Sunday, April 05, 2009

Singapore: 100/50 Mb/s triple play for under 40 EUR/mo

IDA has ordered Nucleus Connect to construct the active layer (switches and routers, including network termination equipment (NTE) at the subscriber) of the Singapore NGNBN (Next Gen NBN). A presentation is here.

Here are the specs of the entire network:
  • Part of the iN2015 policy.
  • FTTH PON network, in the familiar 3-layer model. Structural separation between passive and active layers, operational separation between active layer and any RSP owned by the same company (i.e. StarHub). Open access (OA) at layer 2 and 3 (slide 8).
  • Passive layer to be built by OpenNet (SingTel 30%, Axia NetMedia 30%, SP Telecomms 15%, Singapore Press 25%). Subsidy SGD 750m. Residential wholesale tariff 15 SGD/line/mo, business 50 SGD/line/mo, no connection fee.
  • Active layer to be built by Nucleus Connect, a separate StarHub company. Subsidy SGD 250m. Tariffs (include OpenNet fee; all in SGD/line/mo): residential 100/50 Mb/s for 21, 1.0/0.5 Gb/s for 121; business: 100/100 Mb/s for 75, 1/1 Gb/s for 860.
  • Open access to retail service providers (RSP).
And here is the timeline:
  • Nucleus to be incorporated April 17 2009, RfP to formally close October 2009.
  • Service launch April 2010.
  • Coverage 60% by end of 2010, 95% by end of 2012.
  • Universal service obligation from 2013.
  • 2015 targets: 330k residential subs, 80k business subs.
Some remarks:
  • Pretty much fits my ideal for a FTTH network, featuring structural separation of the passive network. See what is does for ownership and bringing in third-party investors. SingTel may spin-off network assets into OpenNet. It goes even further than New Zealand (structural separation only once Telecom NZ gains a majority share) or KPN/Reggefiber (functional sepapartion 'only'). It is striking to see how functional separation in the NL is defended by referring to the competitive situation (nationwide cable coverage), which has nothing to do with it - see Singapore, where structural separation is forced because the network needs to function properly, not because there is competition from some other network.
  • Too bad it's PON, not P2P (slide 24).
  • The 1 Gb/s offering is neat, though.
  • The residential offering is asymmetrical. We are seeing more of this, because FTTH needs to be positioned above DSL (i.e. more expensive), including business DSL.
  • The 2015 targets appear to be quite modest, for a state that is home to 4.8m.
  • We'll be on the lookout for RfPs to equipment manufacturers. RSPs are suggested to bring their own residential gateways (see slide 26). The NTE will allow end-users to get services from several RSPs at once (as limited by the number of ethernet ports on the NTE, I suppose).
  • The 100/50 Mb/s service will be 21 SGD/mo for the RSP (just over 10 EUR/m0), the 1.0/0.5 Gb/s service will be 121 SGD/mo (60 EUR/mo) at the wholesale level for RSPs. The retail price for a triple play will add a margin plus the cost of both TV and telephony. It looks like an extended TV package is 37 SGD/mo, and telephony (line rental, unlimited local calls) is around 10 SGD/mo. The fast triple play would then be around 68 SGD/mo (EUR 33,50), the ultra-fast triple play 168 SGD/mo (EUR 83), before earning the RSP a margin. I suppose the triple play will be commercially available for under 40 EUR/mo.
  • MobileOne lost this round, but has stated it will be a RSP. Sureley SingTel will be one too.
Next in line: Australia is due this week to award its NBN contract.

1 comment:

Paolo said...

Interesting post.

About the 2015 targets: IHMO, it doesn't look a modest plan. Let's take as an example residential broadband: Singtel and StarHub have each around 300k residential customers (2004, 2007 data). The number of households(*) in the country is estimated around 1M (2000 data) of which 56% are equipped with internet connection (2003 data). In 2015 (it should already not be the case in 2009) it will not be half of the market anymore, but still a relevant fraction of it.

It would be 3 years from when 95% of the country is covered, with saturated market conditions and a current economical downturn (which doesn't help selling premium products).

Then it will also depend on the RSPs: how quickly they will be ready, how much they are willing to push that platform compared to the existing ones (perhaps self-owned and hence providing higher margins?), which services they will offer and in which timelines (as adding a new access method to an existing infrastructure is not always transparent to services, expecially in case of wholesaled access from 3rd parties).

(*) Singapore Dpt. of Statistics: