Demand for broadband and data-based services is growing in the South Pacific, improving both economic and social conditions in the region, writes Paul Budde.
AUSTRALIA HAS a special relationship with our South Pacific neighbours and we have a responsibility to collaborate with them and assist them, especially in the fields of information technology and telecommunications. Therefore, I would like to share this information with you that BuddeComm has prepared for this region.
It is good to see that the demand for data-based services in the Pacific region is also growing, aligning with similar trends around the world. In particular, the demand for mobile broadband is increasing due to mobile services being the primary and most widespread source for internet access across the region.
Mobile technology will play a pivotal role in the digital transformation of the Pacific Islands by giving the population access to services such as e-government, health and education. Mobile technology will also act as a catalyst for innovation and economic growth.
The three largest countries in terms of population include Papua New Guinea, Fiji and the Solomon Islands. While Papua New Guinea has the largest population by far, it provides opportunities for significant growth considering its mobile penetration is still low, at just over 30%. However, there are challenges to be overcome before significant growth can occur.
Internet penetration in the region is among the lowest in the world. However, an increase in international connectivity will improve penetration, coupled with an increase in 4G connections.
While there are many local operators, there are also regional players including Digicel, which has operated in the Pacific for some years. Recently, the Fiji-based Amalgamated Telecom Holdings (ATH) has expanded regionally, completing a few acquisitions.
International organisations such as United Nations, the World Bank and the Asian Development Bank have taken a special interest in seeing the general living conditions, as well as communication services, improve in the Pacific region. It is well recognised that access to broadband services can vastly improve the economic and social conditions in these emerging markets, many of which are prone to natural disasters and rising sea levels.
This week, I cover the three largest countries; next week, some of the smaller islands will be discussed.
Papua New Guinea
Fixed-line teledensity in Papua New Guinea has seen little change over the past two decades. Progress in the country’s telecom sector has come primarily from mobile networks, where accessibility has expanded considerably in recent years, with population coverage increasing from less than 3% in 2006 to more than 90% by early 2021. The two MNOs operate networks offering services based on GSM, 3G and LTE, depending on location. GSM is prevalent in many rural and remote areas, while 3G and LTE are centred more on urban areas.
The Kacific 1 satellite, launched in December 2019, has greatly improved the reach of telecom services in PNG (as well as in the Solomon Islands).
Network deployment costs are high, partly due to the relatively low subscriber base, the impervious terrain and the high proportion of the population living in rural areas. As a result, fixed telecom infrastructure is almost non-existent outside urban centres, leaving most of the population un-serviced. PNG is the Pacific region’s largest poorly developed telecom market, with only around 22% of its nearly 8.8 million people connected to the internet.
The existing submarine cable infrastructure is no longer adequate to serve the country’s needs. Low international capacity has meant that internet services are expensive and slow. Internet access has improved, however, with the Coral Sea Cable System which came online in 2019. The cable links PNG to the Solomon Islands and Australia, see below.
Telecommunication infrastructure in the Solomon Islands requires significant investment due to the geographical make-up of the islands. Although various international organisations such as the World Bank and the Asian Development Bank have taken a special interest in having communication services improved in both the Solomon Islands and the Pacific region in general, internet and broadband penetration remain low. The provision of broadband infrastructure, particularly to rural areas, is also hindered by land disputes.
Internet services have, however, improved with the build-out of the Coral Sea Cable System linking Papua New Guinea to the Solomon Islands, also with a connecting cable to a landing station at Sydney. The Australian Government provided most of the funding for the Coral Sea Cable System, with contributions and support from the Solomon Islands and Papua New Guinea Governments.
In recent years, the country has stabilised both politically and economically and this, along with improvements to mobile infrastructure, has led to a rise in mobile penetration and the slow uptake of broadband services. While the first LTE services were launched in late 2017 in the capital Honiara, the main platform for mobile voice and data services remains 3G while in outlying areas, GSM is still an important technology for the provision of services.
Fiji has a relatively sophisticated communications infrastructure with the highest mobile and internet penetration in the Pacific Islands. It is the leading market to watch in terms of both LTE and 5G development in this region.
The Fijian mobile operators, including Digicel Fiji and Vodafone Fiji, continue to invest in LTE and LTE-A technologies and these networks now account for the largest share of mobile connections. Concentrating on the more highly populated areas, the operators are preparing for the next growth area of mobile data. The operators also have 5G in mind and are preparing the networks to be 5G ready.
Fiji presents a challenging geographic environment for infrastructure developments generally, due to its population being spread across more than 100 islands. However, most Fijians live on the two main islands of Viti Levu and Vanua Levu.
In July 2018, the two islands were linked by the Savusavu submarine cable system, which provides a more secure link between the two islands in times of emergency weather events such as the regular tropical cyclones which often cause much destruction to this area. These natural disasters often destroy essential infrastructure including electricity and telecoms equipment.
Next week, an overview of some of the smaller islands.
Paul Budde is an Independent Australia columnist and managing director of Paul Budde Consulting, an independent telecommunications research and consultancy organisation. You can follow Paul on Twitter @PaulBudde.
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