Many factors influence how fast broadband spreads across a country. Income and investment levels, regulation, competition and urbanisation all play a role. But which of these is most important? New research from the International Telecommunications Union (ITU) suggests that the presence of a national broadband plan is the biggest success factor, followed by competitive markets.
The ITU conducted a statistical analysis on 165 countries for the ten years to 2011, to test for correlation between broadband penetration and six variables: the presence of a national plan; GDP per capita; urbanisation; the presence of a regulator; levels of private sector investment; and the level of market competition.
The analysis shows that of the six variables, the adoption of national broadband plans is correlated most strongly with increases in fixed broadband penetration. Countries adopting some form of a plan—anything from a basic policy framework to a detailed strategy—saw an average increase in fixed broadband penetration of 2.5%, which is statistically highly significant. A movement away from monopoly and towards a competitive market was associated with an increase of 1.4%, also statistically significant. The results were adjusted for differences in national income or private investment.
The effect of competition on mobile broadband penetration was even higher, at 27%. The presence of a national strategy was associated with an average increase of 7.4% in mobile broadband penetration.
This is the first statistical evidence demonstrating the positive effects of national plans on broadband adoption. The research also shows that a national strategy, no matter how basic, can overcome structural factors such as income levels. It also suggests to regulators that maintaining a telecoms monopoly is a sure-fire way to hinder the march of broadband.
The EIU's Telecoms Briefing offers forecasts and analysis for the world’s major telecoms markets, by combining reliable historical data with the expertise of our country analysts to project trends for the next five years.