Bad times for NBNs as incumbents flex muscles

Tony Brown / Informa Telecoms and Media
27 Sep 2013
00:00
News
Commentary

For the true believers in Fiber-to-the-Home (FTTH) services delivered by a National Broadband Network (NBN) model it has been an unhappy couple of weeks.

Firstly, the heavy defeat of the Labor Party in Australia’s Federal Election saw the end of the line – for now at least – of the FTTH dream, with new communications minister Malcolm Turnbull set to deliver a re-designed Fiber-to-the-Node (FTTN) dominated model.

Secondly, and perhaps more worryingly, have been developments in Singapore where market giant SingTel has moved to take full control of OpenNet, the joint-venture company which is building the country’s Next Generation National Broadband Network (NGNBN).

Under the terms of the deal SingTel would sell its 30% stake in OpenNet to NetLink Trust – a fully owned SingTel entity – for S$38 million with OpenNet’s other shareholders, Singapore Press Holdings, Canadian firm Axia and SP Telecommunications, selling their 70% stake to NetLink for S$88 million.

In addition, SingTel has also requested to the Infocomm Development Authority (IDA) that it be allowed to extend the deadline for reducing its stake in NetLink to below 25% by up to four years.

The move has been furiously opposed by rival operators M1 and StarHub, Retail Service Providers such as MyRepublic, SuperInternet and ViewQwest as well as Nucleus Connect – which operates the active infrastructure on the NGNBN – who are all urging the IDA to reject the deal.

In their submission to the IDA the opponents of the deal say that there are, “Grave concerns….over the competition issues raised by the proposed consolidation, including the potential of discriminatory treatment and a lack of independence by OpenNet.”

The non-SingTel sections of the market have long been critical of the performance of OpenNet in deploying services into the market, claiming that the firm was deliberately slowing down the installation of the NGNBN to office buildings in order to protect SingTel’s dominance in the enterprise market.

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