BROADBAND PROMOTING MARKET ENTRY

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BROADBANDPROMOTING MARKET ENTRY COMPETITION
THEME ADDRESS Mr LEONG Keng Thai,
Director-General and Deputy CEO, IDA
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High broadband penetration is important

• Broadband is an enabler
• Uses
• Voice over IP - VoIP
• entertainment-on-demand
• interactive community games
• greater productivity for businesses.
• There is vast growth potential in the broadband
  markets in Asia.

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Singapore

• Significant broadband growth
• Household penetration of broadband is 36 as of
  March 2004.
• ie, more than 1 in every 3 household
• Increase in broadband users from 30 from
  2001-2002.
• 950,000 in 2001 to 1.24 million in 2002
• Statistics from the annual Survey on Broadband
  and Wireless Usage in Singapore, 2002.

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Success Factors

• Effective competition, with open access and / or
  strong viable inter-modal competition.
• Regulatory policies which promotes market entry
  and competition.
• Affordable prices play a vital role in users
  adoption decisions and is the key to increasing
  broadband penetration.

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PROMOTING MARKET ENTRY
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Welcome Open Entry

• Not limiting the number of players.
• In most markets, there are only a few dominant
  telcos.
• Customers tied with these few dominant telcos.

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Welcome All Technologies

• Encourage inter-modal competition
• digital subscriber lines (DSL)
• cable modem
• WI-FI
• satellite
• optical fibre
• power lines
• Wireless technologies
• Successful technical trials, pilots and
  commercial deployments of wireless broadband
  technologies have been carried out in several
  countries like the US, Australia and South Korea.
• Adopt technology neutral approach

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Lowering the cost of market entry

• Governments must help operator minimise costs
  associated with market entry.
• Examples
• Streamline simplify licensing fees and
  procedures
• Optimise spectrum allocation
• Use of "unlicensed" spectrum
• Where there is sufficient competition, can
  consider forbearance

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Simplified licensing procedures

• Reduce the hassle and associated costs in getting
  a licence to start operations.
• Options
• lowering licence fees
• do away with the initial one-time licence fee
• Registration only
• Canada
• Japan

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Spectrum Allocation

• Resources necessary for broadband deployment must
  be allocated in a timely manner at reasonable and
  fair rates
• Ensure that spectrum is made available
• In Singapore, dedicated spectrum in the 2.3 GHz
  and 2.5 GHz spectrum bands allocated for trials
  and commercial deployment of wireless broadband. 
• How governments regulates and allocate spectrum
  will affect take up of spectrum wireless
  broadband deployment.

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PROMOTING COMPETITION
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Basic Principle Manage Bottlenecks

• Need for a sound regulatory and policy framework
• independent regulation
• reasonable regulations
• transparency
• timely enforcement
• Basic principle is to control market power and
  bottlenecks where there is potential to abuse.
• Government intervention is sometimes necessary
  but should be targeted.
• Private public sectors must work together.

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Unbundling and Co-location

• Unbundling is usually mandated in many countries
  because only the incumbent operators have the
  pervasive networks.
• Examples of unbundling co-location
• Japan
• Hong Kong
• Singapore

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Open Access

• Allow competing service providers to offer
  broadband internet access service existing
  incumbents networks.
• In Singapore, open access on both ADSL and Cable
  modem networks mandated.
• Other Examples
• Korea
• Canada

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Resale Wholesale

• Encourage resale as it will enable fast rollout.
• Promote competition at wholesale level.
• Examples
• Canada
• Singapore
• Dominant licensee is required to file its
  wholesale DSL tariffs with IDA.

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Summary

• Promote Market Entry
• Welcome open entry
• Welcome all technologies
• Lowering costs of market entry, eg license fees,
  spectrum allocation
• Promote Competition
• Manage bottlenecks
• Unbundling co-location
• Open access
• Resale
• Wholesale

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Conclusion

• Competition fostered by regulation.
• Targeted regulation.
• Governments role in promoting market access and
  competition is significant.
• Governments should support the private sector as
  the engine of growth and ensure that the
  macro-environment is stable.