Smart Home Services Promise New Revenue

January 11, 2013

Developed markets in Asia-Pacific rank second globally in fixed broadband household penetration and will leap to the top spot, surpassing North America, in 2017. On top of that, APAC as a whole will emerge as the global leader in LTE deployment by 2014. The high penetration of fiber-optic networks places telcos in the region in a unique position to create new revenue streams amidst declining income from traditional telecommunication services and to strengthen their subscription base.

Exhibit: Forecast of Fixed Broadband Household Penetration, APAC, 2012-2017

Source: Pyramid Research

Operators in these markets are evolving from simple bundling to adding more sophisticated services on top of their high-speed access services.

Exhibit: Strategic Map of Convergence Evolution, APAC

Source: Pyramid Research

Most telcos around the world are already offering price competitive bundles, oftentimes to poach subscribers from rival operators. However, such a strategy can result in a war of attrition and risk retaliation with even heavier discounts by competitors. Cloud storage and multiscreen access services are now becoming common value-added services. One step beyond discounted bundles is to add more value to multiplay offers, such as pushing entertainment on the go across multiple platforms, synchronizing and accessing photo albums on smart TVs, incorporating a karaoke function to digital set-top boxes, concierge services for leisure and travelling, electronic government on the fixed-line front, and family-oriented wireless tariffs on the mobile front.

However, to completely own the household with existing broadband subscriptions, services can be offered that we refer to as smart solutions. For instance, PCCW, the forerunner in fixed-line communication in Hong Kong, offers its broadband subscribers a central hub, the Eye Tablet, to control the PCCW-equipped smart house. PCCW’s smart home enables adjustments of lighting, temperature, home theatre and surveillance, which can all be manipulated through the Eye Tablet. Healthcare services are also offered whereby devices such as pedometers and heart meters send data to a central application that integrates with databases accessible to doctors and healthcare professionals. In Japan, NTT has created a joint venture that also plans to offer similar services.

— Hansang He, Analyst

Related resources:

Pyramid Research APAC Fixed Communications Forecast
Forecast published quarterly
The Fixed Communications Forecast quantifies fixed voice, Internet and IPTV adoption and service revenues trends, at the residential, corporate and total market level. It tracks demand and projects future growth for 61 markets worldwide and is available at the country, regional and global levels.

Pyramid Research APAC Fixed Operator Market Share Forecast
Forecast published quarterly
The Fixed Operator Market Share Forecast is a companion product to our industry leading Fixed Communications Forecast. It tracks key market-share indicators for up to three operators per country. It is available for over 59 countries worldwide, for Europe, North America, Latin America and Asia Pacific at the regional level and at it is available at the global levels as well.