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Affordability of Internet access in the Pacific 2015

Fixed broadband affordability has improved in all our sample countries, but even a low-level use of 2GB per month requires more than 100% of average monthly income in both Papua New Guinea and the Solomon Islands.

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Our last update of Internet access affordability in the Pacific Islands was three years ago, so what has changed, and is affordability improving significantly?

Well, technological progress in Internet access is slowly but surely being felt in the Pacific. ADSL and/or fixed wireless broadband is available in all the countries we have included in our analysis – which now includes newcomer Nauru – and we have even noticed fibre being advertised in a few select cases. The die-off of dial-up services that was noted back in 2012 is continuing, to the point that we have not included this in our analysis, and have instead replaced it with a new category – mobile broadband, that is now available for laptops in some countries (as shown in Exhibit 1). Still more countries have mobile Internet available for handsets, however these services are not considered here, but will be included in our upcoming analysis of mobile services in the Pacific Islands.

Fixed broadband affordability has improved in all our sample countries, but even a low-level use of 2GB per month requires more than 100% of average monthly income in both Papua New Guinea and the Solomon Islands. At the other end of the scale, in five countries the same usage level takes less than 10% of monthly income, with star performer the Cook Islands taking just 1.5%.

Affordability of the new mobile broadband services varies widely, with a very low usage of 500MB per month being equivalent to 2.7% of average monthly income in Fiji up to 35% of monthly income in Kiribati.

Exhibit 1: Internet availability in various Pacific Island countries, October 2015 [Source: operator websites]

Country Dial-up Fixed broadband (wired / wireless) Mobile broadband (USB stick / datacard)
Cook Islands no yes no
Federated States of Micronesia (FSM) yes yes no
Fiji no yes yes
Kiribati no yes yes
Nauru no yes no
Niue no yes no
Papua New Guinea (PNG) yes yes yes
Republic of the Marshall Islands (RMI) yes yes no
Samoa no yes yes
Solomon Islands no yes no
Tonga yes yes no
Vanuatu no yes yes

Analysis – fixed broadband

The affordability of fixed broadband services has been improving in the Pacific for both low and high-levels of usage (Exhibit 2 and Exhibit 3 respectively). However, in the two least affordable countries, even the significant improvements shown still do not bring the monthly cost of fixed broadband services down below 100% of annual income. Five of the 12 countries analysed now require less than 10% of average annual income for a low-level of fixed broadband usage, including newcomer Nauru. For a high-level use of fixed broadband only three countries break the 10% barrier.

Exhibit 2: Monthly spend on fixed broadband Internet access as a proportion of average monthly income for a low-level use of 2GB per month [Source: Network Strategies]
Monthly spend on fixed broadband Internet access as a % of average monthly income for low-level use [Source: Network Strategies]

Exhibit 3: Monthly spend on fixed broadband Internet access as a proportion of average monthly income for a high-level use of 6GB per month [Source: Network Strategies]
Monthly spend on fixed broadband Internet access as a % of average monthly income for high-level use [Source: Network Strategies]

Analysis – mobile broadband

Mobile broadband access for a laptop using a USB stick or dongle is available in five of our sample countries. For two of these countries – Fiji and Samoa – both a very low use of 500MB per month and a low use of 1GB per month required less than 10% of average monthly income. At the other end of the scale, mobile broadband in Kiribati required 35% of average monthly income for a very low level of use and 70% for a low level of use.

Exhibit 4: Monthly spend on mobile broadband Internet access as a proportion of average monthly income [Source: Network Strategies]
Monthly spend on mobile broadband as % of average monthly income [Source: Network Strategies

Notes for analysis of monthly spend:

  • All plans for 2015 were current as at October 2015. Plans for 2012 were current at November 2012.
  • Affordability was calculated for each country using the plan from any operator that resulted in the lowest monthly spend.
  • GDP per capita divided by 12 was used as a proxy for average annual income for calculating affordability.
  • GDP per capita data were sourced from the World Bank for 2013.
  • OECD Internet baskets of usage for fixed broadband use were sourced from the report: Revision of the methodology for constructing telecommunications price baskets, 18 March 2010.
  • OECD Internet baskets of usage for mobile broadband use were sourced from the report: Methodology for constructing wireless broadband price baskets, September 2012.

November 2015


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