Contents
A quick background of NGBBN 3
The Next Generation Broadband Network is aimed at providing cheap, governmentsubsidised
fibre to home and office networks in Singapore. This should serve to
lower prices for broadband players and create competition for data services.
3
A quick recap of events leading to the NGBBN 3
The key element is the wholesale rate 5
We think the market has focused too much on who won the OpCo and NetCo
contracts and not enough on the wholesale rate. A concession contract with the IDA
is a step forward, but a highly affordable wholesale rate is a leap forward for retail
service providers.
5
The importance of the wholesale pricing point 5
Subscriber adoption will take a while 6
We expect the migration to the NGBBN to span several years, as shown by the
gradual migration to FTTH in other Asian markets. Concerns about an immediate
erosion of broadband and data revenues of the incumbents should thus be
tempered.
6
Takeaways from other more advanced markets suggest a gradual migration 6
NGBBN’s potential impact on companies 7
The creation of a technologically superior, government-subsidised broadband
network will result in some disruptions in the market. We see competition rising in
the retail and commercial segments. New services and revenue streams may also
develop, in our view.
7
Three-pronged effect of the NGBBN 7
Company impact 9
The smaller players should benefit, as they get access to cheap infrastructure, while
the broadband market share of larger incumbents may come under pressure. We
recommend that investors Buy M1, and Hold SingTel and StarHub.
9
Company profiles 12
MobileOne Ltd 13
Singapore Telecom 18
StarHub 23