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3rd annual Said broadband study shows global quality improvement


October 18, 2010
By Anthony Capkun

October 18, 2010

The results of the third annual study of the quality of broadband connections around the globe reveals continued improvements worldwide, with more countries already prepared for the applications of tomorrow than in previous years, and two thirds of the countries analyzed meeting or surpassing today’s needs. Overall, thanks to a range of investments in infrastructure, global broadband quality has improved by 50% in just three years and penetration of broadband continues to improve, with about half of the households (49%) of the countries investigated now having access to broadband (up from 40% in 2008).

Key facts/highlights
Overall broadband quality has increased by 48% since 2008 (although some
countries have shown significantly larger improvements):

• The average global download speed has increased 49% in just three
years (3271 Kbps in 2008, 4882 Kbps in 2009 and 5920 Kbps in 2010).
• The average global upload speed has increased 69% in three years (794 Kbps in 2008, 1345 Kbps in 2009 and 1777 Kbps in 2010).
• Average latency has fallen by 25% to 142ms. This is slightly up from
140ms in 2009, but still significantly lower than 189ms in 2008.

48 countries, (66%), are meeting the requirements to enjoy all the major
services offered by the internet today (defined in the study as social
networking, low-definition video streaming, basic video-conferencing,
small file sharing), as well as not so demanding applications (such as
instant messaging, email, web browsing). This adds 10 countries since
2009, and 18 since 2008. This is in spite of global internet traffic
volumes rising by 166% from 2008-2010

Fourteen countries are already prepared for the “internet applications
of tomorrow” such as HD internet TV and high-quality video
communications services (consumer telepresence) which are expected to
become mainstream in just a few years time. These countries are: South
Korea, Japan, Latvia, Sweden, Bulgaria, Finland, Romania, Lithuania,
Netherlands, Hong Kong, Germany, Portugal, Denmark and Iceland. This is
up from nine countries in 2009 and just one in 2008 (Japan).
Nevertheless, Latvia, Bulgaria, Romania, and Lithuania have limited
penetration rates compared to the others.

South Korea tops the broadband leadership ranking for the second year in a row:
• Broadband quality in South Korea is ranked the highest and has set a new benchmark for the world.
• Average download throughput is 33.5 Mbps (an increase of 55% from
2009), average upload throughput is 17 Mbps (an increase of 430%) and
average latency is 47ms (an improvement of 35% versus 2009.
• 100% broadband penetration.

Broadband quality is directly linked to a nation’s advancement as a
knowledge economy. To reflect this in the results, and to see which
countries were outperforming their economic group and subsequently were
well prepared to make economic leaps, the researchers compared the
results according to the country’s stage of economic development as
defined by the World Economic Forum.

• South Korea topped the list of Innovation-driven economies (Stage 3)
with a score of 157. Slovakia came last within this group with a score
of 60.
• Bulgaria topped the list of Efficiency-driven economies (Stage 2) with
a score of 71. South Africa came at the bottom of this group with a
score of 34.
• Ghana topped the list of Factor-driven economies (Stage 1) with a score of 38. Angola came at the bottom with a score of 5.
• Qatar topped the list of Stage 1 to 2 Economies with its score of 106. Algeria came at the bottom with a score of 31.
• Bahrain topped the list of stage 2 to 3 Economies, with a score of
100, placing it amongst the broadband leaders of the world (rank 12 in
broadband leadership albeit with a low score on BQS at 23). Russia came
at the bottom of this group with a score of 50.

The team repeated and enlarged the number of regressions conducted in
the first edition between broadband quality, broadband penetration and
broadband leadership with over 40 socio-economic factors.

The research confirmed the early findings on the positive associations
between broadband and the economy. Significantly, broadband leadership
is strongly associated with competitiveness, knowledge economy and
innovation.

Closing the ‘digital divide’
• Hong Kong, Iceland, South Korea, Luxemburg and Malta lead in broadband penetration, with take-up reaching 100% of households.
• 49% of the households of all the countries studied have access to broadband, up from 40% in 2008 and 47% in 2009.
• Half of the countries show no digital divide in the quality of
broadband (i.e. between their main cities and outside them), a 38%
increase from 2009.
• There are already 38 cities with the broadband quality required to
become smart and connected communities; 18 of those are in Western
Europe, 11 in Eastern Europe, 7 in Asia, and 1 in the USA.
• Seoul tops the list of cities with the highest broadband quality (scoring 97 out of 100).
• Japan stands out as having the most cities with the highest broadband
quality in the world, with 3 cities Nagoya, Yokohama and Osaka rated
2nd, 3rd and 4th, respectively.
• Latvia has the largest gap between the quality in its main cities and
those regions outside, while Japan has the largest positive gap where
the quality outside its main cities is actually generally better than in
the main cities.

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Leapfrog opportunity
While some countries have been able to deliver good-quality internet
access for the majority of the population, others—in particular the
less-developed economies—have focused on delivering high-quality
broadband to their cities first, as key hubs of economic development,
via new investment in fiber or cable services. This is in contrast to
the typical approach of the more developed economies who have focused on
upgrading old copper based broadband (DSL) to bring broadband to as
much of the population as possible.

As a result, these countries—including many from Eastern Europe such as
Lithuania, Latvia, Bulgaria, Romania, Czech Republic and Hungary—have
been able to leapfrog the more advanced economies in terms of broadband
quality. However, while their Broadband Quality Score will be high,
their penetration figures will be lower, affecting their overall ranking
as broadband leaders.

• Bulgaria, Qatar and Bahrain were found to lead their economic groups
in broadband quality by considerable margins, competing comfortably, and
often beating, many of those in more advanced stages of economic
development.

Improvements in mobile broadband
• Sweden, Denmark, USA and Spain are the world leaders in mobile
broadband quality. Sweden and Denmark are also in the leading group in
fixed-line broadband.

• The latency of mobile broadband, one of the biggest weaknesses of
mobile internet access, has improved by 45% in just one year, from
1313ms to 724ms. Average download speed is now 936 Kbps, up 35% from
2009 and upload is now 277 Kbps, an increase of over 100% from 2009.

• Mobile broadband quality varies considerably with the technology used
much more so than with fixed-line. While on average the quality of
mobile broadband is far below that of fixed-line, about 30% of users
experience download throughputs above 1.3 Mbps (the threshold for
today´s applications in mobile).

• 10% of users are already enjoying average download speeds of 3.75 Mbps
and uploads of ca. 1 Mbps, and latency below 110ms. This gives them
comparable quality to fixed-line broadband users who are ready for
“today´s applications”, which correspond to the form factor of netbooks
and internet tablets.

• Even more outstanding was to find that 4% of users have average
download speeds of 7 Mbps, uploads of 1.7 Mbps and latencies below
100ms.

Household consumption
The study assessed the average consumption of different household
segments and found major differences between basic-digital homes and
smart and connected homes.

• Basic digital homes which mainly use the web for simple-quality
requirement applications such as web browsing, instant messaging and
social networking, consume about 20 GB per month.

• Smart and connected households, who would use the web for HD video
communication, HD entertainment, tele-education or telemedicine, home
security and others, can easily consume 500 GB per month and require an
assured bandwidth of 18 Mbps.

• Researchers looked at the impact that higher broadband quality has on
the competitiveness of the service providers in a country. Assessing the
top 25 countries in broadband quality the team confirmed that service
providers that offered significant higher quality of broadband increased
their market shares.

Specifically:
• Incumbents that provided fiber connections and were unchallenged increased market share up to 13% in just two years.

• Cable operators with superior quality increased shares between 10% (incumbents) and 60% (new players).

• Alternative service providers that provided higher broadband quality
have shown the highest market share gains, up to 96%, albeit from a
smaller customer base.

About the research
Using the data from 40 million real-life broadband quality tests
conducted in May-June 2010 on the internet speed testing site,
SPEEDTEST.NET , the researchers were able to evaluate the broadband
quality of 72 countries around the globe.

Quality was evaluated by scoring the combined download throughput,
upload throughput, and latency capabilities of a connection, the key
criteria for a connection’s ability to handle specific internet
applications, from consumer telepresence to online video and social
networking. These criteria are expressed as a single ‘Broadband Quality
Score’ for each country. By combining this Broadband Quality Score with
broadband penetration figures for each country (i.e. the proportion of
households who have access to broadband, obtained from Point Topic in
2010), the researchers were able to map out the world’s broadband
leaders—those with the best combination of broadband quality and
penetration.

Building on last year’s study, the 2010 data also includes analysis of
the broadband quality of 239 cities, providing further insight into the
evolution of smart connected communities around the world.

The measurement of mobile broadband quality, first introduced to the
study last year, has also been expanded significantly to include 68
countries (94% of the overall sample). The research has also explored
the patterns of broadband consumption per household and evaluated the
impact these will have on overall broadband quality requirements. The
study was conducted by a team of MBA students from the Saïd Business
School at the University of Oxford and the University of Oviedo’s
Department of Applied Economics, and sponsored by Cisco.


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