Access Price Benchmarking for APCC 2013
1
Access Price Benchmarking for APCC 2013
Page
1.
Executive Summary 3
2.
Introduction
2.1 Scope of Study
2.2 Data coverage
3.
Leased Lines Access
3.1 Coverage
5
8
10
10
10
3.2 Simple and Groomed Circuits
3.3 Simple Leased Lines
4. Ethernet Access
4.1 Coverage
4.2 Point-to-point (P2P) Ethernet
4.3 Point-to-multipoint (PMP) Ethernet
5. Digital Subscriber Line (DSL)
5.1 Symmetric/Asymmetric
5.2 DSL Installation charges
6. Leased Circuits vs. Ethernet Access
7. Conclusion
8. Appendix
12
13
39
39
39
43
46
46
49
51
53
57
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Access Price Benchmarking for APCC 2013
1.
This report follows similar APCC Access Benchmarking reports in 2003, 2006 and 2009. This report covers 14 economies, the same as in 2009 and two more than in the 2006 report.
The economies are:
Australia
China
Hong Kong
Indonesia
India
Japan
Malaysia
New Zealand
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
2.
All 14 economies reported data for leased lines and for Ethernet access and 11 economies for symmetrical DSL compared with six in 2009, and six for asymmetric DSL compared with eight in 2009. The data suggests a continuing spread of Ethernet access, especially for
100Mbps and 1Gbps and use of DSL.
3.
As in previous reports, the prices reported are not list prices but the prices actually paid by the seven respondent international carriers. However, it is not possible to judge from the data how representative overall they are of any particular economy. Clearly the actual prices will be influenced by, among other factor, discounts for bulk-buying and for strategic marketing purposes.
4.
The idea of real price comparisons was introduced into the 2009 report to take account of changes in dollar exchange rates and local rates of inflation. This report does likewise, but with the caveat that the international financial crisis and policy responses to it has played havoc with currency exchange rates and affected local rates of inflation in different ways.
Therefore 2009-equivalent “real” prices are a less reliable measure than in the previous report. At the end of the day international carriers have to pay in very real current US dollars. A table of deflators is provided in Table 2.1.
5.
The prices used for comparative purposes 2012-2012 are simple averages across all bitrates of leased circuits. This follows the practice of the previous two reports. Ideally a weighted average would be used reflecting the number of circuits in each category, but this data is mostly not available. Some inference may be drawn that the weighting towards lowerpriced (and therefore lower bitrate) circuits has lessened since 2009. See Table 3.3.6a.
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Access Price Benchmarking for APCC 2013
6.
Key issues are:
Leased lines remain the most widely used leased circuits. Overall prices have fallen, in some cases substantially such as South Korea by 41% and 22% in Indonesia; but
Indonesia, Malaysia and Vietnam are by far the most expensive. Notable trends are the fall in overall prices in India and the continuing fall of prices in China. On the contrary, if the data is taken at face value, reported prices in Australia and New Zealand have increased substantially even more so in “real” prices. However for Australia, removing one set of reported high price data (i.e. treating it as an outlier) reduces the price increase to 2% and in the case of New Zealand for each bitrate there is only one carrier reporting data.
For Ethernet access Vietnam seems to be an outlier, way beyond other economies in price. Also high is the Philippines which shows marked price increases for some bitrates over 2009. Malaysia is close behind but its prices are down by a large margin from 2009.
Installation costs seem to have come down in proportion to annual rentals as the average across all economies is 8.8% in 2012 compared with 8.9% in 2009. However, see
Appendix Table 8 for an alternative method of estimation.
Although there is data for leasing DSL circuits from 11 economies, most of it comes from
Australia and China, with Australia notably higher in rental charges and notably lower in installation charges than China. Installation charges exceed 10% of annual rental costs for symmetric DSL in five economies, in Malaysia they are reported as reaching 25%. For asymmetric DSL in Australia they are reported as close to 40%.
Certain economies tend to benchmark each other. For ease of reference Table 1 summarizes pairs of economies. Hong Kong continues to stand out as the most price competitive economy. See Conclusion Tables 7 and 7a-7c.
Table 1
Australia and New Zealand Australia lower for leased circuits but higher for Ethernet
Hong Kong and Singapore Hong Kong consistently lower
Indonesia and Philippines Indonesia higher for leased circuits but lower for Ethernet
Japan and South Korea Japan lower for some leased circuits, higher for some Ethernet
Malaysia and Indonesia Malaysia consistently higher
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Access Price Benchmarking for APCC 2013
In 2012, the Asia Pacific Carrier’s Coalition (APCC) commissioned TRPC Pte Ltd to produce a report benchmarking the price of access circuits across 14 economies in the Asia Pacific region.
The report is an update of a 2009 report which in turn was an update of reports commissioned in 2006 and 2003 by the APCC from Teligen.
The cost of international circuits has fallen dramatically over the past decade giving a boost to international telecommunications and to cross-border trade and the commerce that relies upon it. But local access prices have often not fallen as far nor as fast, and it is often the case today that they can constitute up to 40% or more of the end-to-end costs of international communications. As the 2009 report noted, while it is a reasonable assumption that where the local market is characterized by competition local access prices are likely to be lower, the determinants of local access prices are far from transparent. Regulatory and ownership issues can be an influence on prices, and there can be significant differences between list prices and actual prices after discounts are given for strategic market reasons, or because of bulk buying or long term contracts.
This report covers 2012 prices across 14 Asia Pacific economies as reported by APCC members, and provides tables comparing these prices with those reported in 2009, as well as between economies in 2012. It does not investigate the cause of particular price levels, nor changes in them, nor possible explanations behind economy comparisons.
The coverage of cities in each economy included (i) primary or major cities and (ii) secondary named cities or ‘others’. The tables in this report focus upon the major cities for comparison purposes. A list of secondary cities is included in Table 3.1 below.
Methodology
As with the 2009 report, this report for 2012 does not represent the individual prices offered in each market but composite prices based upon contributing APCC members. It also follows the
2009 report by using simple averaging (‘median’) of the reported prices, despite some respondents reporting ‘weighted average prices’ which should better reflect bulk-buy discounts.
1
In 2009 it was found that insufficient data was available to use ‘weighted average prices’ (where the weights are the number of lines leased at different speeds) and it appeared
1
The median is preferred over the mean as it more readily reflects the range of price levels.
5
Access Price Benchmarking for APCC 2013 that using simple average prices (the average of the lowest and highest prices reported for each category of leased circuit) made little overall practical difference to results. This report follows the 2009 methodology which also makes more transparent a direct comparison with the 2006 report.
The data generating process is always the most critical link in a chain of statistical analysis. If the data is not available, or not available in the form required, the statistical outcome is inevitably limited and possibly compromised. Ideally, statistical analysis requires careful quality control over where the data is collected, how it is collected and how it is represented for input into an analytical process. It is the nature of the beast that where commercially sensitive data is involved from a variety of competing sources that necessitate confidentiality, the data will not knowingly meet all these requirements. Working within these limitations, this 2012 report is a fair representation of the data as reported by respondents.
Price Deflators
Price deflators are only a very approximate method of comparing real prices between years.
This is even more the case for the period 2009-2012 which has been dominated by the international financial crisis, sometimes referred to as ‘The Great Recession’ starting in 2008.
Currency fluctuations and domestic rates of inflation have been influenced by extraordinary issues, but the bottom line is that international carriers still have to pay in real current dollars.
“Real” price deflators are therefore only used in this report as occasional reality checks. For example, the nominal prices of simple leased circuits are generally much higher in Indonesia than in other economies, and after using the price deflator it remains true that Indonesian prices are generally higher.
The deflator is composed of two elements: the change in the dollar exchange rate and the local rate of inflation (annual mean average x 3 years). Other things remaining equal, a rise in the dollar exchange rate (a fall in the dollar value of the local currency) will make 2012 prices appear lower than in 2009, and vice-versa. Other things remaining equal, a rise in the local rate of inflation (higher prices in 2009 dollar terms) will make 2012 prices appear higher than in
2009, and vice-versa. The two moving in the same direction together will counteract each other, whereas the two moving in opposite directions will reinforce each other. To arrive at real
(or constant dollar) 2009-equivalent prices for 2012, the percentage change in the dollar-local currency exchange rate should be deducted from the percentage change in the local inflation rate. For ease of reading, in Table 2.1 the currency rates are inverted to show local currencydollar exchange rates.
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Access Price Benchmarking for APCC 2013
Table 2.1 summarizes the deflators for each of the 14 economies in the 2012 report. Rates are measured from 16 January 2009 to 16 January 2013.
Table 2.1
Economy
Dollar Value Currency Deflators for each economy
Currency 2009-2012 Inflation 2009-2012 Deflator 2009-2012
Australia
China
Hong Kong
India
Indonesia
Japan
Malaysia
-56.9
8.2
0
12.4
13.2
2.4
15.7
8.0
12.5
13.5
27.7
14.1
-0.6
9.0
48.9
-20.7
-13.5
-40.1
-27.3
-1.8
-24.7
New Zealand
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
-55.9
13.7
17.7
23.1
13
14.2
-19.9
7.7
-8.7
15.4
9.9
3
10.6
48.2
48.2
-5.0
-33.1
-33.0
-16.0
-24.8
-28.3
Rates are measured from 16 January 2009 to 16 January 2013
Sources: http://www.imf.org/external/np/fin/data/param_rms_mth.aspx
and http://www.tradingeconomics.com/countrylist/inflation-rate
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Access Price Benchmarking for APCC 2013
This 2012 report covers the same 14 economies as in 2009. The objective of the study was to assess local access prices charged by domestic operators to international carriers in those 14 economies:
Economy
Table 2.2
Scope of Study
Number of
Reporting Telcos
Economy
Number of
Reporting Telcos
Australia
China
Hong Kong
Indonesia
India
Japan
7
7
7
6
5
7
New Zealand
Philippines
Singapore
South Korea
Taiwan
Thailand
4
6
7
7
7
6
Malaysia 7 Vietnam 6
Seven international carriers contributed to the input of price data. All seven carriers reported prices from eight economies (compared with five economies in 2009). The lowest number reporting for any economy was four (compared with three in 2009). This indicates a slight increase in the geographical activities of the seven international carriers over the period.
Leased line speeds reported by respondents correspond to those of previous reports.
64 kbps
256 kbps
512 kbps
2048 kbps
34 Mbps
45 Mbps
1536 kbps
1984 kbps
155 Mbps
Prices for leased circuits include the installation fee and the monthly recurring cost (MRC) or rental. Installation fees, or one-off access fees, in some cases are waived entirely, in other cases show considerable variation. Purely for purposes of comparison with the two previous reports, installation fees are presented divided by 12 for the first year of operation and added to the
MRC.
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Access Price Benchmarking for APCC 2013
Groomed leased circuits are those which multiplex lower speed leased circuits into a single larger leased circuit. Their use is reported in all 14 economies in 2012 (compared with eight in
2009).
Symmetric and asymmetric combinations were reported from 11 economies in 2012, excluding
New Zealand, Korea and Taiwan (compared with six economies in 2009 including New Zealand,
Korea and Taiwan).
Australia
China
Hong Kong
Indonesia
India
Japan
Malaysia
Philippines
Singapore
Thailand
Vietnam
The downlink and uplink speeds reported in 2012 were as follows:
64 kbps
128 kbps
256 kbps
384 kbps
512 kbps
640 kbps
768 kbps
1000 kbps
1024 kbps
1538 kbps
2000 kbps
2048 kbps
2200 kbps
2700 kbps
3072 kbps
3200 kbps
2500 kbps
4000 kbps
4500 kbps
6000 kbps
8000 kbps
1.2 Mbps
1.55 Mbps
4 Mbps
6 Mbps
8 Mbps
10 Mbps
12 Mbps
15 Mbps
45 Mbps
155 Mbps
622 Mbps
All economies were reported as using Ethernet access circuits in 2012, including Vietnam which was not reported in 2009. The use of Ethernet appears more widespread than in 2009 which in turn was significantly more widespread than in 2006. Reported speeds, as in 2009, were as follows:
2 Mbps
10 Mbps
50 Mbps
100 Mbps
1 Gbps
10 Gbps
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Access Price Benchmarking for APCC 2013
The data used in this report, provided on a confidential basis by seven international carriers, all members of APCC, is based as we understand it upon the prices they actually paid during 2012
(i.e., wholesale prices), rather than the price lists of the domestic carriers providing the access circuits.
Table 2.3: Data Available
Australia
China
Hong Kong
Indonesia
India
Japan
Malaysia
New Zealand
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
Y
Y
Y
Y
Y
Y
Y
Y
Y
Leased Circuits
2012
Y
2009
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
2012
Y
Y
Y
Y
Y
Y
Y
N
Y
Y
N
Y
Y
Y
DSL
2009
Y
Y
Y
N
N
Y
N
N
N
Y
Y
Y
Y
N
Y
Y
Y
Y
Y
Y
Y
Y
Y
2012
Y
Ethernet
2009
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
N
This report covers fourteen economies.
The following speeds were used as the basis of services:
64 kbps
256 kbps
512 kbps
1536 kbps
1984 kbps
2048 kbps
34 Mbps
45 Mbps
155 Mbps
The prices in this report refer to leased circuits covering major city areas on the grounds that these are the most representative of the requirements of international carriers. This approached was adopted in the 2009 report and the previous 2006 report. This report also dropped the distinction between 2km and 5km prices. In the 2009 report respondents were
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Access Price Benchmarking for APCC 2013 asked to make this distinction but it proved unnecessary. In some cases leased circuit lengths for distances up to 1km from the local exchange were priced lower than distances beyond 1km, and thereafter prices rose according to longer distances, for example below and beyond 6km,
12km, etc. In other cases, the shortest distance covered by the lowest prices extended across an entire Central Business District (CBD) or city or metropolitan area. In some economies there are major price differences between circuits leased to cover city areas and national long distances.
Table 3.1
Major and Secondary Cities
Australia
China
India
Indonesia
Japan
Malaysia
New Zealand
Philippines
South Korea
Taiwan
Thailand
Vietnam
Major Cities
Sydney, Melbourne
Beijing, Shanghai
Bangalore, Chennai, Mumbai
Jakarta
Tokyo, Osaka
Kuala Lumpur
Auckland
Manila, Makati
Seoul
Taipei
Bangkok
Hanoi, HCMC
Secondary Cities
Canberra, Adelaide, Brisbane, Perth
Guangzhou
Bandung, Bekasi, Bogor, Denpasar,
Depok, Jogjakarta, Malang, Semarang,
Solo, Surabaya, Tangerang
Hamilton, Wellington
Cavite, Bulacan, Laguna, Batangas,
Visayas, Mindanano-Cebu, Davao
Dongchun
Taichung, Hsinchu
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Access Price Benchmarking for APCC 2013
Most leased line circuits are simple point-to-point direct connections between a customer’s premises and an international carrier’s Point-of-Presence (POP). Diagram A illustrates this situation where the leased line can be of any commercially-available bitrate.
Diagram 3.2a: Simple Leased Line
Section A
Competitive
Carrier’s POP
End user
In some cases operators offer a service whereby two or more lower-speed leased line circuits that pass through the same local exchange of a domestic carrier can be multiplexed into a higher-speed circuit connecting directly to an international carrier’s POP. This saves on the cost of renting multiple end-to-end simple leased line circuits, but a grooming charge may be levied by the domestic carrier. Diagram B illustrates this situation, where the combined bitrates of the leased lines is typically no more than 80% of the bitrate of the larger multiplexed circuit.
Diagram 3.2b: Groomed Leased Lines
Section A
Section B Section A
Competitive
Carrier’s POP Local exchange
Section A connection
Grooming services in 2012 were reported for all 14 economies compared with eight in 2009
(Australia, China, Hong Kong, India, New Zealand, Singapore, Taiwan and Thailand) and five in
2006 (Australia, Hong Kong, New Zealand, Singapore and Taiwan).
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Access Price Benchmarking for APCC 2013
This section summarises the data on simple and groomed leased lines, showing the average
Monthly Recurring Charges (MRC) or monthly rental, and the average one-off installation charges for each of the economies in 2012 and compares these prices with 2009.
The following tables show the 2012 results and then comparisons with 2009.
Table 3.3.1a
2km MRC simple line price (USD), major cities, 2012
64kbps
256kbps
512kbps
1536kbps
1984kbps
2048kbps
34Mbps
45Mbps
155Mbps
Australia
287
392
498
828
835
475
3897
3760
8461
New
Zealand
China Hong
Kong
India
210
272
333
442
384
310
2640
5805
116
147
187
187
187
192
1296
2387
Philippines Singapore South
Korea
345
146
284
731
1126
2889
Indonesia Japan Malaysia
865
1175
1390
2121
1816
2027
5403
14568
385
938
2111
2529
3224
241
476
548
1259
1417
1398
6968
6631
14209
Taiwan Thailand Vietnam
64kbps
256kbps
512kbps
1536kbps
1984kbps
2048kbps
34Mbps
45Mbps
155Mbps
619
804
868
1250
1250
535
289
491
670
648
500
1158
4989
8945
270
397
529
677
729
628
2409
2944
5164
124
232
342
503
616
671
2630
4573
75
87
97
277
394
269
1155
2212
99
235
367
612
931
925
3714
4538
6491
423
685
1298
1584
1464
13965
15988
38327
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Access Price Benchmarking for APCC 2013
Table 3.3.1b
2km MRC simple leased line prices (USD) including installation, major cities 2012
Australia China Hong
Kong
India Indonesia Japan
64kbps
256kbps
512kbps
1536kbps
1984kbps
2048kbps
34Mbps
415
521
632
956
992
603
5089
45Mbps 4846
155Mbps 10,144
New
Zealand
436
498
560
637
638
575
116
147
187
187
187
192
495
193
337
785
3085
6556
1296
2387
1211
3020
Philippines Singapore South
Korea
Malaysia
949
1258
1473
2204
1899
2114
424
987
2139
261
586
631
1368
1526
1508
7514
5655
14955
2651
3387
7147
14620
Taiwan Thailand Vietnam
64kbps
256kbps
512kbps
1536kbps
668
943
1007
1389
326
528
714
707
336
472
685
834
142
249
358
516
104
116
126
334
1984kbps
2048kbps
34Mbps
45Mbps
1389
668
529
1206
5357
885
733
2590
3331
635
690
2757
454
327
1270
155Mbps 9301 5578 4573 2286
Note: Prices are simple averages of monthly rental plus 1/12 th
of the installation charge
130
270
400
656
969
974
3810
4629
6615
452
735
1348
1613
1508
14032
16054
38394
Table 3.3.1c
Comparison of 2km MRC simple leased line prices (USD) with 2009
Australia China Hong
Kong
India Indonesia Japan Malaysia
2009 2012 2009 2012 2009 2012 2009 2012 2009 2012 2009 2012 2009 2012
64kbps
2048kbps
229 287 259 210 113 116 23 639 865 400 385 517 241
256kbps 405 392 380 272 182 147 171 345 1251 1175 2482
512kbps 443 498 565 333 210 187 209
1536kbps 545 828 377 442 195 187
1984kbps 666 835 611 384 193 187 88
2020 1390 2003
2523 2121 1242 938 1863 1259
146 3941 1816 1883
1044
1187
476
548
2180 1417
475 475 549 310 212 192 247 284 3544 2027 1596 2111 1921 1398
34Mbps 2739 3897 2188 691 731 8344 6968
45Mbps 2856 3760 2967 2640 1468 1296 1752 1126 10421 5403 3392 2529 10583 6631
155Mbps 5687 8461 6046 5805 3018 2387 4814 2889 13500 14568 5750 3224 17924 14209
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Access Price Benchmarking for APCC 2013
1984kbps
2048kbps
New
Zealand
Philippines Singapore South
Korea
Taiwan Thailand Vietnam
2009 2012 2009 2012 2009 2012 2009 2012 2009 2012 2009 2012 2009 2012
64kbps
256kbps
132 619
535 804
289
464
289
491
236 270 202 124 101 75
493 397 288 232 141 87
334
264
99
235
214
406 423
512kbps 712 868 667 670 717 529 481 342 143 87 384 367 593 685
1536kbps 1004 1250 1044 648 1296 677 830 503 377 240 819 612 1127 1298
926 1250 1317 500 1586 729 1200 616 412 251 843 931 566 1584
836 535 1067 1158 520 628 1012 671 383 269 1472 925 1715 1464
34Mbps 5679 2891 2409 4775 3714 14419 13965
4747 4989 2859 2944 3665 2630 1949 1179 5883 4538 18201 15988 45Mbps
155Mbps 8037 8945 6266 5164 8645 4573 3335 2212 10551 6491 38327
Table 3.3.1d
Comparison of 2km MRC simple leased line prices (USD) plus installation charges with 2009
Australia China Hong
Kong
India Indonesia Japan Malaysia
2009 2012 2009 2012 2009 2012 2009 2012 2009 2012 2009 2012 2009 2012
64kbps
256kbps
368
524
415
521
474 436 114 116 23 712 949 459 424
583 498 185 147 207 495 1332 1258 2560
559 261
1147 586
512kbps 548 632 779 560 216 187 319 2164 1473 2072 1290 631
1536kbps 657 956 604 637 200 187 2615 2204 1305 987 1962 1368
1984kbps 774 992 822 638 193 187 88 193 4011 1899 1965 2284 1526
625 603 850 575 215 192 339 337 3747 2114 1659 2139 2027 1508 2048kbps
34Mbps 3506 5089 2677 691 785 8774 7514
45Mbps 3684 4846 3490 3085 1504 1296 2326 1211 11078 5655 3471 2651 11059 7147
155Mbps 7113 10,144 6716 6556 3018 2387 5466 3020 13792 14955 5833 3387 20202 14620
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Access Price Benchmarking for APCC 2013
New
Zealand
Philippines Singapore South
Korea
Taiwan Thailand
2009 2012 2009 2012 2009 2012 2009 2012 2009 2012 2009
Vietnam
2012 2009 2012
64kbps 208 668 321 326 265 336 212 142 127 103 353 130 267
256kbps 599 943 497 528 561 472 303 249 181 116 285 270 463 452
512kbps 785 1007 701 714 787 685 496 358 183 116 416 400 650 735
1536kbps 105 1389 1082 707 1370 834 845 516 425 298 853 656 1184 1348
1984kbps 1002 1389 1335 529 1655 885 1216 635 463 309 863 969 624 1613
2048kbps 933 668 1105 1206 606 733 1027 690 434 327 1506 974 1737 1508
34Mbps 5846 3202 2590 4837 3810 14665 14032
4990 5357 3265 3331 3806 2757 2045 1295 5945 4629 18234 16054 45Mbps
155Mbps 8343 9301 6927 5578 8782 4573 3479 2286 10634 6615 38394
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Access Price Benchmarking for APCC 2013
Figure 3.3.1
Note: Simple (mean) average of changes across all speeds of leased lines
Tables 3.3.1 to 3.3.4 and Figure 3.3.1 indicate that
With the exceptions of Australia and New Zealand, there have been falls in average nominal prices across the board, although some increases in different bitrates. For example, in India nominal prices fell for 45Mbps and 155Mbps but rose in four lesser bitrates. In the Philippines, nominal prices fell in two bitrates and rose in four others, leaving the average overall change approximately zero. In Vietnam, although the average fell by 4%, nominal prices rose in the four lower bitrates.
Despite an average decrease of 22% in nominal price terms, Indonesia ranks the highest priced market on six bitrates up to 2048kbps and 3 rd and 2 nd highest for 45Mbps and
155Mbps. Malaysia on the other hand has come slightly down the list from the previous reports, being the 2 nd
highest only once (45Mbps) and 3 rd
highest four times. Vietnam takes the 1 st
slot for 34Mbps, 45Mbps and 155Mbps and 2 nd
slot three times. Adjusting for 2009 equivalent dollar-local currency prices brings Indonesian prices down by 27% but still leaves Indonesia way out in front. Only Vietnam and Malaysia are higher in both nominal and 2009-equivalent prices at 45Mbps and Vietnam at 155Mbps. In the case of
Vietnam real (2009 equivalent) prices come down by 28% but still not anywhere enough to change the situation.
Australia and New Zealand are the outlying cases in this set of data showing remarkable nominal price increases, averages across all bitrates of 38% and 28% respectively.
Converting to real prices simply exaggerates the rises by nearly 50% due to the
17
Access Price Benchmarking for APCC 2013 depreciation of their currencies against the US dollar since 2009. Given that the mean average annual rate of inflation was only around 2.5% in each economy over this period it is not immediately obvious exactly why the cost of leased circuits has risen by so much in three years. However it needs to be pointed out that in the case of Australia, if the data from the highest reporting carrier is removed from the higher speeds (34Mbps, 45Mbps and 155Mbps – there were three, four and three carriers respectively reporting these bitrates) the average nominal price increase drops to just 2%. In the case of New Zealand, only one carrier reported across 5 bitrates and one carrier reported at a single higher speed, so the data is very thin.
An interesting reversal of trend is the average nominal price fall in India despite price increases for the lower band leased circuits. A conversion to real (2009 equivalent) prices reduces prices by a further 40%. The 2009 report recorded prices in India appearing to rise substantially over 2006 prices, but the trend in 2012 is reversed.
China continued a steady downward trend: 14% in 2009 and 12% in 2012.
Comparing economies, Hong Kong is consistently lower than Singapore, Australia is lower than New Zealand, Malaysia is higher than Thailand, Japan is higher than S. Korea below
45Mbps and higher for 45Mbps and 155Mbps and Indonesia is consistently higher than the Philippines.
The havoc wreaked by the international financial crisis after 2010 which badly affected trade and investment flows has distorted many of the economic indicators, so not too much weight should be assigned in 2012 to 2009-equivalent “real” prices of leased circuits. And the fact is that international carriers still have to pay very real dollars at current prices.
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Access Price Benchmarking for APCC 2013
Figure 3.3.2a
)
China
India
Japan
New Zealand
Singapore
Taiwan
Vietnam
0 100 200 300 400 500
USD
600 700 800 900 1000
Figure 3.3.2b
19
Access Price Benchmarking for APCC 2013
Figure 3.3.2c
Figure 3.3.2d
20
Access Price Benchmarking for APCC 2013
Figure 3.3.2e
Figure 3.3.2f
21
Access Price Benchmarking for APCC 2013
Figure 3.3.2g
Figure 3.3.2h
22
Access Price Benchmarking for APCC 2013
Figure 3.3.2i
Reported installation charges as a proportion of the first annual leased line rental vary from
25% in the case of Australia and China to zero in the case of Hong Kong. A simple mean average of this proportion across 14 economies is 8.8% compared with 8.9% in 2009.
The methodology used is the same as 2009 for comparison purposes, namely a simple mean average of installation charges across the 14 economies for all bitrates. However, a more weighted approach would be to average the averages per bitrate. Doing this produces rather more startling figures which are presented separately in the Appendix for possible comparison in future reports.
From Figures 3.3.3a – 3.3.3j (below) installation charges appear a higher percentage at the lower bandwidths.
23
Access Price Benchmarking for APCC 2013
Figure 3.3.3a
Installation Charge relative to annual rental
Figure 3.3.3b
24
Access Price Benchmarking for APCC 2013
Figure 3.3.3c
Figure 3.3.3d
25
Access Price Benchmarking for APCC 2013
Figure 3.3.3e
Figure 3.3.3f
26
Access Price Benchmarking for APCC 2013
Figure 3.3.3g
Figure 3.3.3h
27
Access Price Benchmarking for APCC 2013
Figure 3.3.3i
Figure 3.3.3j
28
Access Price Benchmarking for APCC 2013
64kbps
256kbps
512kbps
1536kbps
1984kbps
2048kbps
34Mbps
45Mbps
155Mbps
In 2012 data was reported from all 14 economies, compared with eight economies in 2009.
Table 3.3.4a
2km MRC groomed leased line prices (USD), major cities 2012
64kbps
256kbps
512kbps
1536kbps
1984kbps
2048kbps
34Mbps
45Mbps
155Mbps
Australia
236
840
966
1027
889
889
4258
4258
3660
New
Zealand
China Hong
Kong
India
262
262
262
262
262
345
79
136
272
309
309
309
146
146
2255
2793
5661
2531
1750
2550
1045
1045
2805
Philippines Singapore South
Korea
Indonesia Japan Malaysia
731
1588
2057
2500
2555
2555
348
2569
2705
1642
501
1162
1629
2013
2370
2370
7913 4960
8077
9416
9416
13228
Taiwan Thailand Vietnam
64kbps
256kbps
512kbps
1536kbps
1984kbps
2048kbps
34Mbps
45Mbps
155Mbps
290
461
548
792
895
809
2777
2777
1270
201
691
933
757
757
3506
3506
4562
239
386
420
722
808
539
2411
2411
5307
Table 3.3.4b
235
503
520
970
962
962
3599
3599
8946
90
181
257
440
384
384
2889
2173
4104
214
793
789
390
830
830
8418
8418
5654
2km MRC groomed leased line prices (USD) including installation, major cities 2012
Australia China Hong
Kong
India Indonesia Japan Malaysia
110
342
146
243
459
459
2209
2209
2209
236
840
966
1027
889
889
4258
4258
3660
262
262
262
262
262
649
2255
3232
6275
79
136
272
309
309
309
2531
1750
2550
193
193
1123
1123
2961
731
1588
2057
2500
2555
2555
7913
348
2569
2705
1642
4960
8077
501
1162
1629
2013
2370
2370
9416
9416
13228
29
Access Price Benchmarking for APCC 2013
New
Zealand
Philippine s
Singapore South
Korea
Taiwan Thailand
64kbps
256kbps
512kbps
1536kbps
1984kbps
2048kbps
319
490
631
875
978
809
201
691
933
757
757
258
466
460
763
848
612
235
503
520
970
962
962
90
181
257
440
442
442
34Mbps
45Mbps
2777
2777
3506
3506
2411
2411
3599
3599
2889
2289
8418
8418
155Mbps 1270 4562 5307 8946 4279 5654
*Prices in red had no installation costs reported, hence are the same as the MRC for leased line prices
214
793
789
390
830
830
Vietnam
110
342
146
243
459
459
2209
2209
2209
Table 3.3.4.1a
Comparison of 2km MRC groomed leased lines prices (USD) with 2009
Australia China Hong Kong
64kbps
256kbps
512kbps
2009
175
250
315
1536kbps 479
1984kbps 550
2048kbps
34Mbps
45Mbps
155Mbps
4258
3660
New Zealand
2012
236
840
966
1027
889
889
4258
64kbps
256kbps
512kbps
2009
305
536
625
1536kbps 1076
1984kbps 1123
2048kbps
34Mbps
45Mbps
155Mbps
2012
290
461
548
792
895
809
2777
2777
1270
2009
178
317
452
837
911
445
2309
2432
5058
2009
264
420
621
695
668
367
2033
2922
5166
3062
5413
Singapore
2012
262
262
262
262
262
349
2255
2012
239
386
420
722
808
539
2411
2411
5307
India
2009
122
155
155
298
298
298
1324
2323
2009
95
157
194
198
193
225
1757
2921
Taiwan
1750
2550
2012
79
136
272
309
309
309
2531
2009
30
30
30
30
30
1187
2012
146
146
1045
1187
3184
1045
2805
Thailand
2012
90
181
257
440
384
384
2889
2009
112
256
400
737
843
874
5252
2012
214
793
789
390
830
830
8418
1675 7623 8418
3182 14034 5654
30
Access Price Benchmarking for APCC 2013
Table 3.3.4.1b
Comparison of 2km MRC groomed leased line prices (USD) including installation charges with
2006
Australia China Hong Kong India
64kbps
2009
271
256kbps
512kbps
346
411
1536kbps 575
1984kbps 646
2048kbps
34Mbps
45Mbps
155Mbps
2012
236
840
966
1027
889
889
4258
4258
3660
2009
494
663
872
940
913
677
2523
3365
5740
2012
262
262
262
262
262
653
2255
3389
6027
2009
95
157
194
198
193
225
1757
2921
2012
79
136
272
309
309
309
2531
1750
2550
2009
30
30
30
30
30
1187
1187
3184
2012
193
193
1123
1123
2961
New Zealand Singapore Taiwan Thailand
64kbps
256kbps
512kbps
2009
330
588
696
1536kbps 2028
1984kbps 1144
2048kbps
34Mbps
45Mbps
155Mbps
2012
319
490
631
875
978
809
2777
2777
1270
2009
197
354
489
874
948
498
2595
2815
5529
2012
258
466
460
763
848
612
2411
2411
5307
2009
151
184
184
351
351
351
1430
2481
2012
90
181
257
440
2009
122
266
420
757
2012
214
793
789
390
442
442
2889
2289
863
894
5289
7660
830
830
8418
8418
4279 14108 5654
*Prices in red had no installation costs reported, hence are the same as the MRC for leased line prices
31
Access Price Benchmarking for APCC 2013
Figure 3.3.4
Tables 3.3.4.1a to 3.3.4.1b and Figure 3.3.4 indicate
The price of groomed circuits in Australia showed substantial increases for all bandwidths, but the data is from only one carrier. Data from two carriers for New
Zealand shows prices fell for all categories. Why the difference between the two when they mirror each other in their price increases for simple leased circuits is not clear.
For all other economies the results are mixed: Taiwan shows an overall increase of
54% in the mean average of all groomed circuits, and while the increases are lower using real 2009-equivalent pricing, they remain increases. All other economies show either no change (Hong Kong and India) or an overall decline with variations according to bandwidths: China seven up and three down, Hong Kong four up and four down,
India three up and two down, Singapore four up and five down, and Thailand four up and five down. As with simple leased circuits, China exhibits a notable downward trend.
In 2009 only New Zealand showed a substantial average premium of groomed over simple leased lines, especially for 64kbps and 1536kbps, and no other economy reached 50%. Figure
3.3.5a shows that in 2012 seven of the 14 economies show premiums of over 50%, with
Thailand apparently charging a premium of nearly 200% for 256kbps, Malaysia over 150% for
32
Access Price Benchmarking for APCC 2013
512kbps and Japan nearly 150% for 155Mbps. There were positive mean average premiums in eight of the economies with Japan showing the highest. By contrast, there were significant negatives in China, the Philippines, Singapore and Vietnam.
Figure 3.3.5a
Figure 3.3.5b
33
Access Price Benchmarking for APCC 2013
The following graphs show ranges (minimum and maximum) of prices below and above the average price for leased lines at different bitrates offered in each economy as reported in 2012.
Average prices are indicated by the 100% line. Prices below that line show the percentage of the lowest price to the average price, and prices above that line show the percentage of the highest price to the average price.
The range of prices above the simple average is greater than the range of prices below in all cases except 35Mps and 45Mbps and in both these cases it is Vietnam that has reduced prices more than the others have raised them. Overall, as in 2009, this seems to imply a weighting in favour of prices lower than the average, maybe a reflection of discounts and/or of bulk buying by some international carriers. However, the ranges are decisively lower than reported in 2009 which suggests the weighting in favour of lower prices is weaker than in 2009.
Table 3.3.6
Bitrates
Upper Price Range percentage differences over average prices, 2012 and 2009
2012 2009 Bitrates 2012 2009
64 kbps
256 kbps
>200%
>250%
>400%
>800%
2048 kbps
45 Mbps
>350%
>180%
>1100%
>300%
Figure 3.3.6a
34
Access Price Benchmarking for APCC 2013
Figure 3.3.6b
Figure 3.3.6c
35
Access Price Benchmarking for APCC 2013
Figure 3.3.6d
Figure 3.36e
36
Access Price Benchmarking for APCC 2013
Figure 3.3.6f
Figure 3.3.6g
37
Access Price Benchmarking for APCC 2013
Figure 3.3.6h
Figure 3.3.6i
38
Access Price Benchmarking for APCC 2013
2Mbps
Australia
China
Hong Kong
India
Indonesia
Japan
Malaysia
New Zealand
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
In 2012 data was available from all 14 economies, including Vietnam for which there was no data in 2009.
The bitrates reported in 2012 were the same as in the 2009 report. Below
1Gbps the only economy that did not report usage of all bitrates was Indonesia for 54Mbps.
Only 5 economies were reported as using 10Gbps.
2 Mbps
10 Mbps
50 Mbps
100 Mbps
1 Gbps
10 Gbps
Data was reported from all 14 economies
P2P Ethernet connections are dedicated circuits (uncontended) but may vary according to the technical facilities supplied by domestic operators. As in 2009 and 2006, only price information was reported in 2012.
Point-to-multipoint (PMP) information was separately identified and is shown in section 4.3 below.
Figure 4.2a
2Mbps Ethernet P2P monthly rentals and installation charges, 2009 and 2012
Installation
1412.0
3060.0
52.0
593.0
3200.0
356.0
350.0
1852.0
159.0
399.0
229.0
2009
2Km >2Km
602.0
676.0
322.0
756.0
631.0
1138.0 1000.0
1434.0
1364.0
284.0
500.0
692.0
1647.0
230.0
828.0
Installation
2397.8
2540.3
0
9750.9
1111.0
847.5
1026.6
0
4333.3
1283.1
300.0
0
313.1
300.0
2012
2Km
698.7
304.8
288.8
74.8
850.0
697.0
965.3
482.0
1429.3
511.6
574.0
201.9
590.3
2746.0
>2Km
474.7
762.0
0
3517.0
0
0
0
568.0
327.0
0
937.0
115.9
0
0
39
Access Price Benchmarking for APCC 2013
Figure 4.2b
10Mbps Ethernet P2P monthly rentals and installation charges, 2009 and 2012
10Mbps
Australia
China
Hong Kong
India
Indonesia
Japan
Malaysia
New Zealand
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
Installation
928
3050
2971
879
438
297
3954
3048
89
774
1910
2009
2Km >2Km
999
1170
661
1800
4204
1614
1978
2082
2035 1646
798
1902
1207
2222
Installation
633
4333
1878
1000
690
626
300
2486
3339
0
9881
1111
1314
2790
2012
2Km
490
2020
1334
988
693
1148
9915
967
1044
553
341
1924
859
3318
50Mbps
Australia
China
Hong Kong
India
Indonesia
Japan
Malaysia
New Zealand
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
Figure 4.2c
50Mbps Ethernet P2P monthly rentals and installation charges, 2009 and 2012
Installation
4501.0
5548.0
0.0
663.0
3520.0
500.0
2702.0
1473.0
977.0
448.0
2009
2Km >2Km
1574.0 2285.0
3071.0
1385.0
2758.0
8457.0
4444.0
500.0
3705.0
4829.0 1843.0
1458.0
Installation
2889.6
6756.7
0
8593.8
0
978.5
2593.2
0
4333.3
2153.9
2000.0
1380.0
1070.8
800.0
2012
2Km >2Km
2216.9
2914.5
1870.0
8384.0
875.7 0
1324.3 21936.5
0
1474.5
4205.8
520.0
0
0
0
1350.0
4933.3
2039.4
2429.3
1686.0
3004.0
24281.0
218.0
0
4828.0
1206.9
0
0
>2Km
758
327
0
2163
449
0
0
948
2476
0
8571
0
0
0
40
Access Price Benchmarking for APCC 2013
Figure 4.2d
100Mbps Ethernet P2P monthly rentals and installation charges, 2009 and 2012
100Mbps
Australia
China
Hong Kong
India
Indonesia
Japan
Malaysia
New Zealand
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
Installation
4406.0
5756.0
204.0
726.0
762.0
4587.0
3750.0
4031.0
1766.0
953.0
448.0
2009
2Km
2107.0
4349.0
1085.0
303.0
3513.0
11711.0
983.0
4947.0
5153.0
6099.0
2138.0
7653.0
>2Km
3046.0
7777.0
5115.0
Installation
2397.8
6756.7
0
12439.7
1111.0
1328.2
3733.3
633.0
4333.3
2153.9
3000.0
1380.0
1070.8
800.0
2012
2Km >2Km
2164.6 2230.0
4549.8 14719.0
966.7 0
989.5 293557.5
5377.0 0
2017.4
5926.4
0
0
560.0
5993.3
1903.0
436.0
3113.9 0
3906.0 7765.5
2024.5 1761.5
3709.6 0
38782.0 0
1Gbps
Australia
China
Hong Kong
India
Indonesia
Japan
Malaysia
New Zealand
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
Figure 4.2e
1Gbps Ethernet P2P monthly rentals and installation charges, 2009 and 2012
Installation
8152.0
3971.0
0
576.0
6526.0
3750.0
5508.0
2194.0
1970.0
973.0
2009
2Km >2Km
6203.0
24368.0
1867.0
5616.0
38937.0
6807.0
16775.0
6414.0
9968.0 11668.0
13699.0
31283.0
Installation
7543.6
12857.3
0
26834.1
0
413.0
5379.8
758.0
4500.0
2795.6
0
0
0
0
2012
2Km >2Km
5412.6 5768.5
20503.7 71465.0
1646.9
5672.0
0
59811.0
0
3800.0
14745.6
1407.0
0
0
0
8078.0
15732.7
5273.5
2860.0
5984.4
0
0
3379.0
0
0
7563.8
0
0
41
Access Price Benchmarking for APCC 2013
Figure 4.2f
10Gbps Ethernet P2P monthly rentals and installation charges, 2009 and 2012
10Gbps
Australia
China
Hong Kong
India
Indonesia
Japan
Malaysia
New Zealand
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
Installation
4845
2337
2009
2Km
13402
23570
>2Km Installation
1103
0
8,147
0
0
0
0
16900
0
3766
0
413.00
0
2012
2Km
0
0
8,147
0
0
0
0
7907
7420
39288
0
11,000
0
Vietnam is the outstanding example of reported high prices in the five tables above, so far above all the others as to be considered an outlier. Of the others, below 1Gbps the Philippines is the highest in three categories and second highest in the 4 th (10Mbps), followed by Malaysia in three categories and highest in 10Mbps. Some excessively high installation prices are reported, notably for India. The good news is that the overall rental trend is downwards, steadily so for 10Mbps, 100Mbps (two exceptions), and 1Gbps and 10Gbps.
Comparisons show that Hong Kong remains consistently and significantly lower than Singapore;
Japan is higher than South Korea for 2Mbps and 10Mbps, lower for 50Mbps and 100Mbps, and higher for 1Gbps; Malaysia is consistently higher than Thailand up to 100Mbps; Philippines is always ahead of Indonesia which tends to fall marginally below Malaysia.
Figure 4.2 shows 2012 installation charges for P2P Ethernet connections across the range of bitrates. Installation charges generally increase according to bitrate, with some significant rises for 1Gbps, e.g. China, but also some notable falls, e.g. Japan. Interpretation however is difficult without knowing in detail the nature of the contract.
>2Km
0
0
0
0
0
0
0
7907
0
78576
0
0
0
42
Access Price Benchmarking for APCC 2013
Figure 4.2
Note: 1. Prices are simple averages across the available data, in USD;
2. Installation is distributed over 12 months
Data for uncontended PMP Ethernet connections in 2012 was available for 13 economies (not
Indonesia) compared with only eight in 2009. In 2012 data for contended PMP Ethernet connections was reported only from India, compared with five economies in 2009. Reported prices for Malaysia and Thailand stand out as much higher for rentals for 2km contended
Ethernet connections coming 1 st
and 2 nd
for all bitrates, followed by the Philippines. The
Philippines is reported as having a flat rate installation charge of USD5,000 per month which puts it at the top of the table below 100Mbps, after which Malaysia overtakes.
For comparison, Hong Kong is consistently and significantly below Singapore, Japan is marginally cheaper than Korea below 1Gbps, and Malaysia is way higher than Thailand.
43
Access Price Benchmarking for APCC 2013
Table 4.3a
PMP Uncontended
Australia China Hong Kong India Japan
2Mbps
10Mbps
50Mbps
Install
1,851
2Km
705
>2Km
705
Install
3,500
2,228 1,057 1,057 3,500
2,008 2,070 2,070 6,350
2Km
342
1,142
2,806
100Mbps 3,080 2,185 2,185 12,700 3,915
1Gbps 6,503 2,228 2,228 19,050 25,320
10Gbps 16,900 7,907 7,907
>2Km Install 2Km >2Km Install
162 178 1,410
335
736
387
775
1,410
1,410
825 889 1,410
1,404 1,530 1,410
2Km
80
215
868
1,515
9,822
>2Km
80
215
868
1,515
9,822
3,766 78,576 78,576
Install
549
1,090 1,125 1,633
525 1,511 2,567
1,238
2,049
2Km
533
2,265
9,819
>2Km
788
3,531
13,367
2Mbps
10Mbps
50Mbps
100Mbps
1Gbps
10Gbps
Malaysia
Install 2Km
2,217 6,184
4,737 10,086
6,316 11,414
12,632 76,648
>2Km Install
777
847
972
972
1,720
New Zealand
2Km
680
666
928
>2Km
610
889
1,763
1,114 2,578
2,072 11,390
Install
5,000
5,000
5,000
5,000
5,000
Philippines
2Km
560
1,900
3,600
4,600
6,400
>2Km
2,000
3,000
5,200
6,500
8,300
Install
1,511
2,702
3,153
2,898
3,056
Singapore
2Km
533
971
1,610
3,073
4,929
>2Km
Install
2Mbps
10Mbps
50Mbps
100Mbps
1Gbps
10Gbps
222
715
1,346
1,751
1,829
South Korea
2Km
770
1,428
2,919
2,747
7,661
>2Km
770
1,328
2,434
1,368
7,069
Taiwan Thailand Vietnam
Install
629
1,075
2,084
2,088
3,403
2Km
327
740
1,580
2,468
4,901
>2Km
327
740
1,580
2,468
4,901
Install 2Km >2Km
494
494
987
987
887
2,073
5,167
7,176
1,645 30,441
Install 2Km >2Km
210
210
560
560
345
833
1,958
2,543
222
922
1,444
2,569
1,050 17,648 16,584
44
Access Price Benchmarking for APCC 2013
2Mbps
10Mbps
50Mbps
100Mbps
1Gbps
10Gbps
Install
1,410
1,410
1,410
1,410
1,410
3,766
India
2Km
80
215
868
1,515
9,822
78,576
Table 4.3b
PMP Contended
>2Km
80
215
868
1,515
9,822
78,576
45
Access Price Benchmarking for APCC 2013
Price information was reported for the leasing of symmetrical DSL from 11 economies compared with six in 2009, and for asymmetric DSL from six economies compared with eight in
2009.
Tables 5.1a and 5.1b provide data on monthly rental prices and installation costs.
Almost all the data comes from just two economies, Australia and China, with Australia notably higher in rental charges and notably lower in installation charges than China. For 1000kbps symmetric,
Indonesia is three times higher priced than Australia, and Singapore slightly under Australian prices. Hong Kong prices are by far the lowest. Prices in the remaining economies are all moderately low in comparison.
Table 5.1a
DSL Symmetric
Downlink/
Uplink
(Kbps)
Malaysia Philippines Singapore
Rent
Install ation Rent
Install ation Rent
Thailand
Install ation Rent
Vietnam
Install ation Rent
Install ation
512/512
640/640
768/768
1000/1000
1024/1024
1538/1538
2000/2000
200 600 120 100
369
465
481
540
595
595
650
540
370 200
200 200
46
Access Price Benchmarking for APCC 2013
Downlink/Uplink
(Kbps)
Australia
Rent
China
Install ation Rent
Hong Kong
Install ation Rent
64/64
128/128
256/256
384/384
512/512
640/640
768/768
1000/1000
1024/1024
1538/1538
2000/2000
2048/2048
2200/2200
2700/2700
3072/3072
3200/3200
3500/3500
4000/4000
4500/4500
6000/6000
10M/10M
950 504 233 2275
501 336 248 2275
507 336 262 2275
74 120
387 451 299 2300
517 336 254 2200
950 551 313 2275
555 617 254 2200
565 551 333 2275
390 451 348 2275
473 451 362 2653
419 551 246 2466 57
605 336 254
950 551
623 617
950 551
950 551
705 617 1111 1587
950 551
2286 6250
8000/8000 950 551
1.2Mbps/1.2Mbps
950 551
1.55Mpbs/1.55Mbps
45Mbps/45Mbps
155Mbps/155Mbps
622Mbps/622Mbps
4M/4M
6M/6M
8M/8M
5029
10000
2571 9524
5587
16008
9524
9524
133
164
215
231
India
Install ation Rent
1080 2500
Indonesia
Install ation Rent
Japan
Install ation Rent
Install ation
1600 1200
171 257
31
47
Access Price Benchmarking for APCC 2013
Figure 5.1b
DSL Asymmetric
Downlink/
Uplink
(Kbps)
Australia
Rent
Installa tion
256/64
512/128
2048/384
128/512
2048/512
4000/1024
128/256
256/512
512/1024
768/2048
768/4000
768/6000
2000/2200
8000/1000
1538/640
40
58
90 120
172 750
120
401
4000/512 117 682
6000/640 130 682
8000/640 138 682
12Mbps/640
148 682
Rent
China
Installa tion
407 223
Hong Kong
Rent
Installa tion
Rent
Japan
Installa tion
77 51
107 195
Singapore
Rent
Installa tion
Taiwan
Rent
Installa tion
90 150
108 150
120 150
130 150
190 150
250 150
522 650
80 80
48
Access Price Benchmarking for APCC 2013
As with the case of simple leased circuits, installation prices as a proportion of annual rental costs as shown in Tables 5.2a and 5.2b have risen over those of 2009 when for symmetric they did not exceed 17% and for asymmetric 0.6%. In 2012, for symmetric in the case of Malaysia they reach 25% and exceed 10% in five cases. For asymmetric in 2012 they are close to 40% in
Australia.
Figure 5.2a
Installation charges as a percentage of annual rental (symmetric)
49
Access Price Benchmarking for APCC 2013
Figure 5.2b
Installation charges as percentage of annual rental (asymmetric)
50
Access Price Benchmarking for APCC 2013
Following the 2012 report, Figures 6.1a and 6.1b compare leased line prices with Ethernet access prices, noting (as in the 2009 report) that although they are not necessarily substitutes many companies may be considering moving over to all-IP platforms in the future.
Figure 6.1a
2 Mbps Leased Line vs. 2Mbps Ethernet
51
Access Price Benchmarking for APCC 2013
Figure 6.1b
155 Mbps Leased line vs. 100 Mbps Ethernet
In 2012 2Mbps leased line prices appear to higher in most economies, except Australia, Hong
Kong, the Philippines and Vietnam. In Vietnam, the outlier, they are half the price. By contrast in Indonesia and Japan leased line prices are over twice Ethernet prices. Leased line prices for
155Mbps are consistently higher than Ethernet prices or, in the case of Vietnam, almost on a par. Therefore, besides some apparent correlation between price differentials and bitrates there seems to be no other discernible relationship between them. Roughly the same pattern of price differentials held true in 2009, but in 2012 overall prices were very slightly lower.
52
Access Price Benchmarking for APCC 2013
Compared with the 2009 report, the data reported in 2012 indicates that despite overall price falls, Indonesia and Malaysia have been joined by Vietnam as showing consistently higher prices across most categories of leased circuits, and by the Philippines for Ethernet prices. An interesting downwards trend in prices takes place in India and continues in China. Installation costs seem to have come down in proportion to annual rentals as the average across all economies is 8.8% in 2012 compared with 8.9% in 2009. However, see Appendix Table 8 for an alternative method of estimation.
Although by no means the highest priced economies, the data taken at face value for Australia and New Zealand shows remarkable price increases over 2009 of 38% and 28% respectively.
Using the 2009-equivalent price deflator actually increases the price levels. However it needs to be pointed out that in the case of Australia, if the data from the highest reporting carrier is removed from the higher speeds (34Mbps, 45Mbps and 155Mbps – there were 3, 4 and 3 carriers respectively reporting these bitrates) the average nominal price increase drops to just
2%. In the case of New Zealand, only one carrier reported across 5 bitrates and one carrier reported at a single higher speed, so the data is very thin.
Table 7 compares economies that are often benchmarked against each other
Comparing economies: Table 7
Australia and New Zealand Australia lower for leased circuits but higher for Ethernet
Hong Kong and Singapore Hong Kong consistently lower
Indonesia and Philippines
Japan and South Korea
Malaysia and Thailand
Indonesia higher for leased circuits but lower for Ethernet
Japan lower for some leased circuits, higher for some Ethernet
Malaysia consistently higher
Indonesia and Malaysia, the highest priced markets for leased circuits in 2009 and in 2006, have been joined in 2012 by Vietnam. Deflating nominal prices into 2009-equivalent “real” prices does not change their ordinal standing.
Despite some individual price increases for various bitrates (for example, prices in India rose for the lower bitrates and in the Philippines they rose for 4 separate bitrates) overall prices have fallen as shown in Figure 3.3.1. For example, Indonesian prices have fallen on average by 22%.
53
Access Price Benchmarking for APCC 2013
An interesting reversal of trend is the average nominal price fall in India despite price increases for the lower band leased circuits. A conversion to real (2009 equivalent) prices reduces prices by a further 40%. The 2009 report recorded prices in India appearing to rise substantially over 2006 prices, but the trend in 2012 is reversed.
China continued a steady downward trend; 14% overall price reduction in 2009 and 12% in
2012.
Interpretation of Figure 3.3.6a suggests there may have been weaker weighting in favour of lower prices than in 2009, or in other words, possibly fewer lower-priced circuits in use or fewer discounts for bulk leasing on those circuits.
For groomed circuits, in 2012 of the 14 economies, seven showed price premiums of over
50% for simple leased circuits, compared with one economy (New Zealand) in 2009.
Altogether there were eight economies showing positive mean average premiums (Japan the highest) but significant price discounts in China, the Philippines, Singapore and Vietnam.
Reported installation charges as a proportion of the first annual leased line rental are very similar to 2009, averaging 8.8% of the annual rental charge compared with 8.9% in 2009.
However, see Appendix Table 8 for an alternative method of calculating the percentage.
Table 7a: Comparing economies Simple Leased Circuits
Australia
Hong Kong
Indonesia
Japan
Malaysia
New Zealand Australian prices are consistently lower
Singapore Hong Kong prices are consistently lower
Philippines Indonesian prices are consistently higher
South Korea Japanese prices under 45Mbps are lower, then higher
Thailand Malaysian prices are consistently higher
Vietnamese prices are so far above all others as to make it an outlier. Of the others, the
Philippines is by far the overall highest, followed Malaysia, but Malaysian prices are down by quite large margins from 2009 levels. By contrast prices reported in the Philippines are substantially above 2009 levels except for 1Gbps. Overall, 2012 prices are down, in some
54
Access Price Benchmarking for APCC 2013 cases substantially down, from 2009 levels. For example, in South Korea the reported price for 2Mbps is down from US$1,674 to US$574.
Some excessively high installation prices are reported, notably for India. Overall, there are
27 recorded cases of installation charges increasing and 21 cases decreasing, a rather mixed picture. They generally increase according to bitrate, with some significant rises for 1Gbps, e.g. China, but also some notable falls, e.g. Japan. Interpretation however is difficult without knowing in detail the nature of the contract.
Table 7b: Comparing economies for Ethernet P2P
Australia
Hong Kong
Indonesia
Japan
Malaysia
New Zealand
Singapore
Philippines
Australian prices are consistently higher
Hong Kong prices are consistently lower
Indonesian prices are consistently lower
South Korea Japanese prices higher for 2Mbps, 10Mbps, 1Gbps and lower for 50Mbps and 100Mbps
Thailand Malaysian prices are higher up to 100Mbps
Data for uncontended PMP Ethernet connections in 2012 shows prices for Malaysia and
Thailand as much higher for rentals for 2km uncontended Ethernet connections coming 1 st and 2 nd
for all bitrates, followed by the Philippines. The Philippines is reported as having a flat rate installation charge of USD5,000 per month which puts it at the top of the table below 100Mbps, after which Malaysia overtakes.
Table 7c: Comparing economies for Uncontended PMP
Australia
Hong Kong
Japan
Malaysia
New Zealand Australian prices are consistently higher
Singapore Hong Kong prices are consistently lower
South Korea Japanese prices marginally lower below 1Gbps
Thailand Malaysian prices consistently higher
55
Access Price Benchmarking for APCC 2013
Almost all the data (Tables 5.1a and 5.1b) comes from two economies, Australia and China, with Australia notably higher in rental charges and notably lower in installation charges than
China. For 1000kbps symmetric Indonesia is three times higher priced than Australia and
Singapore slightly under Australian prices. Hong Kong prices are by far the lowest. Prices in the remaining economies are all moderately low in comparison.
As with the case of simple leased circuits, installation prices as a proportion of annual rental costs as shown in Tables 5.2a and 5.2b have risen over those of 2009 when for symmetric they did not exceed 17% and for asymmetric 0.6%. In 2012 for symmetric in the case of
Malaysia they reach 25% and exceed 10% in five cases. For asymmetric in 2012 they are close to 40% in Australia.
In 2012 2Mbps leased line prices appear to higher in most economies, except Australia, Hong
Kong, the Philippines and Vietnam. In Vietnam, the outlier, they are half the price. By contrast in Indonesia and Japan leased line prices are over twice Ethernet prices. Leased line prices for 155Mbps are consistently higher than Ethernet prices or, in the case of Vietnam, almost on a par. Therefore, besides some apparent correlation between price differentials and bitrates there seems to be no other discernible relationship between them.
56
Access Price Benchmarking for APCC 2013
A more weighted approach to estimating the average proportion of installation charges to first year leased line rentals is to average per bitrate and then take the mean average of these averages. Figure 8 shows the results. In the case of China the percentage rises to 61% and generally installation charges rise as an overall proportion of annual rentals to 14.8% compared with 8.8% using the methodology of 2009.
57