Rivals of SingTel are probably applauding the timely arrival of a fireball that took down several telecommunications and banking services across Singapore earlier this week.
Oh okay, so I exaggerate, it wasn't exactly a fiery inferno of a fireball, but it was still a fire, no less, and one that damaged 149 cables at SingTel's Bukit Panjang exchange. It crippled the services of SingTel rivals, M1 and StarHub, as well as those offered by various companies including banks and Singapore Pools. DBS said its ATM and AXS services were affected, including 18 of its branches such as Changi Airport and Raffles Place, and OCBC's 11 ATMs were hit.
Sales and payment operations at all 300-plus Singapore Pools outlets, except the main branch, came to a crashing halt, and the country's only legal lottery operator was forced to delay its Wednesday 4D draw from 6.30pm to 9pm.
The fire, which cause is still being investigated, damaged 81 of OpenNet's fiber cables, affecting about 23,000 fiber optic strands and 46,000 individual connections. According to SingTel, two-thirds of damaged cables were operated by OpenNet, which built and operates the national fiber broadband network (NBN).
Herein lies the reason why the fire is oh so timely.
SingTel in August announced its bid to buy out OpenNet for S$126 million, promptly drawing strong criticism from the industry over anti-competitive concerns and potential discriminatory treatment. M1 said the buyout contradicted the Singapore government's goal for the national fiber network to bring about a competitive and vibrant broadband market via an "alternate ubiquitous network that can effectively compete with the only ubiquitous legacy network in Singapore".
SingTel already owns the only copper network that runs nationwide.
"The proposed consolidation will result in SingTel having 100 percent indirect ownership of OpenNet, which would negate the government's initial goal and further entrench SingTel's incumbent position," M1 said.
Six local broadband players alongside a coalition of Asia-Pacific carriers also banded together to jointly issue a strongly worded 38-page statement demolishing the potential SingTel-OpenNet buyout, which is still pending the approval of regulator Infocomm Development Authority of Singapore (IDA). "If approved, the proposed consolidation would see SingTel becoming the 100 percent beneficial owner of the only other nationwide fixed telecommunications network in Singapore, apart from SingTel's own network.
"The unprecedented show of solidarity [between the broadband players] demonstrates the grave concerns the industry has over the competition issues raised by the proposed consolidation, including the potential of discriminatory treatment and a lack of independence," the group added.
It outlined concerns over potential monopolistic advantage, anti-competitive market conditions, and lack of transparency should IDA allow the buyout to proceed. These are further exacerbated by OpenNet's already blemished record of rollout delays, missed appointments, and inadequate quality of service, it said.
OpenNet last October had been warned by IDA over its failure to meet customer service quality standards in its delivery of the NBN service.
A common thread among the industry critics centers around the fact that there is "only one other" nationwide network infrastructure, and it's pretty clear what happens when that one network is brought down to its knees. This is bound to happen when you run your services on an inverted pyramid--one chop at the one at the bottom will bring everyone else down with it.
Singapore is a small market, so it wouldn't make much economic sense to build out multiple network infrastructures to serve an already saturated enterprise and consumer market. However, because the country's communication and connectivity needs are served mainly by one core infrastructure, it's vital this network should operate as independently as possible. All the necessary safeguards also should be in place to ensure this network has no single point of failure and is backed by plenty of contingency, so there's always a failover option to keep services running in the event of, well, a fire.
In a statement about fire incident, IDA said it had launched an investigation to identify the cause and will "take appropriate action" to prevent it from happening again. "Under the Telecommunication Service Resiliency Code, operators are required to ensure the design of their networks and services are resilient to service outages, and when outages do occur, to ensure they restore the services expeditiously."
Ironically, it said it had completed a "review of the resiliency" of the mobile networks of Singapore's three mobile operators in areas such as network design, technical processes, business continuity planning, and infrastructure.
The regulator said it would continue to review the country's telecommunications infrastructure, closely examining resiliency of all critical parts of the national infocomm infrastructure. Findings from this will be detailed in its new audit framework, it said.
It still baffles me how a fire that appeared to be contained in one cable room, on one level of a building, was able to cause such extension damage and disruption to so many services. Where's the failover? Why didn't the backup or contingency plan kick in? Is there even a contingency plan to begin with? There must be one, surely, so why wasn't it able to prevent so many banking and business services from going down?
I think these are questions IDA need to ask not only while it's working on the new audit framework, but also while it's reviewing whether it should approve the SingTel-OpenNet buyout.