Asia leads mobile growth, but lags on Internet

BANGKOK Thu Sep 4, 2008 3:44am EDT

In this file photo a Chinese worker tests mobile phones at a production line of Ningbo Bird Co. Ltd in the eastern port city of Ningbo February 19, 2004. Asia will continue to deliver strong growth in the mobile phone market due to sustained demand from China and India, the world's two biggest markets of such services, industry officials said. REUTERS/Claro Cortes IV

In this file photo a Chinese worker tests mobile phones at a production line of Ningbo Bird Co. Ltd in the eastern port city of Ningbo February 19, 2004. Asia will continue to deliver strong growth in the mobile phone market due to sustained demand from China and India, the world's two biggest markets of such services, industry officials said.

Credit: Reuters/Claro Cortes IV

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BANGKOK (Reuters) - Asia will continue to deliver strong growth in the mobile phone market due to sustained demand from China and India, the world's two biggest markets of such services, industry officials said.

But, even if Asia is the world's largest broadband market in terms of absolute numbers, it lags the United States and Europe in overall penetration, with just 3.6 out of every 100 inhabitants connected to the high-speed Internet, the International Telecommunication Union (ITU) said in a report.

The ITU, which groups companies and official bodies from 191 countries, held an industry conference in Bangkok this week.

The Asia Pacific region has about 1.4 billion mobile phone subscribers, representing 42 percent of the global market, and it is expected to exceed 50 percent within the next two years, Hamadoun Toure, secretary-general of the ITU, said.

India and China combined have total cellphone subscribers of about 900 million, accounting for a quarter of the world total.

"Every month, India adds 9 million new subscribers and more, which is higher than China. We hope the excitement will continue," said N.K. Goyal, president of consultant group Communications and Manufacturing Association of India.

But if India is the world's fastest-growing mobile phone market with nearly 300 million subscribers, only 11 million people in the country have access to the Internet.

While developed markets like South Korea and Singapore are among the world's top 10 economies for household broadband access, most of the low- and lower-middle-income economies in the Asia Pacific region have limited and costly access to Internet.

"Despite Asia's reputation as an ICT (Information and Communication Technologies) powerhouse, many countries in the region are still struggling to connect their communities to affordable basic services," Toure said.

Developing countries in Asia should speed up plans to develop high-speed broadband Internet access, including making spectrum available and creating investment incentives, the report said.

To serve growing demand for mobile data services, which is driven by things like smart phones and embedded laptops, operators are focusing on new ways to boost value-added services.

Wang Jianzhou, chairman and CEO of China Mobile, the world's biggest mobile carrier, said his company was banking on the development of new-generation wireless technologies such as Long-Term Evolution (LTE), which promises to speed up everything from mobile video sharing to music downloads.

Over a third of China Mobile users uses their handsets to listen to music, much higher than in the United States, Britain, France and Germany, the ITU report said.

"Surely it is Asian operators who will be among the first to exploit the technological potential of LTE, translating it into real-world services, revenues and customer numbers," said Jean-Pierre Bienaime, chairman of UMTS Forum, an organization aimed to promote the uptake of advanced mobile technology.

(Editing by Alan Raybould)

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