# Speedtest® Market Report

### Hong Kong

#### Published June 13, 2017

Hong Kong leads the world with some of the fastest upload and download speeds for fixed broadband, but their mobile speeds fall far behind, according to recent Speedtest data. As of Q4 2016-Q1 2017, Hong Kong ranks third in the world for broadband internet download speed at an average speed of 142.65 Mbps. Hong Kong’s average mobile download speed of 18.05 Mbps ranks 57th in the world. Both broadband and mobile download speeds increased steadily with 13.7% and 5.1% gains over a 12-month period.

Internet usage has boomed in Hong Kong since the internet opened to the public in 1991, and Hong Kong has established itself as a modern telecommunications hub. This Special Administrative Region (SAR) of China now ranks 66th in the world for number of internet users. The SAR ranks 27th globally in percentage of internet users, with 84.9% of Hong Kong’s population using the internet daily, compared to 43.9% of the world, according to 2015 data from the World Bank.

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## Market Analysis

Composed of more than 200 islands, Hong Kong has been called one of the best countries for business and financial development. Despite its economic muscle, the SAR does not rank among Asia’s most populous cities. Hong Kong’s population includes over 7.3 million people, with an average age of 44. The average household size in Hong Kong is 2.8 people.

Hong Kong’s free market economy incentivizes trade and finance, helping it secure its spot in the top 50 countries with the largest purchasing power/gross domestic product (GDP), at $427.4 billion. The gross national income (GNI) per capita is $41,000. Hong Kong’s close connection with mainland China via a “one country, two systems” agreement makes China the SAR’s primary trading partner. Major industries include textiles, clothing, tourism, banking, shipping, electronics, plastics, toys, watches and clocks. Hong Kong’s integration with mainland China specifically supports the sustained growth of the finance and banking industries. As recently as April 2017, PCCW Global and Keppel Data Centres announced plans to launch an internet exchange in Hong Kong to connect regional businesses faster, with long-term goals to further boost the SAR’s economic growth.

Hong Kong’s autonomous government has been in place since the 1997 “one country, two systems” agreement. Hong Kong has no separate independence, although it is governed by a presidential limited democracy, with the president of China as the chief of state. Hong Kong has a separate constitution from China, and its executive, legislative and judicial government branches are autonomous.

Hong Kong’s unique distanced supervision under China makes it an interesting study of unregulated internet usage. China is well known for its strict online governance and internet browsing restrictions; however, Hong Kong is not subject to these laws. Hong Kong citizens enjoy uninhibited online browsing, whereas their mainland neighbors still face prosecution and criminal charges for breaking firewalls or visiting banned sites with frequency. This freedom could contribute to the sustained growth of Hong Kong’s telecommunications industries and its prevalent online user presence.

## State of the Industry

The World Bank data from 2015 shows 32.1 broadband subscribers for every 100 people in Hong Kong. Connections are growing exponentially; the prevalence of internet servers has increased by a staggering 53.9% since 2013, with more than 959 internet servers per million people in 2016. Hong Kong’s online presence is collectively over 12.5 million connections strong as of Q4 2015. Over 80% of Hong Kong households have computers, and 79% have internet access at home.

Fiber infrastructure in Hong Kong shows significant gains from 2016 to 2017. Most notably, Hong Kong is currently slated for one of the largest fiber projects in the world beginning in 2017. In October of 2016, Facebook and Google announced plans to construct the Pacific Light Cable Network, a fiber-optic cable stretching over 7,200 miles from Los Angeles to Hong Kong. The market impacts of this massive project can’t be assumed, but on the consumer front, fiber internet capacity is anticipated to reach up to 120 Tbps following construction.

The GSMA reports 72% of the SAR had mobile broadband for internet connections in Q4 2015. This is a 4.46% increase from Q4 2014. 2.5G, 3G and 4G connections have been steadily growing since 2007, when there were just 2.9 million customers. That number has increased a whopping 438% (to 15.6 million customers) in the past 10 years, according to statistics released by Hong Kong’s Office of the Communications Authority. The average mobile customer used 1,471 MB of data in 2017, up from 11 MB in 2007, per the same report. Companies are testing 4.5 network technology in preparation for the 2020 commercial launch of 5G in Hong Kong. Some carriers have pushed for a new spectrum release plan to adhere to that schedule and keep up with other areas of the world.

### Hong Kong Fixed Broadband Speeds

### Report Stats

#### TEST COUNT:

961,136

#### 1-YEAR CHANGE (DOWNLOAD):

13 %

#### 1-YEAR CHANGE (UPLOAD):

0 %

Speedtest data from Q4 2016-Q1 2017 shows that the average broadband download and upload speeds in Hong Kong are fast at 142.65 Mbps and 126.59 Mbps, respectively. Download speeds have increased 13.7% year over year, while upload speeds have increased 0.2%.

Speeds vary across Hong Kong’s 18 districts, comprised of Hong Kong Island, Kowloon and the New Territories. Within Hong Kong Island, the Central and Western district, the Southern district, and the Wan Chai district boast the fastest broadband download speeds (140.76 Mbps, 128.54 Mbps, and 149.79 Mbps, respectively). Within Kowloon, Sham Shui Po district has the fastest broadband download and upload speed at 180.61 Mbps and 160.60 Mbps, followed by the Kwun Tong district (164.89 and 151.58 Mbps), and the Wong Tai Sin district (155.96 Mbps and 138.82).

Hong Kong Island also contains the slowest district we surveyed: the Eastern District. This area still showed a respectable 86.83 average download speed and a 80.53 average upload speed.

District | Download (Mbps) | Upload (Mbps)
--- | --- | ---
Sham Shui Po District | 180.61 | 160.60
Sha Tin District | 167.38 | 149.60
Yuen Long District | 166.19 | 153.04
Kwun Tong District | 164.89 | 151.58
Wong Tai Sin District | 155.96 | 138.82
Wan Chai District | 149.79 | 126.70
Yau Tsim Mong District | 146.47 | 128.28
Central and Western District | 140.76 | 128.70
Kowloon City District | 130.71 | 114.40
Southern District | 128.54 | 114.00
Tsuen Wan District | 108.70 | 94.25
Eastern District | 86.83 | 80.53

### Competitive Overview

NETVIGATOR, Hong Kong Broadband Network (HKBN), 3HK and i-CABLE are the major competing broadband providers in Hong Kong. NETVIGATOR holds the bulk of the broadband market, with a 60% market share of total broadband users. HKBN holds 22% of the users within the Hong Kong broadband market, followed by 3HK with 15% and i-CABLE with 3%.

In 2008, the Hong Kong government announced a broadband policy called the Digital 21 Strategy to facilitate a digital economy and incentivize broadband providers. Provider SmarTone continues to be a market partner with HKBN. Significant international mergers and acquisitions have contributed to market growth in recent years. Notably, 3HK expanded beyond Hong Kong and entered the UK market in 2017 after it acquired UK Broadband. In 2016, HKBN announced its acquisition of New World Telecom, a Canadian telecommunications equipment supplier. Other major providers haven’t fared as well: in 2017 i-CABLE will be sold to new investors as part of a $129 million refinancing strategy due to lack of funding.

### Hong Kong Fastest ISPs

### Download

#### FASTEST: HKBN

Hong Kong Broadband Network (HKBN), as its name suggests, holds the majority of broadband business in Hong Kong. The company’s fast download speeds are unmatched in the market, offering Fiber-To-The-Home (FTTH) and Fiber-To-The-Building (FTTB) broadband plans at speeds of 100 Mbps, 500 Mbps, and 1,000 Mbps.

### Upload

#### FASTEST: HKBN

HKBN has been a leading broadband service provider in Hong Kong since 2000. The company’s competitive edge over the Hong Kong broadband industry includes expensive tactics that competitors may find difficult to replicate, such as money-back guarantees if certain speeds are not met.

HKBN is the fastest broadband provider for Hong Kong downloads and uploads with lightning-quick upload and download speeds of 544.18 Mbps and 544.07 Mbps, respectively. Those speeds represent a 1.5% increase and a 7.0% decrease from the same period the year before, respectively.

#### HOW SPEEDTEST MEASURES FIXED BROADBAND

ISPs offering fixed broadband services are ranked based on top speed performance, which is determined using the 90th percentile of the download and upload speeds, or Top 10%, of each ISP’s Speedtest results. While many ISPs offer various service tiers, our aim is to determine who is fastest by showing the performance achieved by each residential ISP’s top tier. These speeds represent customers who subscribe to faster service tiers and provide an accurate view of the top-end performance of a given ISP. It is important to note that customers subscribing to higher tiers will generally pay more for their service than the average subscriber. For purposes of this report, only Top Providers in a given location were included in the analysis. Each ISP that accounts for at least 3% of the total sample size in the geographic area are included as a Top Provider. When analyzing Hong Kong overall, we use the average speed, as it represents the experience of a typical consumer in Hong Kong. When comparing ISPs individually, we use top speed performance, as it represents the performance a consumer could reasonably expect to receive if they subscribe to one of the ISP’s higher tiers of service.

### Hong Kong Mobile Speeds

### Report Stats

#### TEST COUNT:

615,502

#### 1-YEAR CHANGE (DOWNLOAD):

5 %

#### 1-YEAR CHANGE (UPLOAD):

1 %

Speedtest data shows the average download and upload speeds over mobile in Hong Kong are 18.05 Mbps and 8.61 Mbps, respectively. This represents a 5.1% increase in mobile download speed and a 1.2% increase in mobile upload speeds from Q4 2015-Q1 2016.

Districts with the fastest mobile download speeds are dotted throughout Kowloon, Hong Kong Island and the New Territories. Download performance in Kowloon was especially unpredictable. This section of the SAR has the fastest district (Wong Tai Sin, 23.02 Mbps), and also the slowest (Yau Tsim Mong. 3.79 Mbps). Upload performance was similarly unpredictable, with the fastest districts spread across the SAR.

District | Download (Mbps) | Upload (Mbps)
--- | --- | ---
Wong Tai Sin District | 23.02 | 11.72
Central and Western District | 18.44 | 8.87
Sha Tin District | 14.91 | 11.57
Kowloon City District | 13.59 | 7.16
Kwun Tong District | 11.81 | 4.11
Yau Tsim Mong District | 3.79 | 2.74

### Competitive Overview

Hong Kong’s major mobile internet competitors are csl, 3HK, SmarTone and China Mobile Hong Kong (CMHK). Though csl holds one of the lowest market shares for broadband internet users, it is the highest for mobile internet use, claiming to be the mobile broadband leader in Hong Kong. In 2016, Hong Kong Telecommunications Limited (HKT) stated that csl had been successfully integrated into their business after its 2014 acquisition.

In other partnerships, SmarTone and Ericsson announced plans to launch 5G applications across various industries. SmarTone appears to be on track for continued growth in the next year, boosted by its service expansion. Notably, SmarTone’s new voice over Wi-Fi service launched in 2016. 3HK announced that it is upgrading its 5G network in 2017, and CMHK recently launched a new and improved Supreme Service Plan, covering roaming across 70 countries around the world.

### Hong Kong Fastest Mobile

### Download

#### FASTEST: csl

csl’s growth in the mobile broadband market has escalated with the introduction of Hong Kong’s only 4G 375 Mbps LTE-A network. The company claims that the new plans are up to 50 times faster than before, and can cover nearly all of the districts within Hong Kong.

### Upload

#### FASTEST: csl

csl has invested in its customer’s needs for expanded mobile broadband roaming outside of Hong Kong - especially to mainland China. The company now offers a unique Always-Be-Connected Data Pass plan that allows mobile broadband users to continue service at more than 170 destinations across the globe, including China, Canada, Brazil, and the United States.

The fastest mobile carrier in Hong Kong for both downloads and uploads is csl. Speedtest data show that csl mobile download speeds were 25.23 Mbps in Q4 2016-Q1 2017, a 0.7% increase from the same period the year before. csl’s mobile upload speeds during the same period dropped 0.2% to 12.57 Mbps.

#### HOW SPEEDTEST MEASURES MOBILE CARRIERS

The top mobile carriers in Hong Kong are ranked using the average download speed of “Modern Devices” - those devices that are capable of connecting to the fastest, broadly-available wireless networks. In Hong Kong, this means devices capable of 4G LTE. This ensures we provide an accurate view of the typical performance a user can achieve using a modern smartphone or tablet on a given mobile network. Top carriers are those that each account for at least 3% of the sample size in the geographic area. When analyzing the country as a whole, we use the mean value of all cellular results to account for the typical user. However, when analyzing individual carriers, we look at “Modern Devices” to account for top speeds available in Hong Kong.

## Market Summary

Hong Kong is on a strong trajectory for sustained broadband growth in the next year, and data indicates a sustained upward trend. The much-anticipated introduction a fiber cable from Los Angeles to Hong Kong will no doubt further improve the state of the region’s fixed broadband.

Mobile broadband speeds, on the other hand, are nowhere near as impressive. Though speeds are increasing, they are much slower than we’d expect to see in an economic powerhouse like Hong Kong. Although the number of 2G and slower subscriptions continue to decline and 3G and 4G subscriptions are increasing, significant improvements in infrastructure and a push to get more people on 4G and faster connections could put Hong Kong on par with Europe and the United States.

Written with contributions by Diane Pulvino.

This report was revised on June 15 to include additional provider information.

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