- Healthy competition among Internet Service Providers can increase consumer choice, reduce prices, and foster innovation, efficiency, and Internet quality.
- Russia and Brazil have the best competitive Internet Service Provider markets.
- Nearly 80% of countries have poor or very poor market competition.
The Internet’s success and resilience are largely due to the interconnectivity of the global network. The more networks that connect with one another, the more routes businesses and end users can choose from to share and get products and services.
Many technical and economic factors support this interconnectivity, one of which is market competition. Healthy competition can increase consumer choice, which in turn can reduce prices and foster innovation, efficiency, and quality as competing businesses seek to differentiate their products from each other.
Most importantly, the impact of when one Internet Service Provider (ISP) experiences an outage in markets with no significantly dominant ISP is not as great as those experienced by the likes of Australia, Canada, and Italy over the last few years.
How Do We Measure Market Competition on Pulse?
Pulse collates data on market competition for each country for the Pulse Country Reports via IIJ’s Internet Health Report.
The underlying measurement behind the Very Poor to Excellent rating we have adopted to indicate the market competition in each country is the Herfindahl–Hirschman Index (HHI). This commonly used calculation measures market concentration by squaring each ISP’s market share and adding up the resulting numbers. A low HHI score indicates a healthy level of market competition.
| HHI score (per IIJ) | Pulse Market Competition Rating |
|---|---|
| Less than 500 | Excellent |
| 501—1000 | Very Good |
| 1001—1500 | Good |
| 1501—2000 | Fair |
| 2001—3500 | Poor |
| More than 3500 | Very Poor |
Countries with a large number of ISPs usually receive a low HHI rating per this indicator. As of May 2025, two countries have an ‘Excellent’ market competition rating: Russia (HHI=289) and Brazil (HHI=332) (see interactive).
Figure 1 shows the market share of the top five ISPs in Brazil and Russia, giving you an idea of what an ‘Excellent’ profile looks like. Collectively, they account for less than 32% of the total market.
Figure 2 shows the market share of the top five ISPs in Nigeria and Romania to give you an idea of what a ‘Very Poor’ profile looks like. For these and similar Very Poor profiles, you will see one very dominant ISP controlling nearly 60% of the total market. Quite a contrast.
One data point that may have grabbed your attention in the above figure is Starlink’s (2%) market share in Nigeria. As SpaceX signs more contracts with governments to offer its services legally in their countries, we expect to see this figure increase and impact market competition in many countries.
One example of this happening is in the Federated States of Micronesia. Although their market competition rating is currently ‘Very Poor’, since Starlink arrived, its underlying HHI score has dropped significantly from 5,224 in May 2024 to 3,727 in May 2025, visibly impacting FM Telecom’s market share (see interactive).
In my next post, I’ll dig into where we are noticing the greatest change in market competition and see how this is impacting the Internet resilience of the affected countries.
Image by Angela Bedürftig from Pixabay