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Asia Pacific: the third global IP traffic region.

1

28 April 2004

Sturt Eastwood

Director, Europe

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• Asia Pacific IP traffic growth.

• Asia Pacific’s position in the global Internet space.

• Real drivers behind IP traffic growth in the Asia Pacific region.

• Asia Pacific: the centre of the global Internet?

Outline

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Will IP Follow Telephony?

(ITU World Telecommunication Indicators Database)

Asia-Pacific

22%

Europe41%

Americas35%

Africa/Arab States

2%

1991 TotalTelephone

Subscribers555 million

Asia-Pacific

29%Europe

36%

Americas33%

Africa/Arab States

2%

1996 Total Telephone

Subscribers877 million

Asia-Pacific

36%Europe

35%

Americas27%

Africa/Arab States

2%

2001 Total Telephone

Subscribers1’979 million

Total telephone subscribers = mobile + fixed line

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Top Level Regional Indicators

EMEA• Population - 1.6b• GDP per cap. - US$5,986• Internet Access (%) - 10.9%• Broadband (%) - 0.8%

EMEA• Population - 1.6b• GDP per cap. - US$5,986• Internet Access (%) - 10.9%• Broadband (%) - 0.8%

Asia Pacific• Population - 3.7b• GDP per cap. - US$2,343• Internet Access (%) - 5.9%• Broadband (%) - 0.7%

Asia Pacific• Population - 3.7b• GDP per cap. - US$2,343• Internet Access (%) - 5.9%• Broadband (%) - 0.7%

Americas• Population - 0.85b• GDP per cap. - US$15,050• Internet Access (%) - 24.3%• Broadband (%) - 2.9%

Americas• Population - 0.85b• GDP per cap. - US$15,050• Internet Access (%) - 24.3%• Broadband (%) - 2.9%

Source: ITU, Birth of Broadband, Sept, 2003

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International IP Backbone Capacity

62.1 Gbit/s 103.3 Gbit/s

386.2 Gbit/s

4.4 Gbit/s

Source: Global Internet Geography, 2004, PrimetricaSource: Global Internet Geography, 2004, Primetrica

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IP Backbone Bandwidth Growth Trends

Actual and Forecast IP Backbone Bandwidth

0

200

400

600

800

1,000

1,200

1,400

1,600

1998 1999 2000 2001 2002 2003 2004 2005 2006

IP B

ac

kb

on

e B

an

dw

idth

(G

bit

/s)

Trans-Atlantic Trans-Pacific Intra-Asia

Intra-Asia Bandwidth Starts to Exceed Trans-

Pacific Bandwidth

Intra-Asia Bandwidth Growth Rapidly Exceeds Growth in Trans-

Pacific Bandwidth Growth

Source: Telegeography, International Bandwidth 2004

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Routing Intra-Asia Traffic via the US

Now: estimated 30% of intra-Asia traffic via US

1998: 100% of intra-Asia traffic via US

70%

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Direct Europe-Asia Capacity

Sing to London RTD is 192msSing to London RTD is 192ms

Via the US RTD is 368msVia the US RTD is 368ms

Direct Europe to Asia Actual and Forecast IP Backbone Bandwidth

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

2001 2002 2003 2004 2005 2006 2007

EU

-As

ia IP

Ba

ck

bo

ne

Ba

nd

wid

th (

Mb

it/s

)

Source: Gartner IP Backbone Opportunities, 2003

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Broadband Penetration by Region

Share of Broadband Lines

Asia Pacific44%

EMEA32%

Americas24%

Asia Pacific

EMEA

Americas

Region Thousands of Lines (31/12/03)

Asia Pacific 44,109

EMEA 24,777

Americas 31,983

Source: Point Topic, 2004

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So Where is the Broadband Market Going?

Asia broadband rates are ten times fasterthan in North America and Europe.

Corning, 2003

Asia broadband rates are ten times fasterthan in North America and Europe.

Corning, 2003

Asia Pacific will continue to dominateglobal broadband uptake. By the end of 2004, the region will have 56.6m broadband households, topping North America 37.7m and Western Europe’s 28.7m

Broadband Worldwide, 2004

Asia Pacific will continue to dominateglobal broadband uptake. By the end of 2004, the region will have 56.6m broadband households, topping North America 37.7m and Western Europe’s 28.7m

Broadband Worldwide, 2004

Source: Point TopicTop ten broadband countries by lines added

Source: Point Topic

The number of Chinese Internet usersconnecting to the Internet over broadband connections rose by 173% during 2003.

CNNIC, 2004

The number of Chinese Internet usersconnecting to the Internet over broadband connections rose by 173% during 2003.

CNNIC, 2004

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Broadband Pricing and Download Speeds

Aust.$881.5M

Aust.$881.5M

China$242M

China$242M

HK$516M

HK$516M

India$36

0.06M

India$36

0.06M

Japan$3645M

Japan$3645M

Korea$358M

Korea$358M

Philipp.$500.3M

Philipp.$500.3M

Malay.$260.5M

Malay.$260.5M

Sing.$1232.5M

Sing.$1232.5M

Taiwan$363M

Taiwan$363M

$351.5M

$351.5M

$341.5M

$341.5M

UK$671M

UK$671M

Ger.$692M

Ger.$692M

France$481M

France$481M

REACH research – typical residential broadband packages, April, 2004

$453M

$453M

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REACH Global IP Backbone NetworkDuring the last year, direct Asia to

Europe IP backbone bandwidth hasincreased from 155 to over 700 Mbit/s

During the last year, direct Asia toEurope IP backbone bandwidth has

increased from 155 to over 700 Mbit/s

Over the past year, intra-AsiaIP network capacity has

Increased from 6.3 to 13.9 Gbit/s

Over the past year, intra-AsiaIP network capacity has

Increased from 6.3 to 13.9 Gbit/s

Trans-Pacific IP backbone Bandwidth has increased from

9.1 to 10.7 Gbit/s in 12mths

Trans-Pacific IP backbone Bandwidth has increased from

9.1 to 10.7 Gbit/s in 12mths

Chicago

London

ToHongKong

Equinix

NYIIX

LINX

Newark

Palo Alto

Miami

Dallas

New York

Washington DC

NAP of the Americas

Equinix

Equinix

Los Angeles

San Jose

Equinix

Tokyo

Perth

SydneyAuckland

Jakarta

JPNAP

JPIX

NSPIXP2

UAE

New Delhi

Guangzhou

ShanghaiBeijing

Manila

Singapore

Kuala Lumpur

Mumbai

Seoul

To London

Bangkok

HKIX

MacauPAIX

NIX

SOX

IIX

GIX

MIX

EquinixTo

London

To Mumbai

To London

To Singapore

Chennai

KTIX

KINX

DIX

NIXI

REACH actual customer traffic has increased 2.3 times over the last 12 months.

REACH actual customer traffic has increased 2.3 times over the last 12 months.

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The Global Internet

USAEurope

AP

1998 2004

USA

Asia

Europe

Asia

USA Europe

200?

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Thank you

REACH is an Asian-focused international carrier providing global

connectivity services to carriers and service providers

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