Fixed broadband tariffs – key trends in Q3 2017

Broadband tariff benchmarks for residential and business broadband services

Point Topic compared broadband tariffs across different technologies in Q3 2017, looking at price and speed variations in various parts of the world.

Global fixed broadband tariffs and bandwidths

We have compared the average subscription charges and corresponding bandwidths for different broadband technologies across the world. All prices are quoted in US dollars at PPP (purchasing power parity) rates to allow easier comparison.

Residential broadband packages

In Q3 2017, the average monthly charge for residential broadband services was $112, up from $105 in Q2 2017. It has gone up for two broadband technologies – copper and fibre, but gone down for cable by $4 to $74 compared to the previous quarter. The average bandwidth provided to residential subscribers remained stagnant this quarter – 136Mbps, compared to 135Mbps in Q2 2017.

The average speeds provided over all three technology platforms also remained stable with only cable experiencing a substantial increase to 148Mbps from 143Mbps in Q2 2017. However, the average speeds across all technologies will continue to climb, with a number of broadband providers accelerating the rollout Docsis 3.1 and FTTH networks capable of Gigabit speeds, as well as copper based g.Fast platforms. (For more details on the next generation network upgrades see operator profiles which are part of our Broadband Operators and Tariffs service).

Average cost and download speed

This quarter, the average cost per Mbps has increased on copper and fibre based broadband packages but went down slightly on cable connections. The average ‘global’ cost per Mbps (for all three technologies combined) was $0.82 at the end of Q3 2017, compared to $0.78 recorded at the end of Q2 2017.

Business broadband packages

In Q3 2017, the average monthly charge for standalone business broadband services increased to $214 compared to $197 in the previous quarter. The average bandwidth experienced a slight 1.2 per cent boost compared to Q2 2017. Cable and fibre based business packages experienced an increase in the average bandwidth, however, copper connections remained the same at 13Mbps. In the case of cable, in Q3 2017 the average bandwidth has gone up 2.5% compared to Q2 2017 (+12% between Q1 2017 and Q4 2016). For fibre connections, over the same period the average download speed has increased by 1.7% (+4% between Q1 2017 and Q4 2016).

In terms of average monthly cost, it has increased significantly for all three technologies in Q3 2017 with fibre seeing the largest boost of $33 compared to Q2 2017. The average monthly tariff of copper services continued to increase despite this legacy technology seeing falling take-up figures. (See our Global Broadband Statistics product for more details).

average cost and download speed, business

At the end of Q3 2017, the average global cost per Mbps for business broadband packages grew by nearly 7% and stood at $1.97. The increase in average cost per Mbps of bandwidth provided over all three technologies has contributed to this overall growth.

Regional tariffs and bandwidths

In this section, we have compared the average subscription charges and corresponding bandwidths in different regions across the world. All prices are quoted in international US dollars at PPP rates to allow direct comparison between regions.

Residential broadband packages

Asia-Pacific retained its dominant position in terms of bandwidth as the operators in the region continue to push FTTP services. In Q3 2017, the average bandwidth in this region was 395Mbps. Western Europe followed as it pushed VDSL and, since recently, g.fast. The region saw its average bandwidth grow slightly from 184Mbps in Q2 2017 to 190Mbps in Q3 2017. In term of average monthly broadband tariff, Eastern Europe offered the best value for money, having overtaken Western Europe this quarter.

In Q3 2017, North America saw its average bandwidth go up further by 2% compared to the previous quarter as Canadian and US operators upgraded their speeds and expanded FTTP and superfast cable networks. South and East Asia also saw the average download speeds increase by 11% q-o-q. Countries of Middle East and Africa continued to be the most expensive broadband markets, not least due to the lack of competition in the fixed broadband markets and fixed broadband being strongly overshadowed by mobile.

Residential tariff benchmarks

Business broadband packages

As in the previous quarters, the lowest priced business tariffs were offered in Europe and the Americas. Although being the most expensive market, Asia-Pacific offered the highest average speeds at 424Mbps and the lowest average cost per Mbps of bandwidth at $0.97 PPP.

Business tariff benchmarks

Country ranking

In this section, we look at the average monthly tariff for residential broadband services across the world. The average tariffs include copper, cable and fibre broadband services, and cover both standalone and bundled services.

All tariffs are quoted in international US dollars at PPP rates to allow comparisons between countries.

This isn’t the end of the story when it comes to making a comparison. Different approaches could be applied.  You may want to include bundles in cross country comparisons, though it is not easy to quantify the value of one TV channel versus another, for example.  You could look at a range of services on offer or select a single entry level tariff from the most popular supplier. As ever the answer is to pick whatever best suits your needs.

Entry level, median or average?

We are using the three most common comparison aggregations:

  • The entry level tariff – typically ignores variations in bandwidth caps, time charging, actual bandwidth offered and overall availability of a tariff in the market. Best used to indicate the conditions at the low end of the market and best comparator if you’re looking at the market penetration for broadband overall or a particular technology.
  • The median tariff – the value in the middle of the count of all values in the set. Can be skewed by unbalanced reporting or data gathering.  Useful as a general indication of the country market and for inter market comparisons.
  • The average tariff – doesn’t represent an amount anyone actually pays, skewed by extremes in price. The best single number for comparing whole country markets when you want to understand the range of options for the consumer.

There is a difference in the relative country performance depending on which metric is used and the variation can be significant.

Here we show the price and country ranking for the metrics explained above for residential services. All prices expressed as international US$ (PPP rates).

entry level, average, median tariffs

The above chart shows the range from the entry level service through the median up to the average value of all the residential tariffs in the market. This highlights some of the issues we have outlined above.

The spreads in Japan, Germany, South Korea and Russia for example seem to indicate that it is relatively straightforward to get more bandwidth, at least in terms of cost. However perhaps that means that those on entry level tariffs are subsidising those on higher level tariffs. In India, Turkey, Brazil and the United States the differences in price levels of various speeds are much more pronounced, not least due to the limited supply of alternative technologies especially in rural areas.

Top 10 residential median tariffs

If we look at the most expensive markets in terms of median tariffs we also see some variation in entry level and average ones. Upgrading to higher level tariffs is still especially expensive in UAE, Qatar, Bolivia and Bahrain.

Get access to the full data

Access to the full version of the this report and our latest tariff database featuring more than 5,000 services from over 90 countries are available to subscribers of Point Topic’s Broadband Operators & Tariffs service. To find out more, please telephone +44 (0)20 3301 3303 or e-mail simona@point-topic.com.

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