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Southeast Asian broadband providers report varying performance amid COVID-19

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Southeast Asian broadband providers report varying performance amid COVID-19

Highlights

The following post comes from Kagan, a research group within S&P Global Market Intelligence’s TMT offering.

To learn more about our TMT (Technology, Media & Telecommunications) products and/or research, please request a demo.

Fixed broadband providers in Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam recorded varying subscriber growth patterns during the first half of 2020 as the region faced COVID-19-related challenges. Nevertheless, none of the operators discussed in our analysis suffered subscriber losses during the course of the pandemic as of June 2020.

The COVID-19 pandemic posed as an additional obstacle for developing Southeast Asian markets to increase broadband penetration as a region already hampered by an apparent digital divide. Kagan estimates only about 28% of households had fixed broadband in Southeast Asia in 2019, or about 44.8 million out of 161.5 million occupied households.

Click here to read more about Southeast Asia's broadband landscape in 2019.

The pandemic, however, marked fixed broadband as essential due to lockdown implementations requiring the public to stay at home to minimize physical contact. Network traffic shifted to residential broadband as offices began to rely on virtual connections for business continuity, employees moved to work-from-home setups, schools transitioned to online classes and people resorted to internet activities as a form of leisure.

Ookla's June 2020 Speedtest results show Singapore achieved the fastest average broadband speeds among Southeast Asian markets at 208.16 Mbps, while Indonesia ranked the lowest with 21.28 Mbps.

Thailand's average broadband speed jumped by about 41 Mbps during the first half of 2020 as operators launched specialized COVID-19 broadband packages along with the regulator's mandate to ensure a minimum speed of 100 Mbps to fiber subscribers from April 10 to June 30. ISPs in Vietnam increased bandwidth capacity to accommodate heightened network traffic, leading to 35.4% faster average broadband speeds within the first half of the year. The Philippines tells a different story as the prolonged lockdowns strained the country's limited broadband infrastructure, dragging average fixed broadband speeds down by 8.4% from 25.91 Mbps in January 2020 to 23.74 Mbps in June 2020.

To read more about Southeast Asia fixed broadband speeds, please click here.

Broadband demand surged higher for operators in markets with lower penetration. With only 21.1% of households subscribed to fixed broadband in the Philippines as of year-end 2019, de-facto duopoly PLDT Inc. and Globe Telecom faced increased demand during the pandemic as day-to-day functions migrated online. PLDT's subscriber base grew by 14.3% sequentially during the second quarter of 2020, a stark contrast from its 2.1% and 1.3% quarter-over-quarter growth in second-quarter 2018 and second-quarter 2019, respectively. Globe's quarter-over-quarter growth in second-quarter 2020 reached 26.9%, about three to four times faster than its growth rate during the same period in the last two years.

Due to the pandemic and flash floods during the first quarter of the year, Telkom Indonesia's fiber broadband business Indihome retracted its target subscribers from 8.3 million down to 7.7 million by year-end 2020. Aside from a brief increase in fourth-quarter 2019, Telekom Malaysia has been experiencing negative quarterly growth for the past two years primarily due to subscriber churn from Streamyx DSL to unifi fiber migration. However, the telco experienced almost 2% fixed broadband subscriber growth in second-quarter 2020, as unifi's new subscriber additions were enough to offset the Streamyx loss.

Other markets with better coronavirus responses maintained their growth momentum on the same level or at a slightly slower pace. The National Broadcasting and Telecommunications Commission estimates that fixed broadband subscribers in Thailand reached 10.6 million in second-quarter 2020, growing by 3.5% from the previous quarter's 10.3 million broadband subscriptions. Year-over-year subscriber growth in Vietnam has remained stable despite a slight dip in quarter-over-quarter growth. Singapore's broadband growth rate has fluctuated over the years but managed to grow marginally from year-end 2019 to second-quarter 2020 by 0.8%

Global Multichannel is a service of Kagan, a group within S&P Global Market Intelligence's TMT offering. Clients may access the full article, with subscriber growth rates of select fixed broadband providers in Southeast Asia by clicking here.

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