The MDU Battle for the Truly Big Pipe

The World's MDUs and MTUs: Another Silly Digital Divide?
By Jimmy Schaeffler, the Carmel Group

A recent study by The Carmel Group researched and analyzed the world's market place for both residential multiple dwelling units (MDUs) and commercial multiple tenant units (MTUs). The study took weeks to complete and drew key resources from in-house, and the governments and political units of many countries and regions of the world, as well as domestic and global trade associations, to name but a few. In the end, almost 5,000 data points were collected and analyzed, all aimed toward an understanding of how telecommunications will access these environments. Yet ultimately, what was critically important was neither the volume nor the basis of the report, but rather the conclusions.

The overriding challenge that was presented is that of a Digital Telecom Divide, that might first impact the MDU and MTU occupants of the world's five billion or so residents in the few years ahead. This will be especially marked in regions of the world such as Central Africa, large parts of Latin America, parts of southeast Asia, and in a few widely scattered countries, such as Indonesia, Columbia and Nigeria. The expected reason for this gap between the broadband "haves" and the broadband "have nots," is the apparent inability of service providers, vendors and system operators to coalesce business plans that will service the information, entertainment and other telecom and computer needs of occupants and tenants in roughly 400 mil. MDU buildings in the major regions of the world. These regions are highlighted below.

The United States and Canada

In the 50 states, a state-by-state analysis compiles somewhat less than fifty million MDUs and MTUs altogether. Four main regions made up the study, labeled the Pacific/West, Midwest, Northeast, and Southern. The greatest number of MDUs and MTUs in a given region fell to the the 17 states that make up the "Southern" region, which by themselves have four more states and about 36 million more inhabitants than the next nearest runner up region, the "Pacific/West." Looking specifically at MTUs and MDUs in the U.S. today, the study indicates that there are nearly seven hundred thousand MTUs, and about8.2 mil. MDUs overall. Yet even here, the percentages receiving broadband are surprisingly low.

Canada has twelve provinces, with about two thirds of the total population of nearly thirty million residing in Ontario and Quebec. The average number of MDU occupants/MDU resides between 1.8 (in Saskatchewan) and 2.6 in the Northwest Territories. The number of MTU buildings in the entire country measures less than three hundred thousand. In general today, the percentage of MTU buildings receiving broadband today is five percent, whereas the percentage of MDU buildings receiving broadband is a meager three percent.

Latin America

Of the 25 countries that make up Latin America today, ranging from Mexico in the north to Argentina and Peru in the south, total TV households measure slightly less than 80 mil. The population is well over half a billion, and the urban percentage of that number is close to two thirds. Of those numbers, more than ten percent reside in almost sixty million MDUs. MTU buildings in Latin America number far less than two million. Yet the percentage of MTUs receiving broadband is in the single digits, and the percentage of MDUs receiving some form of broadband is even lower.

Europe

For Europe's 26 Eastern and Western countries, and its almost 650 mil. inhabitants, 71% are considered "urban," and total househholds with TVs number almost a quarter of a million. Of this population, about 15% live in MDUs, and the percentage of buildings receiving broadband in the MTU environment is higher than any other region in the world, i.e., well into the double digits. Countries such as the United Kingdom, France and Germany are the three that are highly penetrated by broadband, whereas Albania, Latvia and Estonia fall on the other side of the access spectrum.

Africa and The Middle East

For the 23 countries making up this region of approximately 800 mil. people, almost half are deemed "urban." The percentage of MDU buildings vs. the general population is the second lowest after Asia, and the percentage of buildings passed by broadband is only slightly above zero percent, which is the lowest in the world. Similarly, the percentage of MTUs receiving broadband is only slightly higher, indicating that, like so many other measurements of wealth and well-being in the world today, Africa has the greatest room for improvement.

Asia

Finally, for the 24 or so countries making up the greater Asia and Asia/Pacific region, more than 3.2 bil. people reside there, almost half are labeled "urban," total households number almost 900 mil., and more than three and a half people live in each household, on average. Yet here, too, broadband has not grown rapidly, nor is it expected to under present plans. The percentage of MDUs receiving broadband is less than five percent, with Japan, Taiwan, Australia and South Korea being the only four countries that register in the double digits. The same four countries, plus Singapore and New Zealand, are those that can claim double digit percentages of MTUs that are capable of receiving broadband.

A Long Way To Go

In summary, there's a lot of pent-up demand for new broadband to new high occupancy residential and commercial units around the world. If the world's businesses and MDU residents are going to be allowed to access the information and entertainment that is and will be broadband, those access means must be developed and implemented soon. Otherwise, the world may be once again establishing additional classes of peoples, based upon whether they have the good luck to live in and/or work in a single building or the bad luck of living and/or working in a multiple tenant/unit building. I'm no expert, but it sure seems a silly distinction to me.

About the Author

Jimmy Schaeffler researches, analyzes and writes this regular report for Broadband Communities Magazine. He is a subscription TV, broadband, and consumer electronics analyst at The Carmel Group (www.carmelgroup.com), a publisher and consultancy based in Carmel-by-the-Sea, CA. The company specializes in telecommunications, computers and the media. His e-mail address is jimmy@carmelgroup.com. His telephone number is 831/643 2222.