Broadband unaffordable in emerging markets says Ovum
Broadband in emerging markets is an “unaffordable luxury” according to report
Consumers living in emerging markets are paying up to three times more for broadband than their mature market counterparts, according to a report from UK-based research firm, Ovum.
The report, which focused on 15 emerging markets, highlighted Nigeria as a particularly extreme example. Nigeria's broadband tariffs were among the most expensive of those sampled by Ovum, with the annual cost of some services reaching more than $2,000 a year, despite the country having a low GDP per capita at $1,170.
South Africa had the highest broadband prices of all the countries sampled. The annual cost of some services was found to be more than $5,000, against a GDP of $5,820 a year.
Angel Dobardziev, practice leader, Ovum, said that the low average wages in many emerging markets, combined with the high costs, made broadband an "unaffordable luxury" for most people in these countries.
"The striking difference in broadband prices in mature and emerging markets means there is a huge divide in terms of uptake of services," she said.
"The key to making broadband more affordable for emerging markets will be an increase in supply and competition, which is currently modest in most markets and non-existent outside the key urban areas.
"However, many markets will require concerted regulatory and policy efforts to increase competition and supply and bring affordability within reach of the mass consumer market. As yet it is unclear how quickly this will happen."