Telecommunication Challenges in Asia:

A roundtable dialogue

14-15 June 1995Hongkong

“Multimedia and convergence

What converges in convergence?”

Michael MingesInternational

Telecommunication Union

Topics

• Multimedia and covergence• Asian Information Society• Benefits• Visions & Strategies• Regulation

Multimedia

• Integration of voice, text, image, data and video applications.

• Multiple interpretations. In the telecom’s world, the development of networks (i.e. information infrastructures / information superhighways) capable of supporting multiple information types.

What is convergence?

• Technical - Voice, text, data, image and video can all be converted to digital format

• Organizational - telecommunications, broadcasting & computer companies are entering each others’ domains

• Societal - Businesses and households are consuming more types of information

converge v.i. come together or towards the same point. - The Little Oxford Dictionary

The Asian Information Society

• Growing service sector• Growing information usage• Growing household information consumption• Growing share of economy

The Asian economy

Hongkong

Singapore

Thailand

Philippines

India

China

77%

63%

47%

43%

41%

25%Services share of GDP

1993

Source: Asian Development Bank.

The information economy

Thailand

Indonesia

Philippines

Malaysia

Japan

Singapore

10%

11%

12%

14%

19%

26%

Primary info-sectorShare of GDP, 1975-76

Source: ITU.

Home information equipment

10

100

100019

83

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

Developing Asia-Pacific countries, millions

TVs

Home telephone lines

Source: ITU.

Info-Communications sector

5%

6%

7%

8%

9%

10%

11%19

80

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

Share of Info-communications sector in GDP, Japan

Source: Ministry of Posts and Telecommunications, Japan.

Benefits of info-infrastructures

• Social• Economic

China

Thai-land

India

Malay-sia

Korea(Rep.)

57%

55%

50%

42%

26% % school agenot enrolled

Health & Education

China

Indo-nesia

Philip-pines

Thai-land

Lao

10%

20%

25%

30%

33%

Source: UNDP.

% of populationwithout accessto health service

Service sector development

Source: Department of Electronics, India.

1989 1990 1991 1992 1993

113 123

220

270

189

India's computer software exportsUS$ m

Foreign Direct Investment (FDI)

Source: ITU.

Teledensity

FDI p

er c

apita

(US$

)

$ 1

$ 10

$ 100

$ 1'000

$ 10'000

1 10 100

FDI and Teledensity1992

Log scale.

Pakistan

Thailand

Malaysia

Singapore

Brain Drain Reversal

Source: Institute of International Education.

050

100150200250300350400450500

1976 1980 1985 1990 1991 1992 1993

Asia Other regions

Foreign student enrollment in US universities (000s)

Capital costs per paying subscriber, US$, 1994

Traditional Hybrid telephone fibre/coaxialComponent technology cable

Wiring 1,000 - 1,500 180 -250Switching 150 - 200 150 - 200Electronics 0 370 - 530

Total capital costs 1,150 - 1,700 700 - 980

Leap frogging

Source: First Pacific Networks.

Visisions & strategies

• Governmental– The Global information infrastructure (Gii)– The Asian information infrastructure (Aii)– National information infrastructure (Nii)

• Business

• ITU World Telecommunication Development Conference, March 1994 (according to US)

– Private investment– Competition– Open access– Flexible regulatory environment– Universal service

• G-7 Information Society Conference, Brussels, February 1995

Global information infrastructure

• Asia Pacific Telecommunity• Asia-Pacific Economic Co-operation Forum

Asia information infrastructure

• China - Informatization of the Domestic Economy• Japan - Reforms toward the Intellectually Creative

Society of the 21st Century• Korea (Rep.) - National Information Superhighway

System• Singapore - IT2000:The Intelligent Island

National info infrastructures

SingaporeIT 2000: The Intelligent Island

• A global hub• Improve quality of life• Economic growth• Linking locally and globally• Knowledge building

China: The 3 Goldens

The GOLDEN Bridge The GOLDEN Card The GOLDEN Customs

Corporate strategies: From voice to multimedia

“By 1998, businesses’ and governments’ use of data communications will exceed their use of voice services.” MCI

Fax and data traffic

Source: Hongkong Telecom.

Min

utes

m

020406080

100120140160180200

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

0%2%4%6%8%10%12%14%16%18% Fax & data as %

of totalHongkong's outgoing fax& data traffic

As % of total traffic

Data traffic

1989 1990 1991 1992 1993

1.5

2.2

3.5

4.3

2.9

Telekom Malaysia'soutgoing data traffic

(Minutes m)

Source: Telekom Malaysia.

Data revenuesUS

$ m

0

25

50

75

100

125

150

1988 1989 1990 1991 1992 1993 19940%1%2%3%4%5%6%7%8%9%10%Singapore

Telecom'sdata revenues

As % of total revenues

Source: Singapore Telecom.

ISDN

Economies with ISDN, 1993

Asia-Pacific Rest ofworld

9

13

Note: ISDN=Integrated Services Digital Network.Source: ITU.

Value-added services

1990 1991 1992 1993 1994

520874

2'832

5'010

1'374

DACOM (Korea)EDI subscribers

Note: EDI=Electronic Document Interchange.Source: Dacom Corp.

Fibre-optic

• Drivers– Region geographically well-suited– Expanding communication traffic– Growth triangles

• Initiatives– APC– ASEAN– APCN– Bi-lateral

Internet

Source: Internet Society.

Australia

Regionavg.

India

Malaysia

Thailand

80%

109%

160%

269%

526%

Internet host computersAnnual growth 1993-94

Source: News Corp.

Multichannel TV

1991 1992 1993 1996

845

400

173

STAR-TV Viewers (m)

Regulation

• Role of government• Competition• Universal access• Content

Role of state

• Information vision• Regulatory convergence• Informatize its own functions

Competition

Cellular Wireline

31

237PhilippinesMonthly subscription charges

Pesos

5 competitors0 competitors(at that time)

Note: Cellular is for 1994, includes 20 minutes of airtime. Wireline is for 1993, includes free local calls.

Source: Smart, PLDT.

Multimedia Universal Service

• A broadband line?• Internet access?• Who?• Tariffs?

Content

• Content– Pornography, violence, politics, culture

• Intellectual property– Content poverty

Digital Babies

“...the digital haves and have-nots will be less concerned

with race or wealth andmore concerned with age.

Developing nations will leapfrog the

telecommunications infrastructures of the First World and become more

wired.

Consider Germanyand Mexico. Less than half of

all Germans are under 40; more than half of all

Mexicans are under 20. Which of those nations will

benefit first from ‘being digital’? ”

— N. Negroponte, Director MIT Media Lab

Germany

Developed

Mexico

Japan

Indonesia

Thailand

Malaysia

Hongkong

37%

65%

68%

72%

77%

79%

87%

100%

% digitaltelephone

lines1993

Being digital

Source: ITU.

Digital babies

Source: U.S. Bureau of the Census.

Indonesia

India

Mexico

China

USA

Germany

Japan

4%

4%

5%

7%

13%

17%

17%

% of population65 years old and over,

2000 proj.