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    Broadband booming in rich nations: report
    September 17, 2003

    Broadband technology offering fast and cheap access to the internet is booming in richer countries but slow to spread in the developing world, according to a United Nations report issued yesterday.

    But the report, from the world body's International Telecommunications Union (ITU), showed the spread of broadband was lagging in many European states where lines are still controlled by former state monopoly providers.

    Developing countries are far behind, though a project in India to use some 65,000 km of cable along the extensive rural rail network to set up links for remote communities showed what can be done, the ITU said.

    "Broadband is arriving at a time when the revolutionary potential of the internet has still to be fully tapped," said Tim Kelly, who heads the ITU's Strategy and Policy Unit.

    Evidence from around the globe indicated that monthly spending on telecommunications services rose when broadband was easily available, the report said.

    The number of subscribers to broadband technology, the third generation since early internet use through normal telephone lines gave way to higher-speed or ISDN lines, grew 72 per cent last year and now totals 62 million, it said.

    By far the greatest penetration is in South Korea, where over 21 per cent of the population - 94 per cent of the country's 10.8 million internet subscribers - are hooked up through broadband.

    Between 60 and 70 per cent of all households in South Korea have a broadband connection, and cybercafes where students play online games are "almost on every corner," said Taylor Reynolds, one of the authors of a report by the International Telecommunication Union .

    "Broadband is just an essential part of everyday life. They use it for e-mail, they use it for chat, for music, all sorts of things," said Reynolds.

    Hong Kong is next with 15 per cent of the population using broadband, 43 per cent of the 2.4 million internet users, and Canada third with just over 11 per cent, exactly half the 5.6 million people who have signed up for online services.

    In the United States, the ITU said, some seven per cent of the population, nearly 20 million of the 70 million internet subscribers, are now on broadband - a penetration level just below that of Japan.

    But Japan, where there is fierce competition between a wide range of providers, offers by far the fastest and cheapest broadband services, costing 35 times less in terms of access and download speed than in the United States.

    The ITU calculation of comparative cost is based on the time it takes to access and download an identical item - for example a film or a computer game - from an on-line multi-media site.

    A Japanese user can download an entire movie over the internet in 20 minutes. South Korea is almost as fast - 26 minutes.

    "You can download a movie faster than you can watch it," said Reynolds.

    But the rest of the world is considerably slower. It takes six hours to get a movie in the United States and 12 hours in Switzerland. For somebody trying to download it over a standard dial-up modem, it would take 7 days.

    Reynolds said a key reason why Japan and South Korea are so far ahead is because of heavy competition among broadband providers. Also, the Japanese and South Korean governments have taken steps to encourage use of broadband, such as requiring telephone companies to let competitors use existing lines at low cost.

    "In economies where there is effectively no competition, where there is no choice except for the incumbent operator like Swisscom (in Switzerland), prices are going to be higher and the speeds are going to be lower," he said.

    In France, where the former sole provider France Telecom still dominates the telecommunications business, broadband services are 100 times more expensive than in Japan, in Switzerland they cost 110 times more.

    In Britain, one of the first EU countries to deregulate the industry, the cost remains around 64 times that of Japan, while in Luxembourg a broadband subscriber effectively pays 180 times more than a Japanese counterpart.

    Reynolds told a news conference the disparity was due partly to the fact that line providers in many European countries had invested heavily in money-spinning ISDN technology.

    In contrast to broadband, where normally the only charge is a monthly subscription, ISDN subscribers pay additional charges for line use.

    "The telephone companies have been making a lot of money and don't want to give that up," Reynolds said.


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