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Fixed broadband Internet access: analysis of the leading operators and forecasts for the industry in the world till 2025

October 2015

Analytical Report (full version)

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Analytical Report (full version)

Fixed broadband Internet access: analysis of the leading operators and forecasts for the industry in the world till 2025
Fixed broadband Internet access: analysis of the leading operators and forecasts for the industry in the world till 2025
October 2015

Fixed broadband Internet access: analysis of the leading operators and forecasts for the industry in the world till 2025

October 2015

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In this research J'son & Partners Consulting have compared the experience of the 15 leading operators of fixed broadband Internet access, their development strategy, the business models and product portfolio.

 

Based on the results of this comparative analysis and identified trends of the global fixed broadband industry development, the authors have predicted the industry development trends in general and by separated product lines and simulated the change of the global fixed broadband Internet market as well.

 

Based on these projections, there have been created recommendations for transformation of the infrastructure operators.

 

 

Key issues of the study

 

The study has considered the trends of the fixed broadband industry development, as well as their impact on the market development up to 2025. Based on the identified trends, the authors have forecasted the changes in the volume and structure of this market during the above-mentioned period, as well as some technological changes that will influence the development of the industry as a whole. J’son and Partners Consulting have carried out a comparative analysis of the 15 world's leading operators of fixed broadband Internet access and made recommendations for operators in terms of their technological platform development to provide better services.

 

 

Practical value of the study

 

The study has made projections for changes in the size and structure of the market of fixed broadband services. In addition, the research contains a comparative analysis of activities of the fixed broadband leading operators in terms of their business model, product portfolio and development strategy, as well as special recommendations for the broadband operators in relation to their technological infrastructure modernization.

 

 

Target auditory

 

The results of the study and its findings will be of interest to fixed-line operators, equipment and solutions manufacturers and for telecom operators, system integrators, venture and investment funds, startups and research agencies.

 

 

Summary of the study

 

The development of the global fixed broadband market

 

The study shows that, despite the growth of the global subscriber base by 5-7%, which will continue in the future, the revenue of operators is falling, and, according to J'son & Partners Consulting, in 2019, the total revenue in the world will start to fall. The reason for this is the world average decline in ARPU of fixed network subscribers, due to the price erosion, and rivalry with other services – mobile services and OTT services from third party companies. The best solution for operators in this situation can be only a radical overhaul of their business model towards the transformation from classical wired operator to infrastructure and cloud service provider. This transformation will allow operators to radically expand their product portfolio and successfully defend their subscriber base from erosion from OTT services, as well as provide a convergence with mobile broadband.

 

The research authors forecast a change in the broadband Internet market structure by the access technology: in connection with the growth of subscriber needs for better bandwidth of access networks, the share of the optical technology on the "last mile" will grow faster and by 2025 can reach 45% (see Fig. 1).

 

Source: Ovum, J’son & Partners Consulting

 

In the sphere of content services, the hybridization of TV and Internet has led to the fact that operators are no longer the key element in the subscriber access to content. This means that mobile operators have to compete for subscribers of such services, not only with themselves but also with substituting OTT services. According the forecasts of J'son & Partners Consulting, in this regard, the share of income of “classic” cable TV operators (both analog and digital) will continue to decline due to the increase in the share of OTT and IPTV, and by 2025 “classic” operators will claim only 56% of the total industry revenue (see Fig. 2).

 

Source: Digital TV Research, J’son & Partners Consulting

 

 

Analysis of the leading operators

The study presents a detailed comparative analysis of 15 leading operators of fixed broadband:

→   Orange

→   Telefonica

→   Verizon

→   KDDI

→   SoftBank

→   TeliaSonera

→   NTT

→   Vodafone

→   KPN

→   Telstra

→   BCE

→   China Telecom

→   AT&T

→   Comcast

→   Deutsche Telecom

 

You will find detailed information on each operator: its financial performance, technologies it uses, available subscriber devices, product portfolio, presence/absence of operator OTT services, development strategies and plans for the further development of its services.


 

Evolution of the infrastructure of operators considering the development trends of the industry

 

Taking into account general trends in the industry, we can say that the traditional business model of operators of fixed broadband based on a vertically integrated technological network model with hardware-dependent services and one-sided market model, where the only source of income is the network subscribers, can no longer ensure the competitiveness of operators. The further existence of such a business model may in the coming years turn them into a "pipe" for third party companies for access to OTT services.

 

In order to avoid that, operators need to radically change their business model, both in technological and commercial aspect. Only the transition to a bilateral business model, coupled with a transformation into a provider of digital services based on cloud service platforms, as well as the transition to the SDN/NFV technology platform (which can provide both the core network and subscriber equipment with virtualization functions), can ensure long-term sustainable development of fixed broadband operators.

 

 

 

Main conclusions of the study

Broadband operators approached the line beyond which they will need radical changes in their technological and business models.

Competition with OTT services, cost of services, quality of content and innovation are the main factors determining the dynamics of the subscriber base of fixed broadband operators.

Operators' revenues from provision of broadband access services will fall, and the only solution is to compensate these losses providing content services and other additional services.

The growth of content consumption will stimulate the modernization of their networks.

There is no universal technical strategy for fixed broadband operators, but by 2025 optics will be the major "last mile" technology.

 

 

 

More detailed results of the research are presented in the full version of the report:

«Fixed broadband Internet access: analysis of the leading operators and forecasts for the industry in the world till 2025»

 

Example of the contents:

 

Summary

 

1. Introduction

 

2. Main trends of evolution of fixed broadband operators

 

3. Development of the global market of fixed access 2013-2025

3.1.  Fixed broadband access

3.1.1. Development forecast, 2013-2025 (monetary terms)

3.1.2. Forecast of the market structure change

3.1.3. Promising technologies for providing services

3.2. Cable TV

3.2.1. Development forecast, 2013-2025 (monetary terms)

3.2.2. Forecast of the market structure change

3.2.3. Features of the OTT development in 2013-2025: structure and size of the market, the division between linear broadcasting and video on demand

3.2.4. Requirements to signal bandwidth in the context of the development of the quality of video and compression codecs

3.3. Fixed telephony

3.3.1. Development forecast, 2013-2025 (monetary terms)

3.3.2. Forecast of the market structure change

3.4. VAS-services

3.4.1. Development forecast, 2013-2025 (monetary terms)

3.4.2. Forecast of the market structure change

 

4. Analysis of the leading fixed access operators: business model, product portfolio, strategy development

4.1. Profiles of the leading operators

4.1.1. Orange

4.1.2. Telefonica

4.1.3. Verizon

4.1.4. KDDI

4.1.5. SoftBank

4.1.6. TeliaSonera

4.1.7. NTT

4.1.8. Vodafone

4.1.9. KPN

4.1.10. Telstra

4.1.11. BCE

4.1.12. China Telecom

4.1.13. AT&T

4.1.14. Comcast

4.1.15. Deutsche Telecom

4.2. Comparative analysis

4.2.1. Market specifics

4.2.2. Competitive situation

4.2.3. Business model

4.2.4. Product portfolio

4.2.5. Development strategy

 

5. Evolution of the infrastructure of operators considering the development trends of the industry

 

6. Conclusion

 

 

This information note is prepared by J’son & Partners Consulting, We strive to provide factual and prognostic data that fully reflect the situation and are available to us before issuing the material.

 

 

The media may use any graphics, data or forecasts contained in this market review only with reference to the source of information - J'son & Partners Consulting. ™ J'son & Partners [registered trademark]  

 

 

In this research J'son & Partners Consulting have compared the experience of the 15 leading operators of fixed broadband Internet access, their development strategy, the business models and product portfolio.