2012 Singapore - Telecoms, Mobile and Broadband

Singapore’s national broadband network roll-out moves closer to completion

Singapore has developed the status of a world leader in telecommunications through the building of a high quality and extremely progressive regulatory environment for the local telecommunications sector that has, in turn, generated a highly competitive market. The Infocomm Development Authority (IDA), the nation’s telecoms regulator, reports that Singapore’s fixed-line household penetration rate is 104% (late 2012); about 20% of the population have two fixed telephone services at home. At the same time, its booming mobile market has a penetration of 150% and that market is continuing to grow. Singapore’s 3G market segment is also growing strongly. By the start of 2010 there were already 4.8 million 3G subscribers; making up about 66% of the total mobile subscriber base at the time. With eight million mobile subscribers in the country by end-2012, almost 80% of these were 3G customers. In other words 3G subscribers 3G had rapidly become the ‘normal’ mobile service in the country.

As Singapore’s mobile market continues its expansion, the numbers of broadband access and data services are also increasing at an impressive rate. As at September 2012, the IDA reports a number of key indicators in this regard:

• Residential Wired Broadband Household Penetration Rate of 107%;
• Wireless Broadband Population Penetration Rate of 162%.

With strong leadership from its government and good support from its telecom service providers, Singapore is both a regional leader and a global player in telecommunications. The island-state certainly generates a positive outlook in its local telecommunications sector. The country has built what is widely seen as a high quality and extremely progressive telecommunications regulatory regime that has, in turn, resulted in a richly competitive market. All restrictions on direct and indirect foreign ownership within the country’s telecom sector have been lifted. In such a progressive commercial environment, ‘over 100%’ of homes have fixed-line telephone connections, according to the telecom regulator. More than 20% of homes have two fixed line services.

At the same time as building its sophisticated telecoms infrastructure, Singapore has successfully promoted itself an IT hub and a place of excellence when it comes to all things to do with IT and telecommunications. The nation is determined to maintain its status and in the process it has been embarking on new and innovative telecom and IT projects.

Although incumbent Singapore Telecommunications (SingTel) continues to play a major role in the local telecom sector, liberalisation has seen a host of new operators entering the market, helping to exploit the competitive situation. In the lead up to officially liberalising the market, the government issued five facilities-based and 29 service-based licences. Prompted by the arrival of strong competition in its own backyard, SingTel decided to expand offshore and, in what eventually turned out to be a successful strategy, the company has been able to establish a considerable presence in regional markets, including 100% ownership of Optus, the second ranked mobile operator in Australia. Its offshore presence includes subsidiaries in India, Indonesia, the Philippines, Thailand, Pakistan and Bangladesh.

And through its alliance with Bharti Airtel in India it has further market presence in Bangladesh, Sri Lanka and Africa. By September 2012 the SingTel group had 468 million mobile subscribers across its many markets.

With the government pushing to move Singapore into the forefront of IT development, the IDA announced in 2008 that S$1 billion (US$725 million) had been allocated by the government to support the building and operating of a national optical fibre-based network as part of what was called the Next Generation National Infocomm Infrastructure (Next Gen NII); the strategy also included a wireless network. The government contracted an Operating Company (referred to as the OpCo) and a Network Company (referred to as the NetCo) in 2009. By 2011 the roll-out of the national network seemed to be proceeding at a good pace. However, at the start of 2012 the IDA intervened in the building process following concerns at the slowing rate of rollout. There continues to be some nervousness within the industry about the way the development is not running as smoothly as planned.

Key highlights

• Singapore’s overall mobile telephone penetration passed the 150% mark and was close to 8 million subscribers coming into 2013;
• The country’s 3G market continues to boom: there were around 6.3 million 3G subscribers by September 2012; this meant that 79% of all mobile subscribers are 3G;
• Effectively 100% of Singapore’s households now have some form of high speed broadband internet access;
• The Next Generation National Infocomm Infrastructure (Next Gen NII), Singapore’s large scale project to build an island-wide broadband network, is well underway;
• While the IDA had initially reported good progress on the roll-out of this network, in 2012 it intervened in the construction process amid growing concerns about slow progress;
• The IDA continues to maintain that the network will deliver universal coverage on time (target: 2013);
• Against the trend observed in most other markets around the world, fixed-line telephone services in Singapore remain remarkably resilient with what the IDA describes as more than 100% of households connected to the fixed network;
• Not surprisingly, growth in the fixed network has flattened out at around 2 million subscribers.

Singapore: - key telecom parameters – 2011 - 2013

(Source: BuddeComm)

Note: ¹includes both fixed and mobile broadband services

Data in this report is the latest available at the time of preparation and may not be for the current year.