Singapore on top with NBN, Australia's plans near standstill

Thursday 2 September 2010 | 09:18 CET | Market Commentary

While Australia is still working on a new government coalition that could lead to the country’s NBN plans being put on the backburner, Singapore has launched commercial services on its NBN. Everyone agrees universal broadband is important, but the question is still, how much is enough and how long should it take to achieve it?


Australia’s plans for a National Broadband Network are the most ambitious, given the size of the country. It’s expected to cost around AUD 40 billion, the majority of which will come from the government over a period of eight years. Over the same period, around 25,000 people will work on the project. Construction has started with a backbone, a network in Tasmania and in various other locations. Fibre will be rolled out to 93 percent of the locations, with mobile and satellite used for the rest.


The recent elections have put the plans in question. Small parties will be the key to forming a coalition and are mainly in favour of the NBN. However, a group of seven smaller operators, under the Alliance for Affordable Broadband, have made a counter-proposal. Their alternative, called NBN 3.0 (the current plan is called NBN 2.0), would cost a maximum AUD 3 billion. It would include a 4G network covering 98 percent of the population, supplemented with fibre to institutions such as schools and large businesses and as backhaul and satellite for remote areas. The alliance leaves the door open for FTTH: “A fibre-based solution (whether that be FttP or FttN or combination of both) for areas of demonstrated need via commercial return, or where there is a demonstrated and justifiable improvement in productivity and/or social equality to justify tax-payer contribution”. The alliance wants broadband left to the market and competition at the passive infrastructure level (NBN 2.0 chose for competition at the active level). The alliance alludes to to LightSquared, the US wholesale-only LTE network to be launched next year (see our commentary ‘Open LTE network in US reaches next phase’), which has a budget of just USD 7 billion. Furthermore, it isn’t entirely clear how the alliance’s commitment to free markets and competition relates to any NBN plan, as a NBN seems to imply some sort of monopoly, albeit regulated.


Things have moved along further in Singapore. The country has chosen for competition on the services level, although SingTel will manage the active layer itself for business customers. The active layer operator Nucleus Connect was the one to announce the launch of the commercial Next Gen NBN on 31 August (later than the original plan for April 2010). It’s clear Singapore’s geography is a bit easier than Australia: highly urban and small. Nucleus Connect, part of StarHub, got the contract in April 2009 and already has network coverage at 40 percent of all locations. The network should be completed in 2013. The passive layer is being deployed by OpenNet, which started in September 2008. OpenNet includes local partners (mainly SingTel) and the Canadian company Axia NetMedia, which specialises in open fibre-optic networks. The technology is GPON, with also Optical Ethernet for business sites.


The Singapore model appears to be immediately successful. With SingTel (the incumbent) on the passive layer and StarHub on the active layer there are already five retail service providers active: in addition to SingTel and StarHub, there’s M1 (mobile operator), SuperInternet (newcomer) and LGA (business provider). Another five parties are in talks to become retail providers. Looking at the prices, while the network is not yet finished and more providers are expected, the Singapore consumer already appears to be doing well. At SingTel, SGD 85.90 per month (EUR 49.75) gets you a broadband connection at 150 Mbps download, 75 Mbps upload and 15 Mbps to servers outside Singapore, unlimited fixed calls in Singapore, video calling and 10GB storage. For SGD 109.90 (EUR 63.65), the download speed rises to 200Mbps, IPTV is included and you get a discount on a mobile service plan. At M1, a 100/50 Mbps subscription costs SGD 59 per month (EUR 34), and students who also have a mobile plan at M1 pay just SGD 39 (EUR 22.60).


The situations in Australia and Singapore show again what the discussion surrounding NGAs is all about. There are three crucial questions:
• At what point should FTTH be adopted? How long can the existing infrastructure last? Can LTE play a role or is it just complementary?
• Should the government get involved? Through regulations, services development or financing?
• Is real competition based on infrastructure the target or does that not deliver sufficient competition? Should open access be imposed? If so, at what level: active (such as in in Australia, but also in the Netherlands at Reggefiber and CIF and in Singapore for the business market), or only at the services layer (such as in Singapore and in the Netherlands at eg OONO and CAI Harderwijk)?
NB: At our Broadband NL 2010 conference on 13 October in Rotterdam these important questions will be up for discussion.

Free Headlines in your E-mail

Every day we send out a free e-mail with the most important headlines of the last 24 hours.

Subscribe now

::: add a comment