Gigabit broadband, who will buy it?

From the second half of last year to this year, the three major operators have successively launched pilot access services for gigabit broadband, and they have recently been promoting gigabit broadband more frequently. Gigabit broadband can provide ultra-fast broadband access capabilities, but the high price and hardware upgrades have also discouraged most consumers. At this stage, only certain professions and some high-income groups will consider buying it. According to forecasts, with the increase in network speed requirements for future high-tech applications and the trend of broadband prices becoming more affordable, it will take several years for gigabit broadband to be popularized in China.

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Operators are making all-out efforts

On April 9, China Mobile Beijing held a lighting ceremony for the Gigabit Demonstration Community of the "Gigabit Beijing Intelligent Optical Network", where residents of the Gigabit Demonstration Community can be the first to experience Gigabit broadband. After the Gigabit Demonstration Community in Beijing is completed, other communities will also be connected to Gigabit broadband one after another.

In addition to China Mobile, China Unicom has also recently launched a Gigabit broadband pilot. At the end of last month, China Unicom announced that it would launch a Gigabit broadband pilot in 15 cities including Beijing, Shanghai, and Tianjin, and would also formulate the next batch of promotion plans based on the pilot results. Jiang Zhengxin, the company's deputy general manager, said that China Unicom has now completed the fiber-optic transformation of broadband in most provinces, cities and districts across the country, and 88% of the coverage areas can provide 100M access capabilities, and some areas can provide Gigabit access capabilities. After the broadband speed increase, users' Internet experience has been significantly improved, and fiber-to-the-home covers about 240 million households.

China Telecom, the largest fixed-line broadband operator in China, launched gigabit broadband access services in some provinces and cities as early as last year. On October 21 last year, China Telecom Shanghai Company officially launched the gigabit broadband scale development plan, planning to complete gigabit broadband access in 269 communities by the end of 2016 and achieve gigabit broadband coverage throughout the city in 2018; on October 28 last year, China Telecom Hefei Branch and Wuhu Branch also launched the gigabit broadband planning for household customers. It is expected that in 2017, all China Telecom broadband customers in Anhui towns and above will gradually enjoy ultra-high-speed broadband with a bandwidth of more than 1,000M. In addition, China Telecom has also launched pilot construction of gigabit broadband in Fujian, Henan, Tangshan and other provinces and cities.

According to Beijing Mobile, Gigabit broadband can provide families with ultra-fast broadband access capabilities, with a downlink bandwidth of up to 1000M (1G) of ultra-high-speed broadband network. Gigabit broadband will greatly improve data transmission efficiency and greatly shorten data transmission time. In theory, it only takes 65 seconds to download an 8GB Blu-ray video file with 1000M broadband, while it takes 10 minutes with 100M broadband.

"Broadband speed-up is an inevitable process, just like the concept of mobile network from 2G to 3G, and then to 4G and 5G. With the upgrading and development of technological applications, the requirements for the network will become higher and higher. In addition, the competition among the three major operators in the fixed-line broadband market is now in a white-hot stage. The number of mobile users has exceeded that of China Unicom, which has also posed a great threat to China Telecom. Whether the three operators can seize the entrance to the high-speed network is crucial." said Xiang Ligang, a senior communications expert.

Concepts outweigh usage

With the strong publicity, Gigabit broadband has attracted the attention of many consumers. In theory, Gigabit-level Internet speed should be welcomed by everyone, but the Beijing Business Daily reporter randomly interviewed some consumers in Beijing and got unexpected feedback. Ms. Han, who sells cosmetics, said that although the speed of Gigabit broadband is very attractive, the Internet at home is generally only used for shopping, social networking sites, watching movies, etc. A network of tens of megabits can meet daily needs, so she will not spend more money to switch to Gigabit broadband.

"Apart from the relatively high price, gigabit network is still very attractive to me, so even if the price is high, I will upgrade the network if necessary," said Mr. Li, who works in the IT industry.

According to the information on Beijing Mobile's brochure, the price of gigabit broadband in Beijing is 800 yuan per month, 9,600 yuan per year, and 19,200 yuan for two years. Since April 9 was the lighting ceremony of the gigabit demonstration community of Beijing Mobile's "Gigabit Beijing Intelligent Optical Network", the promotional price on that day was 1,800 yuan per year, which was the promotional price for only one day and will be restored to 9,600 yuan afterwards. China Unicom's gigabit broadband adopts a monthly package of 1,000 yuan, and the annual fee is 12,000 yuan. Compared with the annual package price of 1,280 yuan for Beijing Mobile's 100M broadband and 1,780 yuan for Beijing Unicom's 100M broadband, the price of gigabit broadband has indeed doubled.

In terms of application scenarios, the use of gigabit broadband is also quite special. Beijing Mobile said that gigabit broadband can be used to experience VR (virtual reality), watch virtual movies, and experience virtual life in movies. It is expected that the 2020 Olympic Games will use 8K video for live broadcast, and 8K video viewing requires gigabit broadband for full protection. At the same time, gigabit broadband can meet the data collection of various home smart devices and customize smart home life.

Wu Chunyong, CEO of Fusion Network, believes that according to the current industrial development environment, the gigabit broadband business is still in its early stages of development, and its costs and other aspects are high-end, so the initial market positioning will definitely be high-income earners, people with specific professions and hobbies, such as residents of villas and high-end apartment buildings, players who play high-bandwidth game requirements, and people engaged in high-tech such as IT.

"We have not yet set a plan for nationwide popularization, but are only conducting pilot projects in some areas, first of all to meet the needs of consumers with high-speed Internet." A relevant person in charge of China Telecom admitted. China Unicom said that Unicom still needs to determine its market positioning based on the consumer experience in different regions.

In addition to demand, price and other factors, equipment upgrade is also a necessary condition for using gigabit broadband. Xiang Ligang told the Beijing Business Daily reporter that it is useless if the network equipment does not support high-speed broadband access. Gigabit broadband access requires matching hardware such as optical modems, routers, network cables and network cards, and users also need to pay for the upgrade of these network hardware.

It will take several years to become popular

Through investigation and interviews, Beijing Business Daily reporters found that only a very small number of consumers are willing to pay for gigabit broadband, and the vast majority of users are still satisfied with the existing network. "In the future, as various industry chains based on video content such as 4K, 8K, and VR develop, gigabit broadband will be accepted by the general public. That period will be the stage of popularization of gigabit broadband services. The market prospects of gigabit broadband will depend on the development speed of various applications, 4K, 8K and other industries. After all, gigabit broadband is just a rapid improvement in bandwidth services, just like the highways built around us. When the highways are built, everyone should be encouraged to take the highways, but if users do not even have suitable vehicles, they will naturally not be able to get on the highways." Wu Chunyong said.

Xiang Ligang predicted that gigabit broadband may not be popularized in China until after 2023. At present, most domestic users are still using broadband products of tens of megabits, and 100-megabit broadband has not yet been popularized. "This year, the main products promoted by operators are still 100-megabit broadband and 200-megabit broadband. Next year, it should rise to 300M, the year after, 400M, and 500M in 2020. This is a gradual process."

Wen Ningrui, general manager of China Unicom's marketing department, also introduced that with the help of the comprehensive layout of optical broadband networks, 100M high-speed broadband has become Unicom's main promotion speed this year, and it will gradually advance to 200M, 500M and gigabit broadband within the year.

Some netizens pointed out that speed increase and fee reduction should be carried out simultaneously. Without speed, broadband has no value no matter how low the price is. If the price is too high, no matter how fast the speed is, it will only become "chicken ribs". Regarding the price issue, Xiang Ligang revealed that the cost of broadband has indeed increased a lot from copper cable to optical cable, but broadband above 20M belongs to optical network, that is to say, most parts of the country have now achieved full optical network coverage, from 20M to 50M, and then to 100M and even gigabit, because they are all based on optical fiber networks, so the cost increase is not much. In the future, the price of gigabit broadband will definitely drop gradually, just like the 4G network, from pilot to popularization, it is a process of gradually popularizing the price.

In fact, not only the three major domestic operators have launched gigabit broadband, but other countries have also built or are building gigabit networks. As early as 2015, Rogers, Canada's most influential Internet content provider, announced that it would speed up its broadband network to gigabit speeds to meet users' needs for watching 4K programs. Recently, the German Ministry of Transport and Digital Infrastructure BMVI released the "Gigabit Germany for the Future" strategy, planning to invest 100 billion euros by 2025 to build a high-performance national broadband network and build a gigabit infrastructure by 2025, on which basis to realize applications such as VR, Internet of Everything, and Industry 4.0.