16 Oct 2014
Singapore Show Confirms Asia's Lead Role in Mobile Communications
With Asia now accounting for some 50% of the world's mobile subscriptions, the region has become the global focus for the continuing growth of the sector, according to many attendees and exhibitors at this year's CommunicAsia event.
Asia is now a truly global hub when it comes to telecoms, a fact boldly underlined at Singapore's recent CommunicAsia, BroadcastAsia and EnterpriseITAsia exhibitions, three key event on the international communications calendar. Now representing more than 50% of the world's mobile subscriptions, the religion is set to remain the fastest developing well into 2020.
Given that three quarters of these subscriptions are in just four countries – China, India, Japan and Indonesia – the potential for further expansion remains enormous. This, of course, means big money. A report by GSMA Intelligence, a global market research consultancy, estimated that the mobile industry contributed US$864 billion to the region's economy last year.
Addressing delegates at the opening ceremony, Singapore's Minister for Communications and Information, Yaacob Ibrahim, spoke of the country's goal of being the world's first "smart nation," defining the Internet of Things (IoT) as a national priority. Expanding on his theme, he said: "We aim to bring together a nationwide sensor network and data analytics ability, provide better situational awareness through data collection and the efficient sharing of collected sensor data. In this way, we hope to better understand the needs of residents and businesses, so as to improve their lives."
The Minister's sentiments were echoed by was Khoong Hock Yun, Assistant Chief Executive of the Infocomm Development Authority, who said there was already a 1GB fibre optic pipe to 95% of homes in the country, with half of them now next generation broadband subscribers.
Citing the Authority's future plans, he said: "We intend to build a wireless mesh across the whole country to facilitate public safety, education and monitoring. Part of the required bandwidth will come from the release of 180MHz of unused TV white space for wireless use from September 2014."
IoT was one of the core themes explored at CommunicAsia. This interconnection of embedded computing devices within the Internet infrastructure includes such applications as making homes "smart," connecting cars, farm equipment and factory machinery. It also refers to wearable devices, such as watches and glasses, wearable monitoring such as FitBit, and devices that can, for example, detect air quality or even monitor the health of individual sheep.
It's not just Singapore that is looking forward, however, with the entire region said to be moving up the value chain from basic services to mobile broadband. A recent Ericsson Mobility Report showed that, last year, 75% of subscriptions in Asia were 2G. By 2019, it predicts that 80% will be 3G and 4G, with a number of key markets, notably Japan and South Korea, leading the race to 4G. China, alone, is expected to account for 25% of the world's 4G subscriptions by 2019.
The state of play in the region however remains diverse. With its population of 65 million and with little existing infrastructure, Myanmar is considered the last frontier of opportunity in Asia. One of the winners in the bid to build the country's telecoms network in 2013 was Ooredoo, the Qatar-based communications giant. Its presence at this year's event, understandably, excited considerable interest about its plans for Myanmar.
According to Carson Wolfer, Head of Business Development, Partnerships & CSR, despite the severe challenges ahead, Ooredoo plans to deliver 97% coverage of the country within five years. He said: "Every day is uncharted territory, not only because the industry, economy and eco-system are in their early days, but so too are regulatory and ministerial oversight.
"Internet penetration is at only 1%. The 2G/3G network is fairly well-established in the core cities of Yangon, Mandalay and Nay Pyi Taw, but is nearly non-existent in the rest of the country. In some areas, the challenges are not only the lack of supporting infrastructure, such as electricity and roads, but also continuing conflicts."
In the middle of the developing pack of Asian countries is the massive market of Indonesia. Assessing the opportunities on offer, Luqman el Hakiem, Head of the Digital Service Business Unit of Huawei Technologies, said: "Some 75% of mobile users do not have access to a smart device, so the emphasis is on the mobile web, rather than mobile apps. This will be the emphasis for at least the next few years. Indonesian consumers, like consumers across the region, are moving to 24/7 access, from voice to data, from simple information to multimedia, from person-to-person, to group communications."
Taking the example of the more advanced countries, Ross Patterson, Chairman of New Zealand's Akhet Consulting, a specialist telecom consultancy, said there were a variety of models that countries can adopt when it comes to rolling out next generation broadband. He said: "In Hong Kong, the authorities have not spent on broadband. Singapore invested US$800 million, New Zealand US$1.16 billion and Australia, US$35 billion. This reflects the different priorities of each market."
Paterson said that, while Hong Kong was a private sector rollout, Singapore's model is private with state-funded incentives. New Zealand, by contrasts, is a private-public partnership whereas, in Australia, the broadband network is state-owned and operated. The adoption of broadband in Hong Kong and New Zealand have been left to market forces while, in Singapore, the providers are given incentives. In Australia it's now mandatory, with copper connectivity being progressively discontinued.
Explaining the lessons to be learnt, Paterson said: "The experiences and results of each country are different. It's obviously easier and faster in the city states, but the broad lesson that can be drawn is that some level of government investment and incentive is better. The proper communication of benefits to end-users is also needed, especially in the critical first 18-24 months."
Speaking at the event, Tom Zack, president of EMC Southeast Asia, a specialist in business transformation, believes there is huge shift underway. He said: "The IT industry has spent the past 20 years connecting people to the Internet. Now the net is transforming into the Internet of Things."
One outcome of this will be that the amount of data usage will skyrocket from the current 4.4 zetabytes, to 10 times that figure over about six years, according to Zack. Given that the number of industry professionals will probably double, at most, he believes there is no way to manage or make proper use of this amount of data, save by investing heavily in data analytic tools and cloud-based services.
Ricky Kapur is Managing Director of Google's Enterprise Business in Asia. He believes that, in the future, consumers will always be connected via multiple devices, from a network of computers, to a network of people. He said: "We project there that will be 30 billion connected devices by 2020, from about three billion today. In line with that, cloud services will be worth US$191 billion."
Viktor Mayer-Schönberger, professor of Internet governance and regulation at the Oxford Internet Institute, part of the University of Oxford, sounded a cautionary note, however. He said we are not prepared for the impact of big data and the IoT, especially in terms of their likely their predictive capabilities.
He said: "Current privacy policies are now focussed on how data is collected, rather than how it is used. The scary and predictive world of The Minority Report [a 2002 sci-fi film starring Tom Cruise] is precisely where we are heading and our policies are inadequate. Unless steps are taken, consumers will have major trust issues in the future with telcoms, governments and retailers."
Craig Law-Smith, Head of Strategy and Business Development Global Advertising at SingTel, the Singapore-based mobile phone operator, was broadly in agreement. He believes retailers need to change their operating procedures in order to deal with this new reality, saying: "We see something like three to 5,000 ads every day and we don't notice them anymore.
"Ads can be confusing, intrusive and irrelevant. This needs to change, especially when consumers can choose to opt out. Ads need to be about making a connection with a brand and need to be where consumers are looking. There are about four times as many mobiles as TVs in the world, yet mobile ad spend is only 1% of the total. The effective use of data analytics can also make ads much better targetted, based on where the desired audience works, what they watch, what they like to do, etcetera, rather than the wasteful 'spray and pray' method still in use today."
CommunicAsia2014 was held concurrently with EnterpriseIT and BroadcastAsia2014 at the Sands Expo & Convention Centre from 17-20 June 2014. Between them, the events attracted 1,946 exhibitors from 55 countries, slightly down on last year's figures of 2,044 companies from 56 countries.
Ronald Hee, Special Correspondent, Singapore