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China may account for half of the world´s fiber users by 2016

By Max Burkhalter
July 26, 2011
According to a report from industry analyst Ovum, the fiber broadband market will be dominated by China by the year 2016. Most of this growth can be attributed to the sheer size of the Chinese population.

Ovum principal analyst and co-author of the report Julie Kunstler says that, “China is the biggest consumer of FTTx equipment right now and that is set to continue. A key driver of the enormous forecasted growth is the bandwidth and subscriber targets set by the Chinese government and service providers. In addition, the government is providing support for deployments in the form of credit and partnerships. Meanwhile, the significant greenfield construction projects that are under way in the country make the installation of FTTx networks easier.”

China’s fiber to the home penetration is currently very low at just four percent, but this number is still very close to Japan’s year-end 2010 figure at nearly 20 million. By the end of the first quarter of 2011 this number had already grown to over 22 million, according to Informa World Broadband Information Service statistics.

China’s leading native vendor is growing rapidly but continues to face opposition around the world. Politics seems to be playing a large role in the Chinese fiber business. Earlier this year, the company’s U.S. executive Ken Hu wrote an open letter denying that the company had any links to the Chinese military, while more recently it has faced a ban in Taiwan, as it got caught up in the dispute over the island’s sovereignty between its government and its nominal Chinese rulers.

The Chinese migration to fiber comes at a good time for the region. Another recent Ovum study regarding IPv6 found that the Asia/Pacific region currently leads the world in IPv4 to IPv6 transition. There are a variety of reasons for this rapid growth in the region.

The Asia Pacific is the top growth region in the world, manufactures many electronic devices and many companies see this as their key expanding region. Also, many multinational enterprises are growing their businesses in the region, which will influence the faster pace of IPv6 adoption globally. Finally, a sense of urgency in the Asia Pacific region has been prompted by the announcement by the Asia Pacific Network Information Centre that the free pool of IPv4 addresses has been effectively exhausted.


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