ITU Finds World Broadband Prices Fall 75 Per Cent Between 2008 and 2011

The International Telecommunication Union has revealed that the average price of fixed line telephone, mobile (cellular) and fixed broadband Internet services around the world has fallen by 30% between 2008 and 2011 (-75% for fixed line broadband alone). Meanwhile telecoms revenues climbed and the UK improved its global rank.

The data forms part of the ITU’s latest annual Measuring the Information Society 2012 report, which ranks countries around the world by their Information and Communication Technology (ICT) development and uptake. Interestingly the UK is now ranked 5th in the world behind South Korea, Sweden, Finland and Japan (ICT Development Index – IDI), which is up from 9th in 2011 and 14th in 2010.

In terms of revenue from telecommunication services the UK is ranked as the 7th largest market behind the USA, Japan, China, Brazil, Germany and France. Global telecoms revenue grew to $1.5 Trillion (£935m) in 2010 (corresponding to 2.4% of the world’s GDP), which is relatively small but its “contribution to productivity growth can be significant“. By contrast investment (measured by capital expenditure) in telecoms amounted to more than $241 billion (£150bn) or an estimated 2% of the world’s total gross fixed capital formation.

Between 2007 and 2010, both telecom revenues and investment continued to grow by 22% in developing countries, whereas revenues stagnated in developed countries. It should be said that the UK and Europe have recently begun a major drive to boost broadband coverage and speeds, which will begin to show up in future ITU reports.

Brahima Sanou, Director of ITU’s Telecom Development Bureau, said:

“The past year has seen continued and almost universal growth in ICT uptake. The surge in numbers of mobile-broadband subscriptions in developing countries has brought the Internet to a multitude of new users. But despite the downward trend, prices remain relatively high in many low-income countries. For mobile broadband to replicate the mobile-cellular miracle and bring more people from developing countries online, 3G network coverage has to be extended and prices have to go down even further.”

Indeed there are now twice as many Mobile Broadband subscriptions as fixed line broadband ISP customers worldwide, with mobile internet solutions growing at 40% over the past year (rises to 78% in developing countries). It’s easy to see why mobile is more popular in developing countries because fixed line broadband is still too expensive. By the end of 2011 the monthly price of a basic fixed line broadband connection represented over 40% of monthly gross national income (GNI) per capita (i.e. it’s just 1.7% in developed economies).

ITU Measuring the Information Society 2012 (PDF)
http://www.itu.int/ITU-D/ict/publications/idi/material/2012/MIS2012..pdf