Fixed broadband tariffs in Q2 2019

Broadband tariff benchmarks for residential and business broadband services

We have compared broadband tariffs across different technologies in Q2 2019, looking at price and speed variations in various parts of the world.

Global 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 Q2 2019, the average monthly charge for fibre connections increased by $3 PPP (3%) while the price of copper and cable remained almost unchanged compared to the previous quarter. The average monthly charge for residential broadband services went up by $3 PPP (3.4%) and stood at $91 in Q2 2019.

The average bandwidth provided to residential subscribers increased by nearly 5% compared to Q1 2019. The boost was impacted by the continued increase in bandwidth provided over fibre and cable networks. In Q2 2019, the average download speeds over fibre and cable increased by 5% and 6% respectively. At the same time, the average download speeds over copper dropped further from 11Mbps to 10Mbps.

In Q2 2019, the combined average cost per Mbps on broadband packages provided over the three technologies remained almost unchanged – it dropped slightly from $0.43 in Q1 2019 to $0.42 in Q2 2019. At the same time, the average cost per Mbps over copper increased by nearly 7% – not least due to the increasing costs of maintaining the legacy copper networks. Thus, in terms of cost per Mbps copper remains the most expensive technology.


Business broadband packages

In Q2 2019, the average monthly charge for standalone business broadband services increased by 8% compared to the previous quarter and stood at $209. The average monthly charge went up by 8% for cable and 10.4% for fibre while the cost of copper remained stable.

At the same time, the combined average bandwidth remained the same as in the previous quarter at 182Mbps. The average download speed on fibre connections has decreased by 1.5% compared to Q1 2019 while cable connections experienced a 9% boost. Copper maintained the same average download speeds compared to the previous quarter.

At the end of Q2 2019, the average combined cost per Mbps for business broadband packages increased by 6.5% and stood at $1.14. Copper connections experienced a 4% increase while fibre saw an even more significant growth of 12% in the average cost per Mbps. The average cost of cable connections remained unchanged in Q2 2019.

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 operators in the region continue to push fibre services. In Q2 2019, the average bandwidth in this region was 482Mbps. Western Europe and South and East Asia followed with 275Mbps and North America with 251Mbps as the rollouts of VDSL, G.fast, FTTP and Docsis 3.1 continued.

Middle East and Africa, where operators are focusing on mobile markets and technologies, had the lowest average fixed broadband download speed at 71Mbps. Due to the limited supply of fixed broadband, it was also the most expensive region. With still relatively low fixed broadband penetration, Latin America followed as the second most expensive market offering the second lowest average bandwidth at 100Mbps.

Region (residential broadband) Average Downstream Speed, Mbps (Q2 2019) Average Cost per Mbps (Q2 2019)
Asia-Pacific 481.96 $          0.14
Eastern Europe 162.80 $          0.41
Latin America 99.61 $          1.52
Middle East and Africa 71.32 $          2.22
North America 250.52 $          0.31
South and East Asia 275.02 $          0.32
Western Europe 274.51 $          0.23

Business broadband packages

The lowest priced business tariffs were offered in Western Europe and North America. While being the fourth most expensive market, Asia-Pacific offered the highest average download speeds at 339Mbps with an average cost per Mbps of bandwidth of $1.21. In comparison, in Western Europe and North America the average cost per Mbps stood at $0.42 and $0.67 respectively, with the average bandwidth being 297Mbps in the former and 222Mbps in the latter.

Region (business broadband) Average Downstream Speed, Mbps (Q2 2019) Average Cost per Mbps (Q2 2019)
Asia-Pacific 339.10  $          1.21
Eastern Europe 98.07  $          1.08
Latin America 82.04  $          4.31
Middle East and Africa 34.41  $          9.59
North America 221.87  $          0.67
South and East Asia 133.11  $          1.75
Western Europe 297.02  $          0.42

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.

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).

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, France, UK, South Korea and Russia for example seem to indicate that it is relatively straightforward to get more bandwidth, at least in terms of cost, even though this may indicate that consumers on entry level tariffs are subsidising those on higher level tariffs. In Brazil, India, Turkey, China and the United States the differences in price levels of various packages are much more pronounced, not least due to the variation of supply between urban and rural areas.

Looking at the most expensive markets in terms of median tariffs we also see some variation in the entry level and average ones. Upgrading to higher level tariffs is still especially expensive in UAE, Bahrain, Bolivia, Algeria, Oman, Mauritania and Sudan. This is symptomatic of the African and Middle Eastern countries where the competition is low and mobile broadband is the technology of choice for accessing the internet.

APPENDIX

Coverage and Methodology

The monthly rental prices have been analysed in terms of local currency and equivalent USD costs.

As of Q1 2007, a full set of tariff information is available for download as part of Point Topic’s Broadband Operators and Tariffs Service. The data set contains the most up-to-date tariff information including such details as monthly rental, connection speed, equipment cost and service features. In Q1 2007, Point Topic began providing end of quarter tariff updates from the database, which clients may use for their own historical analysis. These are now incorporated into our benchmark report and are published simultaneously.

Entries within tariff data sets which do not have both a downstream speed and a monthly rental listed have been excluded from this analysis.

The PPP rates used are published annually by the World Bank for a selection of countries and are readily available to the public free of charge. Those PPP rates are published at the beginning of each year are used throughout the year and hence any quarterly changes in PPP rates are not taken into account during the analysis. Some retrospective adjustments to PPP rates were made during the period 2000–2010. All PPP rates during this period were updated accordingly.

Price comparison issues

This analysis is intended as a general indicator of the trends in pricing in major broadband countries. There are several additional variables that complicate the process of making a direct comparison of broadband prices. These need to be taken into account when making a more in-depth analysis:

  • ISP charges: Some operators include ISP charges in their monthly rental, whereas others do not and charge an additional cost. This is evident in the case of Yahoo Japan, where a separate ISP charge is billed to the customer. In instances where this clearly occurs, Point Topic includes the charge in the monthly rental.
  • Bundling: With the continuous competition in service price, ISPs are focusing on bundling value-added services in order to increase revenue. Since Q1 2007, an integrated tariff database file containing bundled services information is available as part of the Broadband Operators and Tariffs service. This allows a comprehensive analysis of bundled services and pricing which we introduced here for the first time in Q1 2007.
  • Tax charges: Sales taxes (such as value-added tax) are also included in the residential monthly rental by most operators, although this is not the case in North America where telecommunications taxes are charged on top of the monthly rental. There would be a slight difference in the rankings if tax costs were included in the quoted monthly rentals of North American operators.
  • Time limits: Many operators worldwide have begun introducing broadband packages that restrict the time spent online without additional charges. For a monthly flat rate, customers can enjoy ‘free’ broadband access at particular times of the day/night, or for a certain number of hours per month. Any time spent beyond that limit is charged at an hourly rate.
  • Download limits: Some operators offer entry-level services with data volume limits. In most cases, these limits are generous enough so as not to affect light or medium users. Point Topic includes this type of service as a reasonable entry-level service since it does not involve adding a usage charge to the monthly cost for the typical user.

Get access to the full data

Access to the full version of 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 as well as Double Play and Triple Play services. To find out more, please telephone +44 (0)20 3301 3303 or e-mail simona@point-topic.com.

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