The Average Cost Per Megabit by Broadband ISP Technology for 2012

Point Topic UK has published its latest Q4-2012 analysis of global standalone and bundled broadband tariffs, which found that residential consumers in Western Europe pay the lowest for cable broadband based ISP services. But consumers in the Asia-Pacific region still get the best deal for fibre optic (e.g. FTTH) and older DSL services.

Globally the average monthly charge for residential broadband services in Q4-2012 was £48 ($72.52) and the average advertised connection speed provided by residential services was 36Mbps (Megabits per second). As a result the telecoms analyst concludes that the average global cost per megabit (Mb) was just over £1.32 ($2) at the end of last year.

Prices for the most common form of copper based fixed line connectivity, DSL, have been up and down like a yo-yo but it remains the most expensive technology in terms of the average cost per megabit. By comparison the faster cable and fibre services deliver more speed for a lower comparative price, although only cable has seen a steady decline in price.

It’s interesting to see how this pricing is broken down when the data is split up into different parts of the world. In particular we note that the new generation of superfast fibre optic (FTTP/H etc.) broadband products in Western Europe are almost as cheap as they are in the Asia-Pacific region, albeit perhaps for different reasons.

A number of Asia-Pacific markets, such as South Korea, already have mature fibre competition and coverage, which has helped to drive prices down. By comparison Europe is still struggling with FTTH, both in terms of availability and uptake, thus its pricing could perhaps be seen as both a reflection of the threat from an aggressively competitive DSL market and the desire to push uptake.

Unfortunately Point Topic’s free analysis doesn’t split the “Fibre” technologies up so that we can see how hybrid-fibre (FTTC / VDSL) compares with true fibre (FTTH / FTTP) services. But the slower hybrid solutions (speeds tend to hit around 100Mbps at best) are known to dominate in Europe.

“One of the major criticisms of the Western Europe hybrid approach is that beyond 100Mbps supply will be very difficult and expensive. Western Europe may be forced into a second fibre build out earlier than expected, or will find themselves within the slow lane in 3-5 years time,” said Point Topic.

Separately Point Topic has also produced similar data for business broadband services, which tend to be dominated by DSL and Fibre solutions in Western Europe where related prices are around four times higher per megabit than their domestic counterparts. But curiously business based cable broadband in Western Europe is only slightly higher than the domestic equivalent (here).