‘State of Internet’ report shows fixed broadband in emerging markets still lags

By Jim O'Neill on Dec 16 2015 at 7:30 AM
‘State of Internet’ report shows fixed broadband in emerging markets still lags

Global average connection speed increased slightly (0.2%) to 5.1 Mbps from the second quarter, accounting for a 14% increase year-over-year. South Korea had the top average connection speed at 20.5 Mbps, despite a year-over-year drop of 19% since the third quarter of 2014. Rounding out the Top 10 countries’ average connection speeds were: Sweden (17.4 Mbps), Norway (16.4 Mbps), Switzerland (16.2 Mbps), Hong Kong (15.8 Mbps), Netherlands (15.6 Mbps), Japan (15.0 Mbps), Finland (14.8 Mbps), Latvia (14.5 Mbps) and Czech Republic (14.5 Mbps).

Global average peak connection speed declined a slight 0.9% to 32.2 Mbps in the third quarter. This accounts for 30% year-over-year growth. Singapore (135.4 Mbps) and Macao (73.7 Mbps) saw double-digit quarterly gains at 25% and 18%, respectively. Singapore also retained its position as the country/region with the highest average peak connection speed.

Globally, just 5.2% of unique IP addresses connected to Akamai at average speeds of at least 25 Mbps, up 6.3% increase over the previous quarter. Year-over-year, global 25 Mbps adoption increased some 15%.

U.S., Canada see speed increases

In the third quarter, average connection speeds in the U.S. hit 12.6 Mbps, up nearly 10% from 2014. The Top 10 states showed improvements across the board, but no state had average connection speeds reaching the FCC’s new 25 Mbps broadband threshold.

Forty-four U.S. states – including sector-leading Washington, D.C. -- had average connection speeds above the 10 Mbps threshold. Rounding out the Top 10 were Delaware (19.5 Mbps), Utah (16.2 Mbps), Massachusetts (16.2 Mbps), Rhode Island (15.7 Mbps), Washington (15.2 Mbps), Maryland (15.0 Mbps), New Jersey (15.0 Mbps), Virginia (14.9 Mbps) and New York (14.8 Mbps).

In Q3, the Top 10 states showed fairly strong quarterly growth across the board, in contrast to the second quarter, when only 3 of the top 10 states had increases. Delaware had the strongest increase at 31%.

All 50 states and the District of Columbia saw average peak connection speeds grow in the third quarter, as the U.S. average peak speed reached 57.4 Mbps.

Fifteen major telecommunication companies have rolled out (or plan to rollout) gigabit-plus broadband service in 176 U.S. cities. But the report points out that more than 80 service providers now are offering gigabit connectivity in the U.S.

That market – after a very slow start -- is growing quickly.

Canada, meanwhile, had average connection speeds of 11.9 Mbps, up 16% Y/Y, and saw peak connection speeds of 52.4 Mbps, up 20% from a year ago.

Latin America has room for growth

Latin America showed improvements in broadband speeds but still shows that a lot of work needs to be done to expand infrastructure.

Uruguay (5.9 Mbps), had the highest connection speeds in LatAm, followed by Chile (5.7 Mbps), Mexico (5.5 Mbps), Peru (4.4 Mbps), Colombia (4.2 Mbps), Argentina (4.2 Mbps), Ecuador (4.1 Mbps), Brazil (3.6 Mbps), Panama (3.5 Mbps), Costa Rica (3.2 Mbps), Bolivia (1.8 Mbps), Paraguay (1.5 Mbps) and Venezuela (1.5 Mbps).

Fixed broadband adoption rates in the region also lagged North America, where Canada had the highest penetration (87%) and the U.S. followed at 80%.

Uruguay, again, was tops in Latin America with an adoption rate of at least 4 Mbps by 68% of households. Mexico saw Mexico 64%, Chile 62%, Colombia 48%, Peru 46%, Argentina 39%, Ecuador 36%, Panama 33%, Brazil 32%, Costa Rica 20%, Venezuela 2.1%, Bolivia 2.8% and Paraguay 2.1%.

EMEA

Of 25 surveyed countries in EMEA, 20 had average connection speeds at or above 10 Mbps; all of them, except South Africa, had average connection speeds above the 4 Mbps broadband threshold.

Sweden (17.4 Mbps) had the highest average connection rate in the region, followed by Norway (16.4 Mbps), Switzerland (16.2 Mbps), Netherlands (15.6 Mbps), Finland (14.8 Mbps), Czech Republic (14.5 Mbps), Denmark (14.0 Mbps), Romania (13.1 Mbps), United Kingdom (13.0 Mbps), Belgium (12.8 Mbps), Ireland (12.4 Mbps), Germany (11.5 Mbps), Austria (11.4 Mbps), Israel (11.2 Mbps), Slovakia (11.2 Mbps), Hungary (10.7 Mbps), Portugal (10.6 Mbps), Poland (10.6 Mbps), Spain (10.4 Mbps), Russia (10.2 Mbps), France (8.2 Mbps), United Arab Emirates (6.8 Mbps), Italy (6.5 Mbps), Turkey (6.2 Mbps) and South Africa (3.7 Mbps).

Fifteen of the surveyed EMEA countries had average peak connection speeds of at least 50 Mbps as compared with 11 in Q2.

Solid broadband infrastructure

Penetration of broadband over 4 Mbps is nearly ubiquitous in the Top 10 countries in the region with Netherlands (95%) leading, followed by Denmark (94%), Israel (94%), Romania (94%), Switzerland (93%), Sweden (92%), Belgium (91%), Finland (91%), Austria (90%) and Hungary (90%).

Fourteen of the following countries had 4 Mbps broadband penetration exceeding 71%, including: Poland at 88%, Norway at 88%, United Kingdom at 87%, Germany at 87%, Russia at 87%, Czech Republic at 86%, Portugal at 85%, United Arab Emirates at 85%, Slovakia at 85%, Spain at 85%, Turkey at 77%, Ireland at 76%, France at 74% and Italy at 71%.

South Africa 4Mbps broadband penetration was at 22% in Q3.

APAC has some of the highest – and lowest – connection speeds

As noted earlier, Korea topped the world for average connection speed at 20.5 Mbps. Rounding out the Top 15 were Hong Kong (15.8 Mbps), Japan (15.0 Mbps), Singapore (12.5 Mbps), Taiwan (10.1 Mbps), New Zealand (8.7 Mbps), Thailand (8.2 Mbps), Australia (7.8 Mbps), Sri Lanka (5.1 Mbps), Malaysia (4.9 Mbps), China (3.7 Mbps), Vietnam (3.4 Mbps), Indonesia (3.0 Mbps), Philippines (2.8 Mbps) and India 2.5 Mbps).

The Philippines, which had one of the slowest Internet speeds in the region, in September said it would provide free Wi-Fi coverage in schools, hospitals, airports, and parks in all of the towns and cities across the nation by the end of 2016. Although the free connectivity only runs at 256 kbps, the hope is that the availability of free access will push the incumbent service providers to both lower their rates and upgrade their networks to boost speeds to limit churn and cord cutting.

Stay tuned.

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