita in the world, there will be limits to the growth of Madagascars telecoms market, but plans to exploit and export crude oil and natural gas reserves may deliver a boost to the economy.
28 Malawi Malawis incumbent telco, MTL, was finally privatised in 2006 following several unsuccessful attempts. A second national operator was licensed in May 2007 and the countys third mobile licence is expected later in the year. Malawis telecommunications sector is among the least developed in Africa with a fixed-line penetration rate below 1%, despite more than doubling the number of fixed-line connections in the past five years. The mobile sector has grown more than ten-fold during the same period, but market penetration is still very low in this sub-sector as well, around 5%. Several ISPs are rolling out wireless broadband networks, and the planned liberalisation of Internet telephony (VoIP) should create further opportunities. Mauritius The island nation of Mauritius sports some of the best telecommunication market indicators in Africa and has been the first with many innovations: It launched Africas first cellular system in 1989, the first commercial 3G mobile service in November 2004, and the worlds first nationwide high-speed wireless broadband network based on the WiMAX standard in 2005. Mauritius is actively pursuing a policy to make telecommunications the fifth pillar of its economy after sugar, textiles, tourism and financial services, and to become a regional telecom hub with Singapore as a role model. The incumbent telco has been partially privatised and all sectors of the market are open to competition. A second fixed-line and third mobile operator launched services in 2006, giving additional impetus to the market moving into 2007. Mozambique Fifteen years of peace and radical reforms have transformed Mozambique into one of the fastest-growing economies on the continent. The country was one of the first in the region to reform its telecommunications landscape, immediately after a peace accord had been reached in 1992. The mobile sub-sector has experienced excellent growth rates, and yet, market penetration is still only about half the African average. An announcement regarding the licensing of a third mobile operator is expected before the end of 2007. Internet usage is expected to receive a boost from wireless broadband networks currently being rolled out and the introduction of 3G mobile services in the second half of 2007. Namibia Namibia was one of the last countries in Africa to introduce competition in the mobile communications sector when a second network finally launched in 2007. Despite this, the country had already achieved a market penetration rate above the African average. The other mobile network was partially privatised in 2006 and has launched 3G services. The fixed-line incumbent, Telecom Namibia, quietly entered the lucrative mobile market as the third player but was put on hold by the regulator until the new ICT Bill brings clarity about fixed-mobile convergence, among other issues. Several WiMAX networks currently under development will boost Internet connectivity and bring additional competition to the voice market once Internet telephony (VoIP) is deregulated. With an extensive fibre optic backbone, the country is well positioned to remain one of the most developed telecommunications markets in Africa. Zambia Zambia has an independently regulated telecoms sector with three competing mobile networks and a monopoly fixed-line operator, Zamtel. While the mobile sector has experienced excellent growth, market penetration is still relatively low at little more than half the African average. The fixed-line network is at a very low level of development, which in turn has impeded growth in the Internet sector. The countrys ISPs are rolling out wireless broadband networks, positioning themselves as competitors in the telecoms sector once Internet telephony (VoIP) is fully liberalised a key component in Zambias new ICT Policy which was launched in early 2007.
29 Zimbabwe Zimbabwes almost decade-old deep political and economic crisis has not spared the countrys telecom industry, with a dwindling local currency, hyper inflation and government interference creating a difficult operating environment. Attempts to privatise the national telco during this time have failed, as has a second national operator, unable to raise the necessary funding. Growth of the countrys three mobile networks has been slowed down temporarily, but an immense pent-up demand is now being addressed following major infrastructure upgrades, including the introduction of 3G mobile services. The countrys backbone network is being upgraded, including fibre optic links which will also improve Internet connectivity. For further information see Africa - Telecoms, Mobile and Broadband in Southern Region and Indian Ocean Islands Key highlights: Fixed-line, mobile and Internet market forecasts to 2010 and 2015 for Angola and Madagascar, two of Africas most promising growth markets driven by oil revenues; Privatisation of incumbent telcos expected in Angola and Botswana; Successful turnaround story of Madagascars incumbent telco following privatisation; Additional mobile licences expected in Angola, Malawi and Mozambique; 3G mobile services launched in Namibia, expected in Angola, Mozambique and Zimbabwe before the end of the year; WiMAX networks are operational or under development in almost every country in the region; Converged Triple Play services (voice, broadband data and IPTV) launched in Mauritius; Liberalisation of VoIP expected in Malawi; In its almost decade-old deep political and economic crisis, Zimbabwe demonstrates how telecoms markets in Africa survive even the most difficult of operating conditions. Mobile subscribers and penetration in Zimbabwe - 1997-2006 Year 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (Source: BuddeComm) Subscribers 11,300 55,000 177,000 281,000 325,400 336,500 385,100 509,800 745,600 1,001,300 Penetration 0.09% 0.45% 1.53% 2.42% 2.81% 2.89% 3.28% 3.92% 5.74% 8.21%
Africa Western Region

The countries in this group include some of Africas most liberalised telecommunications markets. Ghana led the way when it privatised its national telco as early as 1995, with Cte dIvoire and Senegal following in 1997 when France Telecom acquired stakes. The mobile markets in this region are highly competitive with three or more network operators in most
30 countries. With hundreds of service providers for all kinds of telecommunication services, Nigeria is one of the continents largest and fastest growing markets. Foreign investors from Europe, the Middle East and South Africa continue to keep a keen eye on every takeover opportunity or new operator licence being tendered in the region, as market penetration rates are still relatively low. While growth prospects in the mobile voice market are still excellent, the focus is beginning to shift to broadband Internet and converged voice and data services. Continuing liberalisation of VoIP is creating new opportunities for wireless broadband access networks that are set to replace the extremely underdeveloped copper fixed-line networks and ultimately compete in the mobile sector as well. Extensive national fibre optic backbone networks are being rolled out, and all countries in this group have access to high-speed transmission capacity on submarine cable systems linking them with each other and the rest of the world. Benin Benin only recently separated an old-style posts and telecommunications entity and established an independent regulator. Uncertainty currently hangs over the liberalisation of the sector, caused by aggressive restructuring attempts by the government. Even the mobile sector, already highly competitive with four networks, is affected. However, once a clear, investor-friendly framework is back in place, the growth prospects are excellent, with penetration rates in all market segments well below African averages. Burkina Faso Following the majority-privatisation at the end of 2006 of Burkina Fasos incumbent telco, Onatel, fresh investment is expected to accelerate the development of the national network infrastructure. Mobile telephony has experienced outstanding growth, with subscribers to the three digital networks now outnumbering fixed lines in the country by more than 10:1. Moving into 2007, the telecom sector promises new opportunities with the governments plans to license several new international gateway operators, rural operators and possibly a VoIP operator. Cte dIvoire A new peace agreement signed in Cte dIvoire in March 2007 gives hope for a normalisation of affairs in this divided country. However, most segments of the telecom market have continued to flourish during the crisis which started in 1999. Recent events such as the launch of a third and a fourth mobile network and the sale of the second national operator for more than US$30,000 per customer are indicators for the enormous potential that is seen in this market. The country has a relatively well developed infrastructure and some of the lowest prices in Africa for ADSL broadband services, with speeds of up to 8Mb/s. Gambia Gambia has had a 100% digital network since 1995, but fixed-line penetration has remained low at around 3%, which in turn has hindered Internet usage. This is expected to change with ambitious plans to multiply teledensity by 2008, making extensive use of wireless systems. ADSL broadband services were introduced in Gambia in 2006. Mobile penetration is well above the African average and is expected to be driven further by the recent licensing of a third and fourth network operator. The recent award of additional international licences, the planned privatisation of Gamtel, and the new Telecommunications Bill, including new guidelines on VoIP, are expected to lead to new opportunities for additional market players. Ghana Ghana led the way in telecommunications liberalisation and deregulation in Africa when it privatised Ghana Telecom as early as 1996. It was also among the first countries in Africa connected to the Internet and to introduce ADSL broadband services. Four mobile operators
31 are competing for customers. The sale of second national operator Westel, which also holds the countrys fifth mobile licence, in early 2007 for almost four times the asking price indicates the huge potential that is seen in the market despite the already intense competition. Following a share buy-back from the original private stakeholder, Ghana Telecom will be looking for a new strategic investor and float part of its equity on the local stock market. Nigeria Nigeria is one of the biggest and fastest growing telecom markets in Africa, attracting huge amounts of foreign investment, and is yet standing at low to very low levels of market penetration. Over 200 companies are providing virtually all kinds of telecom and value-added services. The mobile sector has seen triple-digit growth rates five years in a row since competition was introduced. With an ailing incumbent that was finally privatised in 2006, a second national operator and several private fixed-wireless operators dominate the fixed-line market. A fifth GSM operator and four 3G mobile networks were licensed in early 2007. A new unified licensing regime designed to increase competition between fixed and mobile network operators is expected to also give a boost to the Internet sector. VoIP is already carrying the bulk of Nigerias international voice traffic. The current deployment of the countrys first NGN will drive further convergence of voice, data and video/TV, enabling the provision of triple play services that will ultimately also involve the countrys already competitive broadcasting sector. Senegal Senegal has developed one of Africas most extensive and modern telecommunications infrastructures. The national operator Sonatel is partially privatised and highly profitable. The incumbents monopoly officially ended in 2004, and a second national operator and third mobile operator are to be licensed. Since the introduction of competition in the mobile sector in 1999, the number of mobile subscribers has grown dramatically, now representing more than 90% of all telephone lines. Senegal was one of the first African countries to introduce ADSL in 2003 which has almost completely replaced dial-up as an Internet access method. Overall market penetration is still low, resulting in attractive opportunities for new entrants. See Africa - Telecoms, Mobile and Broadband in Western Region for further information. Key highlights: Fixed-line, mobile and Internet market forecasting to 2010 and 2015 for Benin, Ghana, Nigeria and Senegal. The spectacular growth curve of Nigerias mobile market is slowly beginning to flatten, but US$2 billion in investments continue to flow into the countrys telecommunications market every year. Foreign investors, mainly from Europe, the Middle East and South Africa continue to expand their footprints in the region. The national telco, including its mobile business, and the electricity utilitys fibre network in Ghana will be privatised. ADSL has almost completely replaced dial-up as an Internet access method in Senegal. Cote dIvoire demonstrates how African telecoms markets are relatively unaffected by conflict. Cote dIvoire mobile subscribers and penetration rate 1996 - 2006 Year 1996 1997 1998 1999 Subscribers 13,600 36,000 91,200 257,100 Penetration 0.10% 0.26% 0.64% 1.8%
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2000 450,000 3.0% 2001 706,100 4.3% 2002 1, 030,700 6.3% 2003 1,239,200 7.5% 2004 1,671,400 9.9% 2005 2,347,000 13.4% 2006 4,077,000 23% (Source: BuddeComm based on ITU reports, Global Mobile, ATCI)
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North America:
This market continues its trend towards a triple play model during 2007 and early 2008. In particular, the telcos started making genuine strides towards their vision of triple play, by aggressively accelerating their deployment of optic fibre networks across their footprint. Their sense of urgency was highlighted by the rate of wireline losses; both Verizon and AT&T Inc posted fixed-line losses of around 10% for 2007. The main beneficiaries of the telcos significant churn rates, were the cable companies, whose VoIP services enjoyed rapid subscriber gains. The Internet economy continued its meteoric rise, with sites such as Facebook becoming $100 billion companies virtually overnight, highlighting the enormous scale of network economies that can be harnessed by the Internets expansive reach. Online advertising and e-commerce are becoming an increasingly significant share of the overall advertising and retail markets. Microsofts bid for Yahoo!, if successful, would give the merged entity, together with Google, a combined 50% of the $20 billion per annum online advertising market. See North America - Telecoms, Broadband and Mobile Statistics (tables only) for further information. Key highlights: During 2007 total revenue for the telecommunications industry grew by around 8% to reach over $1 trillion. Telecom service revenues reached $458 billion, of which wireless service revenue accounted for approximately 31%. The number of traditional fixed-line customers continued to drop sharply during 2007, with Verizon and AT&T both reporting declines of around 10% in residential wireline accounts. The growth in VoIP was a major contributor to this decline, in particular cable VoIP, with subscriber growth rates around 75%. Thus the RBOCs continued to focus on their fibre deployments in response to increasing competition from the MSOs VoIP and triple play offerings. State-by-state video franchising reform continued apace, thus facilitating the deployment by the RBOCs of IPTV on their expanding fibre networks. By late 2007 FttH deployments in the US were growing at over 110% per annum. Total broadband subscribers continued to grow solidly, although in terms of broadband penetration, the US continued to edge towards the bottom half of the OECD tables. Broadband DSL subscriber growth continued to outpace cable subscriber growth, though cable still leads in terms of market share. However, with the telcos aggressively deploying fibre networks, they will soon overtake the cable companies in terms of broadband market share. WiFi was becoming increasingly commonplace in the USA during 2007, with a burgeoning hotspot network, laptops being automatically equipped with WiFi cards and WiFi moving beyond the laptop; nevertheless doubts were being raised over the viability of municipal WiFi programs following the difficulties experienced in cities such as San Francisco, Chicago and Philadelphia. On the regulatory front, after a series of complaints were filed with the FCC by public interest groups, the Commission demonstrated some support for the principles of net neutrality in late 2007 by launching an inquiry into network management practices by broadband providers. The US wireless industry continued to enjoy considerable growth through 2007 reaching approximately 83% subscriber penetration by early 2008. Significantly, the percentage of wireless-only households exceeded, for the first time, the percentage of wireline-only households.
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The wireless industry was characterised in 2007 by a number of acquisitions by major carriers of smaller regional and rural carriers. The acquisitions are seen as a means by which major carriers can increase their subscriber numbers and network footprints as wireless penetration reaches saturation point. Wireless data revenues continued to enjoy strong growth in 2007, underpinned by robust wireless data revenue growth. Thus while overall voice ARPU decreased during the third quarter of 2007, data ARPU sustained a steady incline. By late 2007 data service revenues accounted for approximately 18% of total wireless service revenues, up from around 4% in 2004. Significantly, the majority of wireless data revenues were being generated by non-messaging applications and services such as music downloads, mobile TV, video blogs and Internet-accessed entertainment services. During 2007 the MVNO market witnessed a number of high-profile exits, causing a cloud of uncertainty to hang over the sector. A number of causes which may explain the trend include over-reliance on a content-focussed business-model and/or distribution issues with MVNOs failing to secure channel deals with large retailers. The selection of 4G wireless technologies became more compelling in late 2007, with Sprint Nextel on the verge of an extensive WiMAX deployment and Verizon Wireless announcing its decision to start LTE trials in late 2008. These open access platforms both offer significant scope for increased convergence among services and devices. In the broadcasting sector, with mandatory analogue switch-off scheduled in February 2009, the transition to digital TV gathered pace in 2007. This drove the growth of VoD services in particular. For instance, by 2007 it was estimated that approximately 45% of all cable subscribers utilised VoD. During 2007 the major satellite providers, DirecTV and the DISH Network, continued to make gains at cables expense, due in part to their competitive pricing plans and comparative advertising campaigns against their cable competitors. However, with the market moving towards a triple play model in the longer term, satellite will struggle to maintain these gains as it cannot match the cable companies broadband networks.
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Latin America:
The Latin American region is making giant strides forward in the telecoms market, particularly mobile telephony. There exists however a wide digital gap among the various nations, and indeed within each nation, due to the inequalities between rich and poor, and between urban and rural areas. See Latin America - Telecoms, Mobile and Broadband Overview and Latin America Mobile Statistics (tables only) for further information. Key highlights Latin Americas GDP grew by 5.0% in 2007, and is expected to grow by 4.3% in 2008. Despite a low 18% average teledensity, fixed-line growth in Latin America continues to stagnate. Broadband grew at an annual rate of around 40% in 2007, but broadband penetration at year-end was only 3.4%, considerably less than the global average of 5.9%. ADSL is the broadband leader, with a stable 71% market share virtually unchanged since 2005. Cable modem accounts for 26% of the market, and wireless broadband for the remaining 3%. WiMAX deployments continued in 2007 throughout Latin America, but frequency licensing in Brazil and Mexico was further delayed. Both countries are expected to hold WiMAX auctions in 2008. Latin America saw its first IPTV services in 2007. Telefnica Chile lunched IPTV in June 2007, Chiles Telsur in July 2007, and Brasil Telecom in September 2007. Other companies with plans to launch IPTV include Oi and Telesp in Brazil, UNE-EPM in Colombia, and CANTV in Venezuela. Disagreements continue over the choice of digital terrestrial TV standards. Any chance of reaching a common standard has evaporated, since Mexico and Honduras have adopted the USAs ATSC, Brazil has chosen the Japanese ISDB, and Uruguay has opted for Europes DVB standard. In early 2008, Latin America had 375 million mobile phones compared with 101 million fixed-line phones. Paraguay led the trend, with more than twelve mobile phones for every fixed line in service. Mobile penetration in Latin America and the Caribbean was over 66% in early 2008, well above the world average, which was around 46%. The regions share of the global mobile pie is around 12%, while it holds about 8.6% of the worlds population. 3G mobile services first reached Latin America in late 2006, launched by Cingular in Puerto Rico in November and by Entel PCS in Chile in December. Argentina and Uruguay came next, in mid-2007. By end-2007, all mobile operators in Chile, Argentina, and Uruguay were offering 3G services. Brazil saw its first 3G services in November 2007 and Mexico in February 2008. Amrica Mvil and Telefnica Mviles (jointly with Portugal Telecom in Brazil) serve around 65% of the regions mobile subscribers. In February 2007, the Venezuelan government moved to renationalise the countrys incumbent telco CANTV. It gained control of the operator in May 2007 with an 86.2% stake, which comprised 6.6% that it already owned; 28.5% that it purchased from Verizon; and 51.1% that it purchased through concurrent share offers on the New York and Caracas stock exchanges.
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The Bolivian government announced in April 2007 that the countrys fixed-line incumbent and mobile market leader Entel would be renationalised. Entels stakeholders were Telecom Italia (50%), the Bolivian government (47%), and Entel workers (3%). Negotiations between the Bolivian government and Telecom Italia however turned sour, and in early 2008, no conciliation was yet in sight.
Latin America Eastern Nations

The Eastern Nations consists of five nations that occupy the north-east and centre-east of South America, bordering the Atlantic Ocean and the Caribbean Sea except for Paraguay, which is land-locked. Guyana and Suriname share many characteristics with the Caribbean Nations, with which they are frequently associated. Brazil is a leading investment destination for international operators and suppliers, given its size and potential to develop into a top world market. The Eastern Nations of Latin America are considerably diverse. In size, they range from Brazil, the fifth largest country in the world, with a land area of 8.5 million sq km and 191 million people, to Suriname, the smallest country in South America, with 161 thousand sq km and half a million people. Economically, the countries are also vastly different. With the fourth largest oil reserves in the world, Venezuelas GDP per capita is one of the regions highest, while Guyanas is one of the lowest. Despite the huge differences in size and economy, mobile penetration is similar in all five countries. Fixed-to-mobile substitution is prevalent throughout the sub-region, led by Paraguay where mobile phones outnumber fixed lines in service by as much as twelve to one. This report presents a concise overview of sector liberalisation and privatisation among the Eastern nations of South America, government initiatives and regulations in the telecom industry, the development of product offerings for both mobile and broadband technologies, essential country and operator statistics in all telecom sectors, and the emergence of convergence and triple play. Key highlights The fixed-line market has been liberalised in Brazil and Venezuela; although the incumbents continue to dominate the fixed-line infrastructure in both countries, they are slowly losing market share to smaller operators. Guyana and Suriname are preparing for fixed-line liberalisation after years of failed attempts, while Paraguay continues to function in a monopolistic environment. Brazils fixed-line market has been privatised since 1998, while Venezuelas was privatised in 1991 and renationalised in 2007. Suriname and Paraguays incumbents are wholly state-owned. Guyanas incumbent telco has been privatised since 1991, but holds exclusivity over all fixed-line services. Mobile telephony is highly competitive in all five countries, with several operators offering services. Mobile penetration ranges from around 60% to 80%, and the mobile market continues to post double-digit growth. Prepaid cards have played a significant role in driving growth, making mobile phones accessible to many customers who do not meet credit requirements for postpaid services. Broadband penetration is low but on the rise, varying from about 4% in Brazil and 3% in Venezuela, to less than 0.5% in Suriname, Guyana, and Paraguay. There is good investment potential in this market. Triple play strategies combining voice, Internet, and video services have been adopted in Brazil and Venezuela, but the small markets of Suriname, Guyana, and Paraguay are still behind technologically.
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Latin America Central America

Central American consists of seven small countries, ranging in size from 20,720 sq km (El Salvador) to 120,254 sq km (Nicaragua), and in population from 311,000 people (Belize) to 13.3 million people Guatemala. Poverty is more widespread in these countries than in the rest of Latin America, and this is reflected in the development of telecommunications. Apart from Costa Rica, fixed-line teledensity in the Central American nations is lower than average for Latin America, while in mobile telephony, only El Salvador and Panama are slightly above the regional average. Nevertheless, all telecoms markets are growing. Investment opportunities are promising, and there is good scope for the testing of new technologies, particularly in the areas of wireless systems, mobile phones, and broadband. This report presents a concise overview of sector liberalisation and privatisation in the Central American sub-region, government initiatives and regulations in the telecom industry, the development of product offerings for both mobile and broadband technologies, essential country and operator statistics in all telecom sectors, and the emergence of convergence and triple play. See Latin America - Telecoms, Mobile and Broadband in Central America for further information. Key highlights Liberalisation of the fixed-line market is at different stages, from Guatemala, which has been open to competition since 1996, to Costa Rica, which remains a state-owned monopoly. Interestingly, we find that Costa Ricas fixed-line teledensity is one of the highest in Latin America and well beyond what could be expected given its other macroeconomic indicators. Teledensity in Guatemala, on the other hand, is about 40% lower than the overall Latin American average, which would indicate that fixed-line privatisation and competition are no guarantee of development in this market. Nevertheless, Guatemalas teledensity is no more and no less than would be expected given the countrys other macroeconomic indicators. Honduras has yet to privatise its telecom incumbent, and has only partially liberalised its fixed-line market. Differently from Costa Rica, teledensity is low, only slightly higher than would be expected considering Hondurass other macroeconomic indicators. Guatemala, El Salvador, and Panama have fully privatised and liberalised their fixed-line markets, and competition is growing, especially thanks to fixed-wireless deployments. Nicaragua and Belize have privatised their fixed-line incumbents. They have also theoretically liberalised their fixed-line sectors, but proper implementation has been delayed by political and legal wrangles. These countries present the worst case scenarios in Central America in terms of fixed-line development, since privatisation without liberalisation places a telecom incumbent in a position of hegemony where it can charge high prices and is under little pressure to improve services. Due to low fixed-line teledensity, the nations of Central America have leapfrogged directly into mobile communications. Mobile competition is keen, and penetration is far higher that would be expected considering their other macroeconomic indicators. Costa Rica is the only exception, and a colossal one, since it has a single state-owned mobile company, no prepaid cards, and an abysmally low mobile penetration compared with its relatively high GDP per capita. This is a good indication that mobile telephony thrives best in private hands and in a competitive environment. Costa Ricas mobile market, however, is in the process of liberalisation. With the start of competition and the introduction of prepaid plans, mobile telephony is expected to soar.
38 Broadband uptake varies greatly among these seven countries from a penetration of around 2.2% in Costa Rica, to less than 0.4% in Nicaragua and Honduras. In Panama, the country that is slated to be Latin Americas best performer in terms of economic growth, broadband penetration is only 0.6%, far lower than would be expected considering its GDP per capita. The provision of ADSL in Panama is dominated by the incumbent, but there is good scope for investment in alternative technologies. Despite the generally low telecoms indicators in Central America, these countries have witnessed some of the regions most advanced technological deployments, such as IPTV in Panama, High Definition TV in Honduras, and WiMAX in El Salvador. This phenomenon is partly due to the leapfrogging of conventional systems often found in developing countries, and partly due to the sharp social disparities, where certain urban areas, particularly in capital cities, enjoy first world telecom services, while rural areas lack even basic telephony.
Latin America Mexico and the Caribbean

The area consists of Mexico and the Caribbean, with the small island nations through to the larger countries of Cuba, Dominican Republic, Haiti, Jamaica, Mexico and Puerto Rico. Despite being relatively small markets by global standards, telecommunications has become one of the Caribbeans major growth industries. In particular, the regions mobile sector has been witnessing significant expansion in recent years. To date this growth has largely been harnessed by Mexicos Amrica Mvil and more recently by Digicel. These two companies are predicted to continue dominating the robust mobile sector growth during 2008/09. In contrast to the mobile sector, the fixed-line market remains relatively stagnant. While in a handful of countries Cable & Wireless still holds a monopoly in the fixed-line sector, a growing number of countries now have other operators offering fixed-line services at competitive prices. Investment in infrastructure during 2008/09 is expected to increasingly trend towards broadband access and associated IP services, such as VoIP. This report provides overviews, analyses and detailed statistics of the Mexican and Caribbean countries fixed-line, mobile and broadband markets including developments in emerging technologies such wireless broadband and VoIP. Key highlights: The Mexican telecom industry is forecast to continue its strong growth rates through 2008/09, following industry growth in 2007 at an estimated eight times higher than average real GDP growth rates. Growth during 2008 will continue to be fuelled by declining tariffs in the mobile and longdistance sector, and by increased deployment of broadband networks. For instance, mobile subscribers in Mexico grew by over 20% in 2007 and broadband lines continued to post even stronger gains of around 50%. Despite this strong growth, Mexico still suffers from a lack of competition. Although Telefnicas Movistar launched in 2002, Amrica Mvils Telcel still holds around 75% of the market. Indeed, concerns about the overall lack of competition and about certain monopolistic behaviour, compelled Mexicos antitrust agency to launch an investigation into the mobile and other telco markets in November 2007. Accordingly, 2008 may witness CFC rulings with important industry-wide implications. Mexican telecommunications growth for 2008/09 will receive further impetus from government reforms, given President Felipe Calderons recent statement that telecommunications is one of two key industries in which he intends to promote greater competition as part of his economic goals to 2012. This may lead to unbundling in Mexico
39 in 2008-2010, the last OECD country to unbundle its local loop. For more information, see chapter 6.2, page 97. The overall Caribbean mobile market has become one of the most dynamic markets in the world, with subscribers in the region increasing at an average annual growth rate of around 50% per annum between 2003 and 2007. As penetration rates are still relatively low, it is predicted that 2008 will continue to enjoy strong subscriber and revenue growth rates. For more information, see chapter 1.6, page 11. One of the star performers in terms of mobile growth has been the regions poorest country, Haiti. Haitian mobile subscriber numbers increased by nearly fivefold in the three years to early 2008. Growth has been stimulated by the entry of Digicel, which attained approximately 1.5 million subscribers (around 50% of the market) within 18 months of operation. For more information, see chapter 4.9, page 74. Carlos Slims Amrica Mvil continued its aggressive expansion in the region. It acquired, for instance, Verizons interests in the region, thus giving it control of the dominant Puerto Rico Telephone Company and of Verizon Dominicana (to be renamed Codetel) which dominates the Dominican Republics fixed-line market and holds around 50% of its mobile market. For more information, see chapter 3.4, page 52. Cubas telecom market, which has the lowest mobile and Internet penetration in Latin America, may be on the verge of liberalisation from 2008 following President Castros retirement in February 2008 and the imminent transfer of power to a more reform-minded successor.
Latin America Southern Cone

Argentina, Chile, and Uruguay are Latin Americas most prosperous countries, and this is reflected in the development of telecommunications. These nations are the regional leaders in a number of key indicators, such as standard of living, quality of life, adult literacy, teledensity, and Internet uptake. Argentina and Uruguay have the highest mobile penetration in Latin America, bar a few Caribbean islands, and Chile is the regions Internet and broadband leader. All three markets present good investment opportunities, particularly in the more advanced technologies such as 3G, convergence, IP-based communications, WiMAX, and digital TV. This report presents a concise overview of sector liberalisation and privatisation in the Southern Cone sub-region, government initiatives, and regulations in the telecom industry, the development of product offerings for fixed-line, mobile, broadband, and pay-TV technologies, essential country and operator statistics in all telecom sectors, and the emergence of convergence and triple play. Key highlights While Chile and Argentina have fully privatised and liberalised their telecoms markets, Uruguays local fixed-line sector remains a state-owned monopoly. Nevertheless, Uruguay enjoys the highest fixed-line teledensity in Latin America, and its other telecom markets are fully open to competition. The fixed-line sector in the Southern Cone suffers from fixed-mobile substitution. Argentina, with 23% teledensity, is the only country where fixed lines in service are growing, but only by 3% annually. Mobile telephony, on the other hand, has been soaring in the Southern Cone, especially in Uruguay, which had a late development in the mobile market. Competition between operators is keen in all three countries, and penetration has either reached or is close to reaching the 100% mark.
40 The broadband market has been booming, particularly in Chile, where penetration is the highest in Latin America. Argentinas penetration is the second highest, and Uruguay is not far behind. Although all three markets are open to competition, lack of local loop unbundling has given the incumbent operators a dominant position, particularly in Uruguay, where there is no cable modem broadband. All three countries have developed WiMAX networks. Telmex Chile launched Latin Americas first mobile WiMAX e service in October 2007. And all three countries have witnessed the launch of 3G mobile services Chile in December 2006, Argentina in May 2007, and Uruguay in July 2007. Convergence has had a different development in each one of the three countries. Chile is the regional leader, with VTR Latin Americas first triple player and several other companies all offering triple play packages. In Argentina, a telecom company must ally with a cable TV operator to offer converged services. And in Uruguay, cable TV companies are not allowed to offer either Internet or voice services, and have not been able to develop any convergence solutions. Telefnica Chile was the first company in Latin America to launch IPTV, in June 2007. Uruguays Antel hopes to launch IPTV services, but in Argentina, regulations prevent telcos from providing pay TV services.
Latin America Andean Bloc

This region consists of four nations that occupy the north-west and centre-west side of South America, bordering the Pacific Ocean except for Bolivia, which is land-locked. With a total land area of 3.8 million sq km and a population of 99.5 million, these countries are characterised by tropical lowlands, snow-capped mountains, and extremely ragged landscapes. The Andean Community of Nations Comunidad Andina de Naciones (CAN) is a trade bloc comprising Bolivia, Colombia, Ecuador, and Peru. CANs membership decreased from six to four countries following the withdrawal of Chile in 1976, and of Venezuela in 2006. Founded in 1969, the trade bloc was called the Andean Pact until 1996. CANs headquarters are in Lima, Peru. Bolivia, Colombia, Ecuador, and Peru are among the poorest countries in South America, with the worst macroeconomic indicators in the region. Fixed-line teledensity is limited throughout the Andes by the low population density and the rough mountainous landscapes, which hinder the laying of copper wire. Bolivia has South Americas lowest mobile penetration and second lowest fixed line teledensity. On the upside, there is considerable room for growth in all four markets, and good investment opportunities, particularly in alternative technologies suited to the areas rugged terrain. Key highlights The fixed-line market has been liberalised in all four nations. Apart from Peru, which has one fixed line incumbent that dominates the last mile, the other countries have several regional operators Bolivia has 15 local telephone cooperatives, and Colombia has around 30 local providers that operate municipally, regionally, or nationally. Long distance telephony is extremely competitive in all four markets. VoIP telephony has been adopted by a number of operators and is available through Internet cafs and telecentres. Due to the poor fixed-line teledensity, mobility has become the chosen alternative in the Andean countries, leading to a ratio of around 4.5 mobile phones for every fixed-line in service. Prepaid cards have played a significant role in driving growth, making mobile phones accessible to many customers who do not meet credit requirements for postpaid services.
41 Besides mobile telephony, operators have been using various wireless and satellite technologies to reach isolated communities. WiMAX has become the future hope for this region, and the first WiMAX or pre-WiMAX networks have been deployed in all four countries. Broadband uptake is below the South American average, varying from about 2% in Peru and Colombia, to 0.1% and 0.6% in Bolivia and Ecuador respectively. ADSL is the leading technology by far. In Colombia, however, cable modem is strong and WiMAX has gained a 5% market share. Triple play strategies combining telephone, broadband, and pay TV services have been adopted or are being rolled out in all four markets. Colombia is the most advanced of the four in the area of convergence, with several major players offering triple play service, while the Peruvian government has created a single licensing system in the hope of encouraging convergence.
Asia-Pacific: China
The Chinese telecommunications market is the largest in the world. With the mobile sector still expanding at over 18% going into 2008, the long-awaited licensing of 3G services is getting closer and will surely give the market yet another boost. There continues to be a major need for industry restructuring and government action is expected in conjunction with the issuing of 3G licences. Telecommunications development figures prominently in the nations priority scheme as China readies itself for the 2008 Beijing Olympics. The Chinese telecom market is serviced by six main operators: China Telecom, China Netcom, China Mobile, China Tietong (formerly China Railcom), China Satcom and China Unicom. State agencies have been discussing possible mergers among the operators as part of the industry restructuring. In the past five years, as one of the countrys pillar industry, Chinas telecom service industry has grown at a faster rate than the countrys GDP. According to official statistics from the Ministry Information of Industry, revenue from basic telecom service contributes approximately 2.1% of the countrys GDP, while value-added telecom services contribute a further 3.2% to total GDP. By the end of 2007, mobile penetration in China stood at 41.4%, following a record level of subscriber additions during the year. The robust growth was due to an expanding rural market and the increasing number of people who have acquired more than one mobile phone. Both China Mobile and China Unicom have invested considerably in network improvements, especially in rural China, where approximately 750 million of Chinas population resides and teledensity is just 12%. For many of Chinas tech-savvy citizens, the mobile phone is becoming the preferred means of using the Internet. The number of people who access the Internet through their mobile phone surged to 50 million in 2007 from 17 million at the end of 2006, about a quarter of Chinas Internet users. Since the implementation of one-way charging implemented nationwide in the middle of 2007, the substitution of fixed-line services by mobile networks has accelerated. While China Mobile and China Unicom added over 86 million users, or roughly 7 million a month, the fixed-line customer base shrank by 2.3 million to around 365 million, a penetration of 27.8%. By February 2008, the number of mobile phone users reached 565 million, exceeding the fixedline subscription base of 362 million. Looking ahead, total mobile subscriber numbers are forecast to pass 600 million in 2008, but crucially market penetration will remain below 50%, meaning the Chinese market still has a lot of untapped potential. China became the second largest broadband market in the world after the US in 2004, after it had passed Japan earlier in that year and South Korea in 2003. Falling equipment prices, low service tariffs and strong consumer demand for services such as online gaming and file sharing have been some of the reasons behind the impressive growth of broadband. There is little doubt that China will soon pass the US to become the worlds top broadband market. According to the annual survey conducted by China Internet Network Information Centre,
42 going into 2008, Internet users stood at 210 million, over 75% using broadband for Internet access. For further information, see Asia - Telecoms, Mobile and Broadband in China Key highlights: The number of Chinas telecommunication users reached more than 900 million in 2007, including around 365 million fixed lines and 545 million mobile users. This makes it the first country in the world to do so. Against a background of rising consumer prices in 2007, telecommunication charges fell 13.6% year-on-year. By end-2007, close to 75% of Chinas 210 million Internet users were from urban areas. Urban subscribers reached 157 million representing an urban penetration rate of 27.3%. This was well above rural subscribers of 52.6 million giving a rural penetration rate of 7.5%. Over the next five years, it is estimated that the number of Internet users in China will grow at a compounded annual rate of 18.5%, while the US will grow at only 2.2%. By 2012, that would give China 590 million Internet users. Going into 2008, China had about a 16% Internet penetration rate compared with the world standard 19.1% and the USs 69.7%. The rise in broadband lines to over 66 million was accompanied by a significant fall in the cost of Internet connections. The average connection cost fell to less than 75 yuan per month at the end of 2007, however a World Bank report released in May 2007 highlights that this is more than 10% of the Chinese average monthly income. In developed countries people spend an average of less than 1% of their income to access the same information online. China Internet consumption in 2007 was 398.8 billion yuan and is expected to grow 45.8% in 2008. Online shopping reached US$8.2 billion, up more than 90% from 2006. Of Chinas 210 million Internet users, 55 million shopped online in 2007. Online sales, which accounted for less than 1% of Chinas total retail sales, are forecast to make up 5-8% of total retail sales by 2012. Sales of online games in China topped US$1.45 billion in 2007, up 61.5%. It is estimated that Chinas online gaming population will hit 84.56 million by 2012 from 40 million in 2007. The transaction volume of Chinas online business-to-business jumped 65.9% year on year to 2.1 trillion yuan (US$292 billion) in 2007. Revenues drawn from online B2B operations are expected to jump to 13.8 billion yuan (US$1.8 billion) in 2011 from 76 billion yuan (US$10.6 billion) in 2002. For more information, see chapter 6.4.3.2, page 90. Chinas online advertising market revenue reached US$1.3 billion in 2007, while US Internet advertising spending reached around US$21.4 billion in the same period. The Internet makes up only about 5% of advertising spending in China compared with 10% in the US. For more information, see chapter 6.4.3.2.6, page 94. By end-2007, China Netcom and China Telecom between them, had over 1.2 million IPTV subscribers. Shanghai had 300,000 IPTV subscribers by March 2008, the highest in the country. By early 2008, 68 cities had completed digital cable TV conversion, with the penetration rate of digital cable TV reaching 24.33%. For more information, see chapter 7.3.2, page 122. Early in 2007 China ramped up the number of cities trialling its home grown 3G standard, TD-SCDMA, to 10. After initial reports in May 2007 that China was expected to invest at least RMB4 billion (US$519 million) buying TD-SCDMA handsets, in early 2008 China Mobile started selling heavily subsidised TD-SCDMA phones in eight cities. Officially it is
43 a trial, because 3G licences have not yet been issued. According to the International Olympic Committee, the inability to offer a widely-supported 3G network was the only infrastructure target that Beijing failed to meet. The calling-party-pays billing policy for mobile phones, under discussion from before 2001, was finally implemented during 2007.
Asia-Pacific Hong Kong and MacauError! Bookmark not defined.

Hong Kong, a Special Administrative Region (SAR) of China, takes pride in the way it has built one of the most sophisticated telecommunications markets in the world. Hong Kongs regulator, the Office of the Telecommunications Authority, has played a major role in developing the telecom sector. The country has put in place substantial infrastructure which supports one of the worlds highest penetrations of mobile phones and telephone services. By early 2008, the territory had more than 3.8 million fixed telephone lines in service, giving a 95% fixed-line household penetration rate and 53% fixed-line population penetration rate, among the highest in Asia as well as in the world. As a result of open competition in the local FTNS market and governments withdrawal of its mandatory Type II interconnection policy, over 80% of residential households are able to enjoy an alternative choice of local fixed network operators. Furthermore, PCCW has a universal service obligation to provide a continuous basic service, including the provision of public switched voice telephone services anywhere in Hong Kong in a reasonable period of time. Hong Kong has moved quickly in providing around 75% of all households with access to broadband connectivity. This has been accompanied by rapid growth in the Internet market. Broadband Internet subscriptions well and truly surpassed dial-up subscriptions by end-2005. There were in excess of 4.8 million Internet users in the territory, gaining access using either dial-up or broadband, going into 2008. The number of broadband subscribers represented about 67% of the total Internet subscriber base, supported by a large number of ISPs. By December 2007, according to OFTA, Hong Kongs Internet subscriber base consisted of 1.88 million broadband subscribers and 960,000 dial-up subscribers. Broadband ARPU levels were increasing, as operators benefited from lower churn and higher revenue due to good quality content. Going into 2008, based on OFTA data, there were an amazing 10.588 million mobile subscribers, representing an impressive penetration of over 152%. This included over 2.7 million 2.5G and 3G subscribers. This penetration level puts Hong Kong in a tussle with Macau for first place in the Asian mobile market (both now well ahead of previous leader, Taiwan). This is remarkable considering that Hong Kong not only has the highest density of fixed telephone lines in the region but also that local calls on the fixed network are free. An ongoing price war cut mobile phone air-time rates to levels where operators became increasingly reliant on provision of non-voice value-added services to maintain margins; this, in turn, made 2.5G and 3G services of considerable importance. Macau, a SAR of China, remains very low profile compared with its bustling sister SAR, Hong Kong. It has however quietly built itself a strong modern telecoms infrastructure. While fixed lines reached an effective saturation point a few years ago, the countrys mobile market has been growing strongly and had become one of the most highly penetrated in the world - 151% by the start of 2008. Macau has been busy adopting the Internet and by January 2008, over 94% of all Internet subscriptions were broadband based, mainly using DSL. See Asia - Telecoms, Mobile and Broadband in Hong Kong and Macau for further information. Key highlights: In October 2007 OFTA awarded a 15-year licence to PCCW for the CDMA2000 licence in the 850MHz band. PCCW can provide CDMA 2000 services after 20 November 2008, and will construct the new network during the intervening period.
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After being awarded a 3G licence for WCDMA in 2006, in October 2007 Hutchison (Macau) launched its 3G network deploying WCDMA technology to roll out a 3.6Mb/s HSDPA broadband network. For more information, see chapter 2.10.3.2, page 102. In June 2007 China Unicom won a licence to provide services based on the alternative 3G standard CDMA2000 1x EV-DO. The company launched its 3G network in Macau in October 2007. In November 2007 HKBN began deploying what it claims to be Hong Kongs first Gigabit Passive Optical Network. HKBN claimed it had turned traditionally cost prohibitive FttH technology into affordable mass-deployed residential service at a HK$48.50 service fee for its 100Mb/s service, progressing to HK$215 1Gb/s. In December 2007 the Telecommunications Authority announced the decision to auction spectrum for the provision of broadband wireless access services in the 2.3-2.4GHz and the 2.5-2.69GHz band by October 2008. Operators are expected to launch services in 2009. In a densely packed market that has an estimated 2.3 million TV households, PCCW ended 2007 with 882,000 video subscribers in Hong Kong with a paying base of 628,000. That still put it within striking range of i-Cable, which closed 2007 with 882,000 video subscribers. Besides losing its historic market share edge, i-Cable may also start shedding subscribers. This has PCCW stealing away cable customers in a highly competitive market considered one of the most mature and saturated in the world.
Asia-Pacific Indonesia and Timor Leste

Indonesia Indonesia continues to see its telecommunications sector grow, despite the occasional setback. The country of around 250 million people is obviously a huge potential market; however, it has some particularly big challenges to confront in building the necessary telecommunications infrastructure to cover a uniquely complex geography. At the same time, the nation has had to deal with a range of social, political and economic issues that have been proving problematic. The government has been gradually reshaping the telecom industry, a process that took on a new impetus following the Asian economic crisis of the late 1990s. In more recent times, Indonesia has been experiencing healthy sustained growth in subscriber numbers and revenues. While fixed-line teledensity remains disconcertingly low (just over 8% in early 2008), the advent of fixed wireless services has boosted the growth rate in the last few years and provided much-needed basic telephone services to previously unserved communities. The roll-out of fixed wireless infrastructure has been well supported by the operators with Bakrie Telecom and PT Telkom leading the way. Although the statistics were somewhat imprecise, by end-2007 fixed wireless services made up about half the total fixed-line subscriber base. In the meantime, Indonesias mobile market continues to grow, expanding at an annual rate of close to 50%. By early 2008 the total mobile subscriber base had passed 90 million, up from 12 million just six years earlier. While the countrys mobile penetration was suddenly approaching 40%, the industry view was that there was still considerable potential for further growth in the market. It was expected that the milestone of 120 million mobile subscribers would be reached by end-2008. At the same time market interest started to focus on the 3G services already being offered by five operators. Telkomsel was indeed making its presence felt in the market, claiming about 80% of the five million 3G subscribers at end-2007. The number of Internet users in Indonesia was estimated at more than 25 million by early 2008, representing a relatively low penetration of 10%. The Internet subscription market was generally depressed with less than 4 million subscribers reported in early 2008. Broadband
45 Internet access was virtually non-existent. While the government was continuing to promote greater use of online services, these efforts appeared to have little impact. In a move that some observers felt could have a negative impact on investment in the countrys telecom sector, Indonesias competition watchdog, the KPPU, announced in May 2007 that there was evidence of cross-ownership of Indosat and Telkomsel that was violating the countrys anti-monopoly laws. The KPPU alleged that the cross-ownership by Singapores state-owned holding company Temasek in two of Indonesias mobile operators violated the 1999 anti-monopoly law. At the time, Temasek owned a 56% stake in Singapore Telecom, which had a 35% stake in PT Telkomsel. Temaseks wholly-owned Singapore Technologies Telemedia controlled 75% of Asia Mobile Holdings, a company that owned 40% of PT Indosat. Together, PT Telkomsel and PT Indosat controlled more than 80% of the domestic mobile market. The issue subsequently underwent a process of resolution by the courts. By June 2008, the parties were waiting on a decision by the Supreme Court, after Temasek appealed a lower courts adverse ruling. Timor Leste (formerly East Timor) The political instability and outbreaks of civil unrest that erupted in Timor Leste in April/May 2006 continued into the first half of 2007. Despite the election of a new government led by Nobel Peace Laureate Jose Ramos Horta in May/June 2007 opposition to the administration caused further outbreaks of violence and looting. To the outside observer, the country appeared to have started reasonably well in rebuilding its entire infrastructure following the turbulence that ensued after the referendum of 1999. However, the events of 2006/07 caused major concerns about the direction of the Timor Leste; it remained difficult to assess the long term impact of these events on the countrys fragile economy and the process of infrastructure building. Then, in February 2008 President Ramos Horta was shot and severely wounded in an attack led by rebel Alfredo Reinado (who was allegedly involved in the unrest of April/May 2006). A short time later a convoy including Prime Minister Gusmao was fired upon. The Prime Minister was uninjured. Responding to the attacks, the government declared a state of emergency. President Ramos-Horta returned in April 2008, after receiving medical treatment in Australia. The state of emergency ended in May 2008, following the surrender of most of the rebels. In the meantime, throughout this difficult political period, the countrys mobile sector was experiencing strong growth (over 50% in 2006; just on 50% in 2007), with mobile penetration reaching a low, but nonetheless significant, 7% milestone by end-2007. Fixed-line network expansion was generally languishing coming into 2008, with teledensity down around 0.3%. Although it was difficult to get accurate figures on the Internet market, it was evident that growth in this sector remained constricted and there was little optimism about online activity in the short term. It is noted that Timor Leste has finally been listed as a member of the ITU. While the ITU does provide some information on this market, it has continued to be a difficult task to obtain official statistics for the countrys telecom sector. Where official statistics are not available, BuddeComm will normally provide an estimate. For further information, see Asia - Telecoms, Mobile and Broadband in Indonesia and Timor Leste Key highlights: Indonesias mobile market passed 90 million subscribers in early 2008 with penetration running at about 37%. After more than seven straight years of strong growth, the annual increase in mobile subscribers was almost 50%.
46 Indonesias 3G market was still in its infancy two years after launch, with 3G subscribers representing only about 4% of the total mobile subscriber base. Mobile market leader Telkomsel had made a big impact on the still small 3G market with 80% of the five million subscribers coming into 2008. Internet penetration remained low (10% user penetration by end-2007) and Internet subscription rates were considerably lower. Broadband Internet access numbers in Indonesia were starting to grow, but penetration remained low (0.1%). The year 2007 again proved positive for Timor Lestes mobile market, with growth surging by almost 50% for the second consecutive year; penetration had reached 7% by early 2008. On the broader scene, however, the ongoing political and civil unrest in the country continued into 2008 and was a major distraction for government, providing a serious disruption to development programs and infrastructure building.
Asia-Pacific - JapanError! Bookmark not defined.

Japans telecommunications sector is one of the most active markets in the world. The telecommunications regulatory authorities in Japan have been instrumental in shaping the industry and as a result, Japan has assumed a dynamic leadership role in many aspects of global and regional telecommunications. The control that the incumbent operator, NTT Corp, has continued to exert over virtually all local customers remains a particular challenge for the regulator. In addition, a growing concern has been the development (and lack) of cyber law in a society that is increasingly spending its time online. Japan has been an early adopter of triple play models which provide TV, broadband Internet and voice telephony as packaged services from a single provider. This has been enabled through Japan being a world leader in broadband Internet. Though there is little hope of surpassing the US and China in terms of numbers; the market in Japan remains as eager as ever for broadband connection to the Internet. Japanese broadband subscribers comprised around 8.5% of the world subscriber base going into 2008. Coming into 2008, the country was witnessing the continued growth of VoIP and triple-play services in particular. Strong competition was also apparent among the mobile operators in the 3G segment of the market. Especially noteworthy has been the uptake of FttH services (with a corresponding move away from DSL) and the big strides taken in developing digital and mobile broadcasting. Japan is one of the worlds leading mobile telephone markets, not only in terms of size but also in terms of innovation and its ability to be early with the introduction of advanced technologies. Japan is one of the worlds top 3G markets, with over 80 million (80%) 3G subscribers by the end of 2007, as well as plans for 4G. See Asia - Telecoms, Mobile and Broadband in Japan for further information. Key Highlights: The number of broadband lines in Japan has posted dramatic growth, more than tripling in size over the four years to March 2007. In terms of quality and affordability, Japans telecommunications infrastructure is significantly ahead of those in the US and Europe. Going into 2008, DSL subscribers were declining from the peak in 2006, as customers continued to shift to FttH. The DSL and FttH platforms support the bulk of the countrys broadband market, with other technologies such as cable modem and wireless making up less than 10% of the total market.
47 During 2007, the number of fixed subscribers declined below 50 million (less than 40% penetration), and that of mobile subscribers surpassed 100 million (just less than 80% penetration). This trend highlights the severe pressure that NTT is experiencing, faced with declining fixed-line subscribers, and high levels of competition and low price plans eating away at the mobile market dominance. The local markets other significant growth area coming into 2008 was in IP based telephony, taking up more than 10% of all telephony subscriptions. Here Softbank is a major player, with 30% of the total VoIP subscriber base by September 2007, although NTT showed considerable increases during 2007 to obtain over 50% market share 3G accounts for almost 80% of the mobile market in Japan, providing a strong base for the development of richer content. DoCoMo has introduced HSDPA and plans to offer HSUPA in 2008. The company is also one of the strongest drivers of the Long-Term Evolution standard, and is expected to launch around 2009/10 before the standard is complete. NTT DoCoMo became the first mobile operator, in December 2007, to adopt an MIC panel recommendation, to stop subsidising mobile phone prices through rebates. Other operators showed reluctance due to concerns that handset sales could decline, resulting in the possible closure of retail outlets. EMobile launched its 3G service in October 2007 and by end January 2008 the operator had 238,500 subscribers. The plan to offer voice telephony services were, however, put in jeopardy as a result of difficult and protracted negotiations with DoCoMo on a roaming deal. IPMobile was awarded a licence restricted to 2.0GHz bandwidth in November 2005. After investing over US$426 million, in 2007 IPMobile abandoned its plans to enter the mobile market due to financial difficulties. The company returned its 3G mobile licence and filed for bankruptcy with the Tokyo District Court. The Radio Regulatory Council awarded licences to KDDI and PHS operator Willcom in December 2007. KDDI plans to introduce WiMAX in 2009, while Willcom hopes to launch its own high speed service, also in 2009, using next generation PHS technology. Popular valued added services continue to be i-mode for Internet access via mobile phones, music downloads facilitated by linkage between the content providers and the operators, and Osaifu-Keitai which is a mobile wallet allowing subscribers to pay for train tickets and the like with their mobile phones. Out of NTT DoCoMos 53 million subscribers by September 2007, nearly 48 million used the i-mode service and 27 million the mobile wallet, an increase of 100% for the latter over the previous year. Japanese subscribers are well accustomed to accepting rich content advertising messages. Mobile operators establish their own mobile advertising agencies to support operators business models for mobile advertisements. By 2012, the total value of all mobile advertising and marketing is expected to reach US$1.2 billion in Japan. For more information, see chapter 9, page 108. In March 2008 US brand Walt Disney launched as an MVNO on Softbanks network. MVNOs are common outside Japan, though they have had mixed results. Disney last year hung up on an MVNO in the US that used Sprint Nextel Corps network, and in 2006 discontinued a similar service based on its ESPN sports TV network.
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Asia-Pacific Malaysia and Philippines

Malaysia Malaysia has developed one of the more advanced telecom environments in the developing world. For a period in the 1990s the country was busily promoting itself as a regional high technology hub, but in recent times it has adopted a quieter profile and has set about the task of steadily building a technologically progressive economy. While still in an expansion phase the Malaysias telecom sector has undergone a period of consolidation with telecom companies doing battle in an increasingly competitive and changing market. The last decade has seen healthy overall growth in the countrys telecom sector. Coming into 2008 just over 90% of the 27 million people in Malaysia had a mobile telephone service. This gave Malaysia the second highest mobile penetration in South East Asia after Singapore. The 25 million mobile subscriber milestone is set to be passed in 2008, up from only two million in 1998. Malaysias mobile market had made a remarkable recovery after suffering a serious setback; having reached annual growth levels in excess of 50% by the mid-1990s, growth dropped sharply coming into 1998 as the impact of the Asian economic crisis was felt. However, the market quickly recovered. Following the example set by the Philippines, Malaysias mobile users have also been enthusiastic in their adoption of SMS, with the regulator reporting that Malaysians sent more than 10 billion SMS during 2006. By contrast, growth of fixed-line services has been far more modest, especially in recent times. Having moved rapidly from around 2 million in 1990 to 4.7 million in 2002 (almost 20% penetration), fixed-line subscribers dipped to 4.35 million (just under 16% penetration) by the start of 2008. Internet take-up in Malaysia has been surprisingly restrained, with broadband growth in particular being disappointing. However, over the last few years, the broadband Internet market finally started to experience a major surge. During 2006-07 there was close to 200% expansion, lifting penetration to 5%, from only 1% at end-2004. Coming into 2008 the market, which is dominated by services based on DSL technology, was expanding at an annual rate of more than 50%, passing the 1.5 million subscriber mark (or around 16% household penetration). Malaysia, however, remains well behind the regional leaders where broadband household penetration is typically running at above 50%. Malaysia has also been continuing to develop its multi-billion dollar Multimedia Super Corridor (MSC) project. Although the project has become much lower key than previously, the government says it has been meeting its MSC targets, with more than 2,000 companies involved by June 2008; R&D investment to date totalled more RM814 million. The Philippines Despite considerable effort over the last decade or so, the Philippine government, working with the countrys telecom operators, has not succeeded in its efforts to extend the basic fixed-line telephone network to reach the wider population. Fixed-line teledensity stands at less than 5%; only a little more than half of all Philippine towns and cities have a telephone service. A fixed-line teledensity of 12% by 2002 was the original target set for the government as part of its Service Area Scheme (SAS). The plan fell well short of target and since then fixed-line penetration has remained relatively static. The mobile market has been a totally different story. No doubt contributing to the problems experienced in the fixed-line sector, the Philippines has witnessed a strong focus on and a rapid take-up of mobile services. Penetration has grown quickly to reach 60% (55 million subscribers) by early 2008. The continued growth has confounded the market; there have been times when the sector looked to have reached a plateau, but then it found a new ways to grow. Of particular note has been the remarkably high national usage of SMS. The mobile phone has captured the imagination of the population; not surprisingly, mobiles have well and truly overwhelmed fixed-line services. A large proportion of the recent growth has also been
49 coming from outside the main city of Manila, with the big operators, Globe and Smart, vigorously competing for lower income segments of the population by offering a range of cheap prepaid products. Further mobile growth will depend on pricing and marketing strategies of the operators, and, most importantly, the growth level in the overall economy. Growth is expected to ease over 2008-2010, with mobile penetration only expected to rise to about 75% (about 15 million new subscribers) over that period. The Philippines has been lagging badly in its roll-out of Internet and broadband services. 2006 saw the start of a significant surge in broadband uptake, with an estimated 340,000 subscribers by year-end, rising to almost 1 million in mid-2007, providing a much needed boost to a market where over half the users are still accessing the Internet at cyber cafes and other such venues. The jump followed the expansion of PLDTs SmartBro service, a wireless broadband product similar to WiBro in South Korea. Despite the fresh new growth, overall broadband penetration remains low; there were only 11 broadband services for every 1,000 people in the country early in 2008. The Philippine telecoms and IT market continues to exude considerable optimism despite the ups and downs; the sector has been contributing more than 10% to the countrys GDP, obviously being given a massive boost by the mobile segment. See Asia - Telecoms, Mobile and Broadband in Malaysia and Philippines for further information. Key highlights: Over 90% of Malaysians had a mobile telephone service by early 2008. The launch of 3G mobile networks by Telekom Malaysia and Maxis in late 2005 saw a total of almost 1 million subscribers signed up for new generation services by end-2007. While 3G numbers were growing quickly they still only represented 4% of the total mobile subscriber base, leaving plenty more room for growth. After surprisingly little interest in broadband Internet for many years, broadband penetration in Malaysia has finally started to grow up by 50% in 2007; Broadband subscribers in Malaysia represented only 5% of the population at end-2007. Growth in fixed-line services has continued to flat-line with penetration of only about 16%. The MSC project continues to grow, with more than 2,000 companies signed up by June 2007. The mobile market in the Philippines managed to grow another 20% in 2007, on top of 30% in 2006, with subscribers continuing to increase through 2008 despite expectations that the market was saturating. Mobile penetration reached almost 60% by early 2008; Broadband Internet access finally started to grow in 2006, continuing into 2007 with a massive surge of almost 200% over the year, but this was still only 4% of the population. The fixed-line market continued to be a problem for the Philippines; fixed teledensity stands at less than 5% with no sign of increased expansion in sight. The Philippines telecom sector continues to contribute over 10% to the countrys GDP.
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Asia-Pacific Myanmar and Thailand

The neighbouring countries of Thailand and Myanmar continue to provide an interesting contrast. Similar in both population size and land area, the two countries have been developing along totally different economic paths. Thailand, a constitutional monarchy, which has certainly been struggling with its democratic processes and institutions, has nonetheless been able to offer an essentially open market. On the other hand we have Myanmar operating as it has under a repressive military dictatorship for many years now and presenting a market that remains totally closed and centrally controlled. GDP per capita in Thailand is running at around US$4,000; in Myanmar it is less than US$250. The development of their respective telecom sectors reflects the same divide. In mobile and Internet penetrations Thailand leaves Myanmar far behind. Even in basic fixed-line telephone services, a segment of the market that the Thais have not given any priority, Myanmar is continuing to lag far behind Thailand. The overthrow of the Thailands Shinawatra government in a military coup in September 2006 was followed by a period of government by a military-appointed administration; happily this interim period ended without too much pain and certainly no further militarily intervention when general elections were held in late 2007 and a new government was installed. As the country continued its search for increased politically stability, there can be no doubt that the upheaval over the last few years has had considerable negative impact on (1) the Thai economy, (2) the administration of the country and (3) investor confidence. The telecom sector witnessed the appointment by the post-coup government of a Minister for Information and Communication Technology who, at least initially, took a policy position that was essentially against what were seen as Thaksin Shinawatras telecom reforms. The new minister, for example, wanted to roll back the process of privatisation of the two state-owned telcos, TOT and CAT; further to this, he wanted to restore some of their regulatory powers. While generally seen within the industry as a rather regressive administration, some positive reforms did emerge during this period. Despite all the difficulties, Thailands telecom sector has continued to display a surprising amount of energy. The countrys mobile telephone market in particular has recorded strong annual growth rates, the recent high level of growth taking the industry by surprise. By early 2008, mobile penetration was around 82%. In a matter of only six years, the mobile market had moved from 8 million in 2001 to 53 million in 2007. Apart from the booming mobile sector, the Internet is an area of the Thai market that has also been popular at least in its dial-up form. Oddly, the development of broadband Internet has been languishing. It was not until 2005 that the number of broadband subscribers started to move in any serious fashion. A reasonably strong growth trend has continued since then and by end-2007 there were around 1 million broadband subscribers in the country. Broadband penetration was still under 2%, however. Thailand has certainly been seeing the benefits of a liberalised market with the highly competitive mobile sector being the big beneficiary. Nevertheless, sectoral reform remains unfinished business. It took four years after the enabling Telecommunications Act was adopted as law in 2000 for the countrys new regulator, the National Telecommunications Commission, to be put in place. And once it became operational, the NTC had to contend with the volatile political environment following the 2006 coup, again throwing uncertainty over the regulators role. Even with a newly-elected government in place in early 2008 the future direction for the regulator was not exactly clear. Myanmars telecom sector continues to be dominated by the state-owned monopoly telephone service provider, Myanmar Posts and Telecommunications (MPT). This ministrys form has indeed been consistent with the overall operating environment of an economy where change is simply slow. The country has been battling both economic problems and a troubled political climate. Soaring inflation remains a major problem (34% in 2007). The countrys centrally planned economy is plagued by weak fiscal and monetary management, resulting in major economic imbalances, which are not likely to be easily or quickly resolved.
51 These problems, combined with a disturbing lack of transparency, have not surprisingly frightened off foreign investment. In the meantime, the telecom sector is characterised by what can only be described as stunted growth. In fact, following the political and social upheaval of late 2007 subscriber data reports suggested that things were actually going backwards. The telecom sector reflects the overall state of the national economy and society. It should also be noted that Myanmars official economic data is not considered reliable, making actual growth rates difficult to ascertain. Nevertheless, it is reasonable to assume that fixed-line telephone penetration remains at or below 1%; the penetration of mobile services is even less than that; and Internet access continues to be severely restricted in its availability to the general public. At the same time, given the state of the economy and the absence of serious foreign investment, the MPTs level of capital investment in telecoms infrastructure has been depressingly low. To cap this off, the country suffered a devastating cyclone in May 2008 resulting in a huge loss of life and massive damage to the countrys fragile infrastructure. See Asia - Telecoms, Mobile and Broadband in Myanmar and Thailand for further information. Key highlights: Thailands mobile market had reached 53 million subscribers by end-2007. After more than seven straight years of strong growth, the annual increase in the mobile subscribers was still running at over 30% coming into 2008. The broadband Internet market in Thailand saw another year of vigorous subscriber growth in 2007, running at an annual rate of around 60% with all the signs suggesting that this would continue through 2008. While interest in broadband services was finally picking up in Thailand, it was happening from a relatively small base; overall broadband penetration remained low (under 2%). Despite a slowing in economic growth following the September 2006 coup, the post-coup government, after a number of missteps, worked hard to stimulate the economy, looking to such initiatives as free trade agreements. Then in December 2007 a newly-elected government committed itself to the task of getting the country back on track. Myanmars mobile market, after reportedly growing at an annual rate in excess of 100% in 2006, managed another healthy expansion in 2007 with a 40% jump in subscribers. Of course, this growth was from a low subscriber base in the first place up from 126,000 subscribers (0.3% penetration) in 2005 to 325,000 (0.7%) in 2007. With information on growth patterns being difficult to obtain, one source suggested that mobile subscriber numbers had in fact declined from a mid-2007 peak. From totally different perspectives Thailand and Myanmar must both seriously address regulatory reform; Thailand needs to work to get fresh momentum in its stalled reform processes; Myanmar needs to get some sort of reform process started. The latter has a lot further to travel in this regard.
52
Asia-Pacific North and South KoreaError! Bookmark not defined.

South Korea has one of the most vibrant and interesting telecommunications markets in the world. Supported by a visionary government program of stimulating development through liberalisation, deregulation and early privatisation of the incumbent, a creative and energetic private sector and a technology savvy population, the Republic of Korea continues to push forward on this front. Loans were given and licences awarded to alternative operators to build networks and increase penetration. To foster a knowledge-based society, a major government education initiative provides Internet education to all segments of the population. Electronic commerce is common in private and public sectors. Of particular interest are the developments in the broadband market including market interest in VDSL, the shift away from DSL, the move to ALAN and FttH services, the development of mobile DMB services and the launch of WiBro services. Around 90% of South Koreans have at least one mobile phone. South Korea is considered a leader in 3G mobile technology and has the worlds highest percentage of mobile users on 3G. By 2007 the introduction of the faster HSDPA platform was making these services more attractive and the 3G market received a real boost as a result; this lead to the introduction of HSUPA. South Korea has the worlds highest number of broadband services per capita. By early 2008, around 30% of the population, or 90% of households, were broadband subscribers. South Korea is an early adopter of triple play models, which provide TV, broadband Internet and voice telephony as packaged services from a single provider. The fixed-line telephone market in South Korea continues to be dominated by the incumbent KT Corp. The three main mobile operators are SK Telecom, KTF and LG Telecom. At the start of 2008, SK Telecom held just over 50% of the mobile market, KTF about 30% and LG Telecom almost 20%. The South Korean Government is committed to transitioning the country to digital terrestrial, digital cable and digital satellite TV broadcasting by 2010. By 2010 incumbent Korea Telecom plans to have transformed its network into an NGN running over 50 times faster than current rates. By contrast, the development of the telecoms sector in the Democratic Peoples Republic of Korea (DPRK) is seriously impeded by the countrys parlous economic state and the governments general repression of communications. North Koreas obsession with secrecy has made it extremely difficult to get a clear picture of the sector. The announcement in February 2005 that the DPRK had nuclear weapons did nothing to help the flow of useful telecom technologies and expertise into the country. For further information, see Asia - Telecoms, Mobile and Broadband in North and South Korea Key highlights: In early 2008, South Koreas Fair Trade Commission gave approval to the proposal by SKT to buy a large stake in Hanaro, the countrys second-largest broadband service provider. The acquisition brought SKTs stake in Hanaro to 43.6% and allows it a quadruple play offering bundling mobile with fixed-line services. South Korea is the most penetrated broadband market in the world, with around 30% penetration (broadband subscribers as a percentage of population). Going into 2008, Internet usage rate of the population ages 6 and over had reached 76.5%.
53 By mid-2007, South Korea had the fourth largest broadband subscriber base in the world. The country had just over 14.4 million broadband subscribers at the time, putting it 3 million behind third placed Germany. Of the 14.8 million broadband subscribers at February 2008, 4.4 million were DSL subscribers. While DSL subscribers fell by 686,000 during 2007, other forms of broadband access including FttH increased by 1.553 million. This provided a good indication of the alternative developments taking place in South Korea going into 2008. 3G-based HSDPA services by SK Telecom and KTF show great success, with KTF planning to migrate all its subscribers to 3G by 2012 or earlier. By October 2007, KTF had signed up 2.11 million users to its 3.5G HSDPA network in just seven months. KTF launched HSUPA in five major cities, including the capital Seoul, with SKT well on its way to commence commercial operation in 2008. A law was passed by South Koreas National Assembly in early 2008 allowing the countrys telecommunications companies to offer real-time broadcasting over their broadband networks. This allowed KT and Hanaro to launch full IPTV services amid slowing growth in the traditional broadband and telephone markets. KT expected the number of its IPTV subscribers to rise to 1.5 million in 2008 from 330,000 at end-2007 when only VoD could be offered. In February 2008, Egypts Orascom Telecoms Holding won a licence to launch a Greenfield operation in North Korea, granting a de-facto monopoly in North Koreass almost non existent mobile market.
Asia-Pacific - Taiwan
Taiwan has been very progressive in its efforts to liberalise the telecommunications industry and to create a positive regulatory regime. Despite the odd bout of bureaucratic bickering, structural reforms have been achieved. At the same time, Taiwans telecommunication infrastructure has been upgraded significantly, undergoing a series of network modernisation projects over the last decade or so. Internet growth has been phenomenal in Taiwan. The proportion of the population who are Internet users has exceeded 65%. Some 80% of all homes in Taiwan own PCs and around 70% of homes have Internet connections. The market has moved rapidly away from dial-up access to broadband, mainly on DSL subscriptions, and over 60% of all Internet connections are broadband. The government has committed the country to being on a par with the US by 2010. Going into 2008 broadband penetration had been lifted to over 20%. There are a large number of ISPs, although a handful of big ones continue to dominate the market. Taiwans mobile market has been a remarkable phenomenon. By early 2002, the country had reached the milestone of one mobile service for every person on the island. After peaking at a penetration of 114% in late 2003, the penetration was sitting at around 105% going into 2008. Consistent with the performance of its impressive mobile sector, Taiwan moved energetically into the next generation of mobile services. Following the awarding of five licences for 3G services in 2002, one of the new licensees, APBW, launched its CDMA2000 1x service in 2003. The market newcomer passed the one million subscribers milestone in late 2006, having grown fivefold in just three years. Three other 3G licensees launched their 3G services in 2005 and now account for nearly 15% of the total mobile subscriber base. Taiwan has one of the highest TV penetrations in the world. In recent times, change has been the order of the day in Taiwans television industry - the establishment of a public television system, the legalisation of private cable TV operations, the increased popularity of satellite broadcasting, the promotion of digital television, and the employment of a whole range of new digital technologies.
54 See Asia - Telecoms, Mobile and Broadband in Taiwan for further information. Key highlights: In January 2008 the Taiwan Government raised the cap on foreign ownership in Chunghwa Telecom to 55% from the previous 49%. The direct foreign ownership cap remained at 49%; with the change referring to combined direct and indirect holdings. The direct ownership cap in Taiwan Mobile and Far EasTone is also 49% with indirect foreign holding capped at 60%. The government announced plans to invest US$664 million on the development of WiMAX technology over the next few years. WiMAX equipment manufacturers and operators were encouraged to co-operate to support the government aims to make Taiwan a role model for wireless broadband development in Asia. Incumbent mobile operators Chunghwa Telecom and Taiwan Mobile failed to secure spectrum at 2.5GHz. They were outbid by six companies, which walked away with the regional licences. The highest bidder, FITEL, agreed to pay 12.89% of its WiMAX service revenue to the government, and Far EasTone won with the lowest revenue-share bid of 4.18%. Mobile voice volume surpassed that of fixed voice communications for the first time in 2007. In early 2008, three Taiwanese operators announced their investment plans for network expansion: The Far Eastern Group planned to spend NT$10.4 billion (US$340 million) in 2008 to boost its 3.5G and WiMAX operations. The group won a WiMAX licence covering southern parts of the country in the first half of 2007. Chunghwa Telecom planned to invest NT$46 billion during 2008-2012 with the aim of achieving 80% broadband coverage by 2011. The company aimed to have 1 million Multimedia-On-Demand subscribers on its fibre network by end-2008, rising from less than 500,000 by end-2007. Taiwan Mobile Company planned to accelerate the deployment of its fibre optic network with a NT$8 billion investment, but had not specified a timescale. During 2007, a number of the five operators awarded trial licences for mobile TV started operations with the DVB-H standard. Taiwans mobile operators sold over 7 million handsets between them in 2007, with sales in 2008 expected to top 7.5 million units.
Asia-Pacific - South Pacific Islands:

Less than half of all Pacific Islanders have a phone and generally only had one supplier for any particular fixed, mobile or Internet service. Internet cafes and telecentres help to address the issue of low Internet penetration. To communicate outside the region, most islands are in a satellite footprint and both Fiji and Guam are connected by submarine cable. Penetration rates of telecom services in the region remain comparatively low, although mobile and Internet penetration have gained traction in some of the more highly populated and developed islands such as Fiji, PNG and Guam. Access to basic telecom services remains relatively expensive. Following the 2007 Pacific Islands Forum in Tonga, officials revealed that strong progress had been made to the digital connectivity plan. The strategy largely comprises two parts, a dedicated Pacific Islands satellite system sponsored by Australia, and the construction of a new cable connecting the 12 member nations and partially funded by the French government.
55 Pacific leaders are aiming for a 2008 implementation of a major new undersea cable network and satellite links servicing island nations throughout the region. Mobile telephony is expected to continue outpacing growth in fixed-line connections as the market moves into 2008. New technologies are gaining ground in some island countries. Several of the South Pacific nations are upgrading satellite links to outer islands, installing wireless broadband and upgrading fixed-line broadband capability and some are rolling out high-speed ADSL2+ broadband. There is strong interest amongst South Pacific operators regarding WiMAX as a communications solution. In November 2007 Fijis first licensed VoIP service provider, VoiceNetIP (Fiji) Ltd, planned to launch commercial operations after waiting three years for its VoIP licence. Market overview The islands comprised a total economic market of about US$20 billion. The Pacific Islands Trade Agreement (PICTA) governs the tiny proportion of trade that is conducted between the islands themselves in the region. In November 2007, after a lengthy process, the Fiji interim government passed a New Telecommunications Bill that fully deregulated Fijis telecom sector. The New Bill effectively ends the exclusive privileges granted to Telecom Fiji, Fintel and Vodafone Fiji. The Pacific Island Countries have three major options in terms of improving telecommunications access satellite communications, submarine cable, and mobile wireless computing. There are few submarine cables in the region, therefore, satellite communications plays a critical role in both the national and international infrastructure. Mobile telephony is expected to continue outpacing growth in fixed-line connections as the market moves into 2008. See South Pacific Islands - Telecoms, Mobile and Broadband
Asia-Pacific - Australia
Mobile communications is still a huge telecommunications powerhouse. The premium prices that the industry can charge are generating an ongoing flood of revenue into the industry. Furthermore, large parts of the 2G infrastructure have been written off and the spectrum on which these services are built has also long been written off. No wonder the industry have been so to move to the next stage, where, like what happened in the fixed network, revenues will come from mobility applications. But 3G is now making serious progress with more than 4 million users, led by Telstras Next G network. However, in general they obviously still want to milk their 2G revenues for as long as possible. Lets be honest it doesnt matter if a call is made on a 2G or a 3G network (or SMSs, for that matter), and these, combined, still account for well over 90% of mobile revenues. Data traffic both over the 2G and 3G networks is currently going thought the roof, fuelled by the capped price plans. Both in 2G and 3G the players remain the same: Telstra, Optus, Vodafone and Hutchison. Telstra is still leading the market, thanks to a very conservative strategy. They still have not introduced capped voice plans. Optus revenues have been severely affected by the competition of 2005/06. Vodafone and Hutchison have been leading the competition, but Vodafone remains a marginal operation and there is continued speculation about the future of the Australian operation. For a long time Hutchison has been the only 3G operator; however it is now facing increased competition and has lost its leading position to Telstra. Belatedly Optus is now rushing into 3G with an $800 million investment in a regional network.
56 The growth in prepaid has slowed down. The players are attempting to rein in the advance of too much competition, which around the world is manifested in large numbers of customers moving to prepaid services. The lack of a similar development in Australia indicates that the level of competition is maintained and controlled by the happy quadropoly. See Australia - Mobile Communications - Statistics, Trends and Forecasts for further information. Key highlights: Despite all the grandstanding on new data applications in 2008 the market will still be dominated by voice. Together with SMS that will account for well over 90% of all mobile revenues. There are now more mobile subscribers than there are people in Australia, indicating that a significant proportion of the population has more than one mobile subscription. Mobile revenues will grow to over $12 billion in 2008. ARPUs have dropped again and are now around $46 per month. Telstra has the lowest ARPU, and Hutchison has the highest. There are now more than 20 million mobile subscriptions. Following a spurt in 2006 capped prices have not featured to any large degree in the competition scene, indicating a controlled level of competition. A million CDMA customers will have to be transferred over the next 12 months, the majority to Telstras Next G. Growth in 3G is steady and is approaching 25% penetration. The growth in prepaid has slowed down, indicating a stabilisation of competition in the market. Mobile substitution remains low as mobile call charges remain relatively high. Fixed Mobile Convergence (FMC) is not expected to occur to any significant extent until 2010-2012. The handset market continues to be dominated by the operators and their bundled pricing strategies. Nokia remains the key supplier. Margins for retailers are again under pressure and continue their downward spiral.
57
Asia-Pacific - New Zealand:Error! Bookmark not defined.

The current mobile market is a duopoly of Vodafone New Zealand and Telecom Mobile. In the long term BuddeComm does not think it will be viable for more than two mobile network operators to survive in a nation as small as New Zealand, based on traditional voice and texting services. Competition can only be developed on top of these networks (MVNOs). The local mobile market is now approaching saturation and we expect overall market subscriber growth to drop to just 2.9% in 2007/08. New Zealand is finally catching up with the rest of the world in terms of broadband penetration, with overall subscriber growth in excess of 30% in 2006/07. Only a year only ago, we would have put New Zealand two to three years behind Australia in terms of some of its broadband developments. The bundling of voice, data and video services (triple play) and mobile services (quadruple play) are likely to develop on a more large-scale fashion in New Zealand in 2008 and 2009. Voice and data bundling has already been introduced by a number of players, including Telecom, Orcon (now part of Kordia) and ihug. These developments will be assisted by the governments decision to proceed with the operational separation of Telecom and to introduce new services such as LLU, naked DSL, and a wider range of regulated wholesale services which should begin to be introduced into the New Zealand market by the beginning of 2008. The FTA broadcasting networks are expected to see intense competition for viewers and advertising in 2008 and beyond, which will impact on their cost margins as they will be forced to put more money into programming and marketing. The new environment is going to open up lots of new opportunities for everybody involved. However, it could take time before that actually starts to happen. Opportunities include the value-added infrastructure services such as data centres, content hosting, network management, etc. But equally a range of innovative customer services can be built on the new wholesale products and perhaps more importantly open networks will create a great new environment for digital media, e-health, tele-education and smart grid applications in which there will now be much wider scope for a variety of organisations to participate. See New Zealand - Mobile & Broadband Overview and Analysis for further information. Key Highlights Vodafone took the number one spot in mobile subscribers in New Zealand back in 2003 and now holds 53% of the subscriber market, despite a 2% overall market share loss in 2006/07. With a reluctant Vodafone, MVNO networks are very slow to get of the ground. Overall subscriber growth was unusually high at 11.6% in 2006/07, bringing the market to a total of 4.25 million subscribers. However, we expect overall market subscriber growth to drop to just 2.9% in 2007/08 and 2.3% in 2008/09 as the market approaches saturation. In the long term BuddeComm does not think it will be viable for more than two mobile network operators to survive in a nation as small as New Zealand, based on traditional voice and texting services. This will require ongoing regulations. Mobile voice is becoming another commodity service, and there will be increasing pressure on Vodafone and Telecom to lower mobile call prices, which remain very high by international standards. However, there could be potential opportunity for a third operator to enter the market offering niche data services.
58
Middle East Gulf

The GCC countries have benefited to differing degrees, depending on their reserves, from the very high oil and gas prices. Even countries with less oil such as Bahrain or the emirate of Dubai have benefited from the wealth coming into the region. All countries realise the need to use the bonanza to upgrade their infrastructure. They are also keen to increase the knowledge component of their economies as a bulwark against a potentially less profitable future. All of these factors have had a strong bearing on their telecoms industries. In addition, all the GCC countries have liberalised their markets to a greater or lesser degree, resulting in much greater competition, particularly in the mobile sector. This trend towards greater competition is still continuing, extending into the fixed-line and Internet sectors. The markets of Iraq, Yemen and Iran are much less developed but are all quite exciting. In Iraq, the mobile market has been one of the great successes of the post-war period, growing from nothing to 44% penetration in four years. This is partly a result of very little fixed-line infrastructure. Three quite equal operators were competing in the market but after the award of longer-term licences there are now three much less equally sized players, which will possibly result in a less competitive and more expensive market. The lack of development in Iran is government induced rather than a result of economic factors. Since the launch of a second mobile operator in September 2006, this sector at least has been transformed with annual growth of over 100%. The broadband and Internet sectors are very different due to government restrictions on competition, speeds and services. The government is intending to introduce a level of private ownership into the incumbent operator and it will be interesting to see what effect this will have. Yemen, with GDP per capita of only around US$1,000 is nevertheless also experiencing healthy growth in its mobile market. See Middle East - Telecoms Mobile & Broadband in The Gulf Countries for further information. Key highlights: The GCC countries are investing in NGN infrastructure, with FttH becoming a reality, particularly in the smaller and more urban countries. Broadband penetration levels do not appear high but improve once larger household sizes are accounted for. Household broadband penetration in the UAE is at least 40%. Zain of Kuwait and Etisalat of the UAE have continued their expansion abroad. Zain now operates in 20 countries and Etisalat in 16, in the Middle East, Africa and Asia. Etisalat claimed to be the fastest growing mobile operator in the world in 2008, with a proportional mobile subscriber base of 24.2 million, an annual increase of 106.41%. Qtel of Qatar is also expanding rapidly abroad, also with interests in 16 countries (most of them acquired in 2007), although as yet with a smaller subscriber total than Etisalat or Zain. STC of Saudi Arabia has aspirations to join the club, with new interests in Kuwait, South Africa and Turkey. The remarkable regional DTH satellite TV market continues unabated, with around 300 FTA channels plus pay TV operators. Despite many channels being launched for political rather than commercial reasons, the competition is generating some very interesting players news channels Al Jazeera and Al Arabiya and more entertainment-oriented channels from Rotana and others. The launch of services by MTN Irancell has transformed the Iranian mobile market, causing annual growth of over 100%, hugely greater availability of services and introduced a degree of transparency to the market. All countries have licensed at least two mobile operators. A third licence has been granted for Kuwait, while in Bahrain an auction for a third licence in imminent.
59 Saudi Arabias third mobile operator, Zain, is about to launch operations into an already very competitive market. Saudi Arabia will see major players STC, Etisalat and Zain go head to head. Of the many new licences auctioned in the region in the past few years, the second Qatari mobile licence was the first to go to a European operator. Vodafone Qatar expects to launch services early in 2009. Since the introduction of competition to the UAE mobile market, penetration rates have leapt to nearly 170%. Growth rates in all countries tend to reflect the degree of competition in the market rather than the penetration levels.
Middle East Mediterranean and Levant Countries

Egypt, Israel, Jordan and Turkey have all benefited greatly from comparatively well developed regulatory systems and competitive markets resulting in strong investment in telecommunications. Syria remains steadfastly against liberalisation and competition and consequently has an undeveloped market. Lebanon is poised to choose which course it will take. In Israel regulatory policies have produced intense competition with several very strong players and a very advanced and highly developed market where telecommunications and media are converging in a digital environment. Household broadband penetration is around 70%, mobile penetration is well over 100% and 3G penetration around 30%. These figures, together with Israels flourishing IT and venture capital sectors, indicate fertile ground for digital media developments. Turkey has a unique position in the region with its links to the European Union. It has a healthy mobile market and growing broadband penetration. Egypt and Jordan are not rich countries but sensible policies have resulted in relatively open and developed markets. Egypt has emerged as the largest Arab Internet market thanks to the successful implementation of a free Internet strategy. Jordan has mobile penetration of over 80%, probably inflated by non-Jordanian nationals and multi-SIM usage, but still indicative of a highly developed market. Lebanon is a battle ground between groups that would stifle development in the manner of Syria and those that seek to liberalise the market and bring the benefits of mobile and broadband services to a larger proportion of the population. While fixed-line, Internet and broadband penetration rates are low in the Arab countries of the region, one must always take into consideration larger household sizes, young populations and a habit of sharing broadband and cable TV subscription amongst neighbours. See Middle East - Telecoms Mobile & Broadband in The Mediterranean & Levant countries for further information. Key highlights: Number portability and new licences have shaken up the Israeli fixed-line market, with incumbent Bezeqs share of the market falling to levels around 85% by mid-2008. The report of an advisory commission has recommended key regulatory changes, including creating a wholesale market in all sectors, unbundling local lines and licensing MVNOs. The advisory commission has also advocated giving independent content providers a real chance to operate on broadcasting infrastructure. Israel has widespread DBS and cable multi-channel TV and IPTV is also operational. Jordans thriving mobile market is likely to get even more competitive with the granting of its first MVNO operator licence in mid-2008.
60 A second Egyptian fixed-line licence is planned for 2008, together with the expansion of broadband services and wireless networks. The licensing and launch of a third network gave Egypts mobile market a significant boost to reach 43% penetration by March 2008, up from only 27% in early 2007. Following the resolution of its political stalemate in mid-2008, the Lebanese government will decide whether to privatise and liberalise its fixed line and mobile operators. A string of potential buyers is ready to enliven the market and release its untapped potential. An independent regulator has made an impressive start. Turkeys communications market holds much potential given the size of its population, its growing economy and the alignment of its regulatory framework with that of the European Union.

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The Global Mobile Market Fact Book 2008

Published by telecomsmarketresearch.com In association with Buddecomm

BuddeComm & Chiltern Magazine Services Ltd. 2008

BuddeComm & Chiltern Magazine Services Ltd. 2008

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The Global Mobile Market Fact Book 2008

GSM & CDMA:

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Bluetooth & UWB:

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Europe Central Europe

Europe Balkans and South East Europe

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Penetration 61.1% 33.8% 111.0% 110.2%

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