1 1 Asia Pacific: the third global IP traffic region April 2004 Sturt Eastwood Director, Europe

2 2 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

3 3 Will IP Follow Telephony? (ITU World Telecommunication Indicators Database) Asia- Pacific 22% Europe 41% Americas 35% Africa/ Arab States 2% 1991 Total Telephone Subscribers 555 million Asia- Pacific 29% Europe 36% Americas 33% Africa/ Arab States 2% 1996 Total Telephone Subscribers 877 million Asia- Pacific 36% Europe 35% Americas 27% Africa/ Arab States 2% 2001 Total Telephone Subscribers 1’979 million Total telephone subscribers = mobile + fixed line

4 4 Top Level Regional Indicators EMEA Population - 1.6b GDP per cap. - US$5,986 Internet Access (%) % Broadband (%) - 0.8% EMEA Population - 1.6b GDP per cap. - US$5,986 Internet Access (%) % 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 b GDP per cap. - US$15,050 Internet Access (%) % Broadband (%) - 2.9% Americas Population b GDP per cap. - US$15,050 Internet Access (%) % Broadband (%) - 2.9% Source: ITU, Birth of Broadband, Sept, 2003

5 5 International IP Backbone Capacity 62.1 Gbit/s Gbit/s Gbit/s 4.4 Gbit/s Source: Global Internet Geography, 2004, Primetrica

6 6 IP Backbone Bandwidth Growth Trends Source: Telegeography, International Bandwidth 2004

7 7 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%

8 8 Direct Europe-Asia Capacity Sing to London RTD is 192ms Via the US RTD is 368ms Source: Gartner IP Backbone Opportunities, 2003

9 9 Broadband Penetration by Region RegionThousands of Lines (31/12/03) Asia Pacific44,109 EMEA24,777 Americas31,983 Source: Point Topic, 2004

10 So Where is the Broadband Market Going? Asia broadband rates are ten times faster than in North America and Europe. Corning, 2003 Asia broadband rates are ten times faster than in North America and Europe. Corning, 2003 Asia Pacific will continue to dominate global 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 dominate global 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 Topic Top ten broadband countries by lines added Source: Point Topic The number of Chinese Internet users connecting to the Internet over broadband connections rose by 173% during CNNIC, 2004 The number of Chinese Internet users connecting to the Internet over broadband connections rose by 173% during CNNIC, 2004

11 Broadband Pricing and Download Speeds Aust. $88 1.5M Aust. $88 1.5M China $24 2M China $24 2M HK $51 6M HK $51 6M India $ M India $ M Japan $36 45M Japan $36 45M Korea $35 8M Korea $35 8M Philipp. $50 0.3M Philipp. $50 0.3M Malay. $26 0.5M Malay. $26 0.5M Sing. $ M Sing. $ M Taiwan $36 3M Taiwan $36 3M $35 1.5M $35 1.5M $34 1.5M $34 1.5M UK $67 1M UK $67 1M Ger. $69 2M Ger. $69 2M France $48 1M France $48 1M REACH research – typical residential broadband packages, April, 2004 $45 3M $45 3M

12 REACH Global IP Backbone Network During the last year, direct Asia to Europe IP backbone bandwidth has increased from 155 to over 700 Mbit/s During the last year, direct Asia to Europe IP backbone bandwidth has increased from 155 to over 700 Mbit/s Over the past year, intra-Asia IP network capacity has Increased from 6.3 to 13.9 Gbit/s Over the past year, intra-Asia IP 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 To Hong Kong Equinix NYIIX LINX Newark Palo Alto Miami Dallas New York Washington DC NAP of the Americas Equinix Los Angeles San Jose Equinix Tokyo Perth Sydney Auckland Jakarta JPNAP JPIX NSPIXP2 UAE New Delhi Guangzhou Shanghai Beijing Manila Singapore Kuala Lumpur Mumbai Seoul To London Bangkok HKIX Macau PAIX NIX SOX IIX GIX MIX Equinix To 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.

13 The Global Internet USA Europe AP USA Asia Europe Asia USA Europe 200?

14 Thank you REACH is an Asian-focused international carrier providing global connectivity services to carriers and service providers 14