The Infocomm Development Authority of Singapore (IDA)
has appointed the OpenNet consortium as the network company (NetCo)
for the country's planned next-generation National Broadband
The IT regulatory body announced Friday the Axia NetMedia-led
consortium would be responsible for building the fibre
infrastructure of the NBN.
OpenNet, which comprises Canada-based Axia and three local
companies, SingTel, Singapore Press Holdings and SP
Telecommunications, was in competition for the government contract
with Infinity consortium. The latter was initially formed between
Singapore telcos MobileOne (M1) and StarHub and Hong Kong's City
Telecom (CTI), but CTI dropped out last month and was replaced by
Qatar Investment Authority (QIA).
Minister for Information, Communication and the Arts, Dr Lee
Boon Yang, declined to comment on whether Infinity's restructuring
negatively impacted its bid. Speaking during a press conference, he
said it is "not appropriate to consider this factor", but that
the IDA's decision was made based on the merits of each
consortium's request for proposal (RFP) outline.
Khoong Hock Yun, IDA's assistant chief executive,
infrastructure development group, said one of the highlights of
OpenNet's proposal was its ability to reuse existing underlying
passive infrastructure, such as ducts, manholes and exchanges. This
lowers the cost of the roll out, as well as minimising disruptive
building activity and inconvenience to the public, he said.
The consortium will use SingTel's existing passive
infrastructure assets to deploy the network, said Lee. SingTel
owns a substantial portion of the country's existing duct network,
which SingTel CEO Singapore, Allen Lew, has said is more extensive
than competitor, StarHub's network.
However, part of the proposal states SingTel will transfer these
assets to a neutral party within 24 months of the NetCo's
contractual close. This party, known as the Asset Company
(AssetCo), will be independent and separately-managed.
SingTel will reduce its stake in the AssetCo within five years
of the contractual and financial close. Future maintenance of the
fiber assets will be entrusted to the AssetCo.
Lee said OpenNet has proposed an accelerated roll-out of the
NBN two years ahead of the IDA's initial schedule. Sixty per cent
of households and buildings will get wired up by 2010, with 95
per cent coverage expected by 2012. "From 2013, OpenNet will meet
all subsequent requests to install fibre access points in homes,
offices and buildings throughout Singapore," he said.
OpenNet has proposed wholesale prices of S$15 per month
per residential fibre connection and S$50 per month per
non-residential connection. These prices will be extended to the
next layer of operating companies (OpCos) which will repackage
services atop this layer and retail packages to consumers at a
The government will provide OpenNet with a grant of up to S$750
million to support its effort, said Lee.
StarHub CEO Terry Clontz said in a statement emailed to the
press: "We are disappointed that the Infinity Consortium was not
selected for the NetCo project.
"The Infinity Consortium proposed what we believe is a very
good solution for Singapore's long term success with the Next-Gen
NBN. Also, our proposal would have substantially diversified, for
the first time, fixed infrastructure ownership."