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Thailand Ranks Top in Internet Speeds Globally to Promote Digital Economy

Looking back at the extraordinary year 2020, the sweeping COVID-19 pandemic brought a major setback on the world economy. Human society is facing unprecedented challenges, and the ways people work and live have completely changed. However, we have also seen that despite the pandemic, Thailand's digitalization process has accelerated and the development of the digital economy has entered the fast lane. Thailand's e-commerce industry grew by 81% compared with last year, which is quite a surprise. According to the 2020 e-CONOMY SEA report, the growth of the e-commerce industry can compensate for the loss of tourism and logistics industries due to the decrease in foreign tourists. In 2020, the gross merchandise value (GMV) of Thailand's digital economy is about US$18 billion, which is about ฿540 billion, a seven percent increase over the previous year. It is estimated that by 2025, the total value of Thailand's digital economy will reach US$53 billion (about ฿1.59 trillion), with an annual growth rate of 25%. The total revenue of the online vehicle booking and food ordering service industries in Thailand reached ฿33 billion in 2020. It is estimated that as consumers' behavior changes, the average annual growth rate of the two industries will reach 45% by 2025.

For individual users, convenient and high-quality broadband services are very attractive. According to a study of Resume.io (a Dutch online resume maker), Bangkok is the most attractive Asian city for digital nomads. It also ranks fourth in the world due to its convenient Internet and low cost of living. Resume.io also points out that the ranking of Thailand's capital shows that Thailand is a "popular country which nomadic workers come in without hesitation after the pandemic".

According to the Thailand Digital Outlook 2020 which is released by the Ministry of Digital Economy and Society (ONDE), before the pandemic, Thais spent more than 3.7 hours a day on the Internet on average, but during the pandemic, they spent 4.6 hours a day on the Internet on average. 80% of the users believe that Internet technologies play an important role during COVID-19 and become indispensable in people's daily life. Among these users, 35.3% of individual or home users access online public service websites through home network. They visit these websites for paying water and electricity bills, settling the income tax, accessing online banking services, and learning online courses. Other usages of the Internet include visiting social media, chatting, and online shopping.

The ICT network provides sound support for the development of digital services such as home office, online learning, telemedicine, and e-commerce. As a key part of the ICT network, home broadband in Thailand has ushered in a new development cycle. Ookla released a report on Thailand's HBB rate which shows Thailand's HBB rate increased from No. 9 to No. 3 in the world in this year, lower only than Singapore and Hong Kong. But the number of Thailand's users is much larger than Singapore and Hong Kong. Thailand's HBB rate ranked top among countries of similar user scale.

In 2020, the average download rate of Thailand's HBB reached 168.81 Mbps, which ranked second in ASEAN and was lower only than Singapore's 214.39 Mbps. The download rate increased rapidly in this year and the average download rate of the Phrae Province in Q4 2020 reached 462.12 Mbps, increasing by 102.2% compared with 228.55 Mbps in Q1. Statistics show that Thailand's HBB rate leaped to the top in only one year. According to Ookla's data, the average download rate was only 36.88 Mbps in July 2017, increased by only 10.47 Mbps to 47.35 Mbps in August 2018, but sharply increased by 130 Mbps to 177.35 Mbps by December 2019, ranking No. 4 in the world.



Rome was not built in one day. When conducted third part reports from OVUM and World Bank on the development history of Thai fixed broadband networks in the past five years and the result shows fixed broadband network in Thailand has made great progress since 2016. The following 4 key factors have driven the development.

Statistics show Thailand keeps increasing the investment on optical fiber networks since the 5-year master plan for the digital economy was launched, and now optical fiber networks are available in both rural and urban areas. By the end of Q4 2020, FTTH had covered over 17 million households. Ninety percent of urban users can enjoy 100 Mbps services, and even gigabit services are provided in some areas. All villages have access to broadband. At the same time, Thailand's international infrastructure is improving. In the past few years, Thailand invested in 8 submarine cables to connect the country to the world. It seems that Thailand is most closely related to all ASEAN countries, which makes it suitable to be a digital hub.

Optimization of ARPU

The number of fixed broadband users keeps increasing and reached 11 million by Q4 2020. The proportion of households with fixed broadband has exceeded 60%. The number of users with 100 Mbps or higher access rates keeps increasing and has exceeded 8 million, taking up 90 percent of the total number of users. The number of users with 500 Mbps or higher access rates increased by 4 million (including upgraded and new users) compared with the end of last year.

Improvement on User Experience

User-perceived Internet access rates have significantly increased. As mentioned above, according to Ookla's report on HBB rate, the average download rate of Thai fixed broadband networks is 166.81 Mbps in Q4 2020, 4.6 times of that in 2016.

Coordinated Broadband Development in Different Regions

Thailand's government report shows that 30,635 of 74,987 administrative villages in the country have been covered with broadband networks. As for the left 44,532 villages without broadband networks, Thailand's Digital Ministry provided 24,700 villages with 30 Mbps/10 Mbps broadband access through the Village Broadband Internet Project included in the master plan of USO Prajat which is led by ONDE.

Besides, USO Net Rural Project which is led by NBTC (Office of The National Broadcasting and Telecommunications Commission) covered 15,732 villages, and USO Net Project on the Edge covered the remaining 3,920 villages in remoter areas. These projects have promoted the construction of broadband access ports in rural areas, expanded the coverage of access networks, and improved broadband user access rates. Optical fibers covered all the 74,897 villages and reached every school in 2020, further narrowing digital divide.

We have also learned that these achievements depend largely on the support of national industry policies. The Thai government puts great emphasis on the infrastructure of digital economy, especially broadband networks. It launched "the 20-year National Digital Economy Masterplan", "the 5-year Digital Economy Plan" and "the 10-year Digital Economy Plan", providing guidance on promoting network development and improving development environment. With all these efforts, Thailand witnessed the rapid development of broadband networks, and realized the network development goals. This drives its technological advances, economic and social development, and the high-speed growth of the digital economy.

McKinsey's latest report points out the trend of Industry 4.0 will accelerate Thailand's economy recovery after the pandemic.

Technological advances and social changes are rapidly changing enterprises' operation ways, and COVID-19 is accelerating this trend in operation-intensive companies. In the post-COVID-19 economic environment, it might be easier to hire people with the key skills that a company needs in the coming years, such as data scientists and IoT engineers. Companies with long-term talent demands also need to strengthen their internal capability development, especially for the key roles that require knowledge and digital skills in professional domains, such as translators or product owners. The Thai government is responding to the talent demands of private sectors by supporting the projects that enhance digital skills and improve infrastructure, and joining the public-private partnerships about talent and digital ecosystems. The long-term goal is to promote the digital economy vision in Thailand's 4.0 strategy.

The fixed broadband revenue and users of Thai operators keep increasing.

The 2020 performance reports released by Thai operators show that the increase of broadband rates drives the HBB revenue and users of the three tier-1 operators to increase. According to the report from 2016 to 2020, the operator’s HBB revenue has increased from $4.3B Baht to $5.3B Baht, the growth rate is 25.1%, and the user has increased from 5.5M to 8.95 M, the growth rate is 63%.

Internet has become indispensable like sunshine, air, and water for people nowadays. Everyone's life is changing because of the Internet and the changes will continue. Fixed broadband networks drive the booming of the digital economy. The convergence of broadband networks and the real economy is deepening and expanding, forming the new modes, business forms, and industries of the digital economy. Broadband networks have become the new engine and momentum for quality economic development.