Omdia: Big increase in Gig internet subscribers in 2022; Top 25 countries ranked by Cable

Global gigabit internet subscriptions are expected to increase to 50 million in 2022, more than doubling from 24 million at the end of 2020, according to a new report from market research firm Omdia (owned by Informa).

The Omdia report states that accelerated fiber deployments are helping to drive an increase in gigabit connectivity.

“Demand for reliable broadband is set to drive growth in gigabit services, with fiber playing a key role,” said Peter Boyland, principal analyst, broadband at Omdia.

“There were fewer than 620 million fiber subscriptions globally at the end of 2020, but we expect these to grow to 719 million in 2022, or 62% of total subscriptions.”  The majority of fiber internet subscribers are expected to be in China.

However, Omdia warns that service providers must “carefully consider market demand” for their gigabit strategies and make targeted investments in fiber.

“Service providers need to carefully plan and execute gigabit network rollout, analyzing a number of factors, including infrastructure challenges, market competition, and expected demand,” writes Omdia. “But this does not stop with network rollout – operators need to continually monitor potential competitors and constantly innovate, refresh, and build service offerings so they stay ahead of rivals.”

The analysts also point out the opportunity for vendors in the market who can help service providers build “future proof” networks. “Vendors can offer long-term solutions such as monitoring and automation tools to extend the operator/vendor relationship beyond network rollouts,” the report recommends.

Of course,  what matters most to consumers is reliable service. According to Omdia’s Digital Consumer Insights survey, 36% of respondents said they were more reliant on broadband services during COVID-19, and 55% of respondents said reliability ranked top among the most important home broadband features.

All of this gigabit and fiber growth will impact broadband speeds for years to come. According to Omdia:

“In 2020, just 2% of broadband subscriptions were more than 1Gbps, but this is expected to double to 4% in 2022.”

–>See table below for the 25 countries with the fastest AVERAGE internet speeds, ranked by Cable.  Note that none of them is close to 1Gbps.

The report says that subscribers with access to 500 Mbit/s-1 Gbit/s will increase from 15% in 2020 to 21% in 202, with 17% of broadband subscriptions projected to reach speeds over 1 Gbit/s by 2026.

While high-bandwidth entertainment like augmented and virtual reality (AR/VR) and gaming were thought to be the main drivers for ever-faster home broadband speeds in pre-pandemic times, Omdia’s report doesn’t think they are significantly important for gigabit Internet growth, referring to them just once as “other drivers.”

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Internet comparison site Cable has ranked the countries with the fastest broadband internet in the world based on over 1.1 billion speed tests across 224 countries and territories.

“The acceleration of the fastest countries in the world has finally plateaued this year as they reach FTTP pure fibre saturation. Increases in speed among the elite performers, then, can be attributed in greater part to uptake in many cases than to network upgrades. Meanwhile, though the countries occupying the bottom end of the table still suffer from extremely poor speeds, 2021’s figures do indicate that the situation is improving,”  said Dan Howdle of Cable.

Here are the 25 countries with the fastest download speeds:

1 Jersey JE WESTERN EUROPE 274.27
2 Liechtenstein LI WESTERN EUROPE 211.26
3 Iceland IS WESTERN EUROPE 191.83
4 Andorra AD WESTERN EUROPE 164.66
5 Gibraltar GI WESTERN EUROPE 151.34
6 Monaco MC WESTERN EUROPE 144.29
7 Macau MO ASIA (EX. NEAR EAST) 128.56
8 Luxembourg LU WESTERN EUROPE 107.94
9 Netherlands NL WESTERN EUROPE 107.30
10 Hungary HU EASTERN EUROPE 104.07
11 Singapore SG ASIA (EX. NEAR EAST) 97.61
12 Bermuda BM NORTHERN AMERICA 96.54
13 Japan JP ASIA (EX. NEAR EAST) 96.36
14 United States US NORTHERN AMERICA 92.42
15 Hong Kong HK ASIA (EX. NEAR EAST) 91.04
16 Spain ES WESTERN EUROPE 89.59
17 Sweden SE WESTERN EUROPE 88.98
18 Norway NO WESTERN EUROPE 88.67
19 France FR WESTERN EUROPE 85.96
20 New Zealand NZ OCEANIA 85.95
21 Malta MT WESTERN EUROPE 85.20
22 Estonia EE BALTICS 84.72
23 Aland Islands AX WESTERN EUROPE 81.31
24 Canada CA NORTHERN AMERICA 79.96
25 Belgium BE WESTERN EUROPE 78.46

It is the fourth year of the assessment and the latest ranking uses data collected in the 12 months up to 30th June 2021 to evaluate internet speed by country.

 

References:

https://www.lightreading.com/optical-ip/fttx/gigabit-subscriptions-set-for-big-increase-next-year—omdia/a/d-id/774291

Ranked: countries with the fastest internet in the world

https://www.cable.co.uk/broadband/speed/worldwide-speed-league/

 

Dell’Oro: PON ONT spending +15% Year over Year

According to a newly published report by Dell’Oro Group, total global revenue for the Broadband Access equipment market increased to $3.9 B in 3Q 2021, up 7% year-over-year (Y/Y). Growth came from spending on both PON infrastructure and fixed wireless CPE.  Please see chart below.

“5G fixed wireless deployments joined fiber as the primary drivers for spending this quarter,” noted Jeff Heynen, Vice President, Broadband Access and Home Networking at Dell’Oro Group. “Despite supply chain constraints and increased costs, operators continue to focus on expanding broadband connectivity,” explained Heynen.

Additional highlights from the 3Q 2021 Broadband Access and Home Networking quarterly report:

  • Total cable access concentrator revenue decreased 27 percent Y/Y to $257 M. There was a clear mix shift this quarter to remote PHY and remote MACPHY devices, both of which saw Y/Y revenue increases.
  • Total PON ONT unit shipments reached 32 M units, marking the fourth quarter in row-unit shipments have exceeded 30 M globally.
  • Component shortages are clearly impacting cable CPE and home networking device sales, with unit shipments down markedly Y/Y.

About the Report:

The Dell’Oro Group Broadband Access and Home Networking Quarterly Report provides a complete overview of the Broadband Access market with tables covering manufacturers’ revenue, average selling prices, and port/unit shipments for Cable, DSL, and PON equipment. Covered equipment includes Converged Cable Access Platforms (CCAP) and Distributed Access Architectures (DAA); Digital Subscriber Line Access Multiplexers ([DSLAMs] by technology ADSL/ADSL2+, G.SHDSL, VDSL, VDSL Profile 35b, and G.FAST); PON Optical Line Terminals (OLTs), Cable, DSL, and PON CPE (Customer Premises Equipment); and SOHO WLAN Equipment, including Mesh Routers. For more information about the report, please contact [email protected].

Separately, Dell’Oro reports that the worldwide Campus Switch market revenue reached a record level in 3Q 2021. Growth was mostly propelled by 1 Gbps, which reached a record level in shipments during the quarter, while  Ethernet NBase-T ports were down Y/Y.

“We have been predicting the demand in the market to remain strong, but what surprised us is the level of shipments and revenues that vendors were able to achieve during the quarter, despite ongoing supply challenges,” said Sameh Boujelbene, Senior Director at Dell’Oro Group. “It appears, however, that these supply challenges are impacting the newer technologies more than the older ones, due to a less diversified ecosystem, and in some cases, a less mature supply chain,” added Boujelbene.

Additional highlights from the 3Q 2021 Ethernet Switch – Campus Report:

  • Extreme, HPE, and Juniper each gained more than one point of revenue share in Europe, Middle East and Africa (EMEA)
  • H3C outperformed the market and captured the revenue leading position in China
  • Power-over-Ethernet (PoE) ports up strong double-digits and comprised 30 percent of the total ports

About the Report

The Dell’Oro Group Ethernet Switch – Campus Quarterly Report offers a detailed view of Ethernet switches built and optimized for deployment outside the data center, to connect users and things to the Local Area Networks. The report contains in-depth market and vendor-level information on manufacturers’ revenue, ports shipped and average selling prices for both Modular and Fixed, and Fixed Managed and Unmanaged Ethernet Switches (100 Mbps, 1, 2.5, 5, 10, 25, 40, 50, 100 Gbps), Power-over-Ethernet, plus regional breakouts as well as split by customer size (Enterprise vs. SMB) and vertical segments. To purchase these reports, please contact us by email at [email protected].

About Dell’Oro Group

Dell’Oro Group is a market research firm that specializes in strategic competitive analysis in the telecommunications, networks, and data center IT markets.  Our firm provides in-depth quantitative data and qualitative analysis to facilitate critical, fact-based business decisions.  For more information, contact Dell’Oro Group at +1.650.622.9400 or visit www.delloro.com.

References:

Strong Demand for Fiber and Fixed Wireless CPE Fuels 7 Percent Y/Y Broadband Equipment Growth, According to Dell’Oro Group

3Q 2021 Campus Switch Sales Catapulted to an All-time High, Despite Supply Challenges, According to Dell’Oro Group

 

Leichtman Research Group: U.S. broadband growth returns to pre-pandemic levels in Q3-2021

Leichtman Research Group, Inc. (LRG) found that the largest cable and wireline phone providers in the U.S. – representing about 96% of the market – acquired about 630,000 net additional broadband Internet subscribers in 3Q 2021, compared to a pro forma gain of about 1,525,000 subscribers in 3Q 2020, about 615,000 in 3Q 2019, and about 600,000 in 3Q 2018.

These top broadband providers now account for about 107.9 million subscribers, with top cable companies having about 75.2 million broadband subscribers, and top wireline phone companies having about 32.7 million subscribers.

Findings for the 3rd /quarter include:

  • Overall, broadband additions in 3Q 2021 were 41% of those in 3Q 2020
  • The top cable companies added about 590,000 subscribers in 3Q 2021 – 45% of the net additions for the top cable companies in 3Q 2020
  • The top wireline phone companies added about 40,000 total broadband subscribers in 3Q 2021 – compared to about 200,000 net adds in 3Q 2020.  Telcos had about 475,000 net adds via fiber in 3Q 2021, and about 435,000 non-fiber net losses

“Broadband additions returned to pre-pandemic levels in the third quarter of 2021,” said Bruce Leichtman, president and principal analyst for Leichtman Research Group, Inc. “The top broadband providers added significantly fewer subscribers than in last year’s third quarter, but had a similar number of net adds as in 3Q 2019 and 3Q 2018.”

Broadband Providers/ Subscribers at end of 3Q 2021// Net Adds in 3Q 2021/
Cable Companies
Comcast 31,688,000 300,000
Charter 29,899,000 265,000
Cox* 5,510,000 25,000
Altice 4,388,100 (13,200)
Mediacom 1,466,000 (2,000)
Cable One 1,030,000 13,000
Atlantic Broadband^ 717,000 3,000
WOW (WideOpenWest)^ 509,500 1,600
Total Top Cable 75,207,600 592,400
Wireline Phone Companies
AT&T 15,510,000 29,000
Verizon^^ 7,337,000 74,000
CenturyLink/Lumen 4,589,000 (77,000)
Frontier 2,789,000 (9,000)
Windstream 1,147,000 15,200
TDS 522,800 9,200
Cincinnati Bell* 439,000 1,200
Consolidated 390,661 (2,819)
Total Top Telco    32,724,461 39,781

References:

About 630,000 Added Broadband in 3Q 2021

 

Cable broadband subscriber growth slows while FTTx and FWA gain ground

Cable network operators (cablecos or MSOs) are losing ground to FTTP/FTTx (fiber to the premises/ cabinet/ home) and FWA (fixed wireless access).

  • Bloomberg reports that cable broadband growth is sputtering and no one knows why.
  • GlobalData agrees, but forecasts a solid increase in U.S. fixed-broadband lines.

Broadband internet subscriber growth at Comcast Corp. and Charter Communications Inc has decreased, raising concerns about an end to what has been a huge growth business, with explanations ranging from a slowdown in consumer spending to competition from phone giants.

Charter on Friday reported 25% fewer new broadband subscribers than analysts estimated and said the overall number of new customers would fall back to 2018 levels.  Charter had 1.27 million new broadband customers in 2018 compared with 2.2 million last year. Analysts predict it will add 1.4 million subscribers this year, according to estimates compiled by Bloomberg.

Comcast, which had earlier cut its subscriber forecast, reported 300,000 new internet customers Thursday, less than half the number added a year ago.

Analysts were expecting some slowdown in demand coming off 2020, a year when broadband sign-ups spiked as the pandemic shifted people to working and schooling from home. Still, with Charter echoing Comcast’s gloomy picture from Thursday, suddenly there’s a chill on the cable broadband front, which became the most prized segment of the business as consumers cut traditional TV service.

Charter’s shortfall raises “questions about whether this is the beginning of the end of the cable broadband story,” said Geetha Ranganathan, an industry analyst at Bloomberg Intelligence.

GlobalData forecasts that cable’s share of total U.S. fixed broadband subscriptions will decline to 67.1% by the end of 2026, from 68% in 2021, as other technologies such as fiber and fixed wireless expand their presence. Total U.S. fixed-broadband lines, including fiber, fixed wireless and cable, will increase from 103.1 million in 2021 to 112.3 million by 2026 says the market research firm.

No one has been able to identify the exact reason why the wind has gone out of the sails for big cable. Both Charter and Comcast blamed a slower new home market for some of the slack in demand, leaving the companies to try and squeeze more business out of their saturated markets.  Other factors could include a drop off in lower-paying customers as government assisted broadband funds dry up.

Even as Comcast and Charter deploy new faster network technology to attract more lucrative customers, cable’s share of the market is starting to shrink, according to Tammy Parker, a senior analyst with GlobalData.

Total U.S. broadband lines will increase to 112.3 million by the end of 2026 from 103.1 million in 2021, including new wireless internet customers, the market research firm predicts.

The number of U.S. fiber lines will grow at a CAGR of 10.8% to reach 28.2 million lines by the end of 2026. This growth will be due to rising demand for high-speed internet services in the nation, and efforts by the government and operators to expand FTTx networks.

References:

https://www.bloomberg.com/news/articles/2021-10-30/cable-broadband-growth-is-sputtering-and-no-one-s-sure-why

https://www.telecomlead.com/broadband/number-of-us-fiber-lines-to-reach-28-2-mn-by-2026-102290

https://www.fiercetelecom.com/telecom/multi-gig-competition-to-heat-up-as-fiber-takes-center-stage-globaldata