Selling cells for broadband
Alcatel outlines opportunities for cellular broadband while Catherine Yong furiously takes notes.

A few months ago, because of certain events at the time, I consciously started to form the theory that broadband coverage is spotty because there just wasn’t enough demand for it. (Lately in the blogosphere a hardwarebased reason, was also suggested by Jeff Ooi at www.jeffooi.com). If you are a constant user of the Internet and use it daily for tasks like downloading music/movies, gaming, communications or even just online transactions, low broadband demand may seem like a ridiculous notion. I know I thought so. Or at least, I used to.

And I never thought that research from a French company would be the one to shed some light on local broadband demand and what influences it. At least from the cellular broadband point of view, for Alcatel to be in the business that they are in, they have a pretty good vantage point of the mobile broadband situation.

Alcatel’s Vice President for Marketing Programs, Valerie Faudon’s presentation started off with the figure 6 billion. This is the global population right now, and of this only 2.7 billion are mobile subscribers. When it comes to broadband users however, there’s a total of 470 million. Alcatel’s proposition is that anyone with a mobile phone and mobile subscription (2.7 billion) is already a potential (wireless) broadband user.

There was also a survey involved and with a sample of 400 Malaysians distributed over Perak, Negeri Sembilan and Melaka, Alcatel interviewed internet café users to try to ascertain local demand – Internet café users are more likely to see it makes sense to buy a broadband package sooner or later. The quantitative survey which was done in August this year, also included regional cities in seven other countries like Russia, Brazil, Egypt, Kenya, India and China.

Now digest this. On average, Malaysians spend USD16 on internet café usage and USD24 on mobile subscription, in a month. That’s already well over the industry average of USD11 and USD20 respectively.

In Alcatel’s experience high-growth markets have heterogenous user segments and Malaysia is the only country with the distinction of having user base in all three levels of usage – entry level (voice and data penetration), Internet user (mass market broadband penetration) and advanced users (user-centric broadband experience like IPTV, triple play and more).