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China's Big Bet on Broadband Infrastructure

China's spending on broadband aggregation harware (MSAPs and IP DSLAMs) in 2007 roughly quadrupled that of Japan and South Korea, according to a market study by Infonetics Research.

The report, Broadband Aggregation Hardware in Asia Pacific: China, Japan, and South Korea, says China represents about 50 percent of the $2.0 billion spent on broadband aggregation hardware in 2007 by Asia Pacific countries.

"China presents the largest market for broadband aggregation hardware in the Asia Pacific region as deployments accelerate in the run up to the 2008 Olympics in Beijing," said Mark Showalter, directing analyst for broadband networks at Infonetics Research.

"Although the Asia Pacific broadband aggregation hardware market is the largest in the world, DSL sales in the region flatten after 2008 as services shift from copper- to fiber-based access, as we've already seen in Japan and are starting to see in South Korea."

Other highlights from the Infonetics study include:

- Asia Pacific represents close to 1/3 of worldwide total telecom capex, and over 1/3 of global broadband aggregation equipment spending.

- Service providers in India, Taiwan, Singapore, Malaysia, and Indonesia are deploying more copper-based DSL services than other regions of Asia and together represent a healthy MSAP and IP DSLAM market.

- The primary drivers for the shift from copper-based to fiber-based services include IP network transformation projects and traffic increases boosted by video, IPTV, online gaming, and P2P applications.

- In China, Huawei and ZTE hold the #1 position in IP DSLAM and MSAP markets, respectively.

- In the Rest of Asia Pacific region, which includes Asia Pacific countries other than China, Japan and South Korea, UTStarcom enjoys the #1 position in MSAPs and Alcatel-Lucent leads in IP DSLAMs.

- Nokia Siemens leads in both IP DSLAMs and MSAPs in South Korea, thanks to their acquisition of local Dasan Networks.

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