Developing the tools to figure out what customers want and delivering services based on that insight will be the key differentiator and NBN is about open access not speed.
These were the main themes during a roundtable discussion that brought together eight telecom executives representing operators, the IDA and RSPs. The event, held in Singapore in October, was sponsored by Accenture and moderated by Telecom Asia group editor Joseph Waring.
The reason behind Singapore's national broadband network is actually not about speed, IDA assistant CEO Khoong Hock Yun said. "This is where the discussion gets derailed. It's really about effective open access, making sure everyone can get bandwidth at competitive prices. Speed we take for granted."
He said open access is the key factor that's spurs new services and innovation.
Singapore Press Holdings CIO Low Huan Ping agreed that there is sufficient bandwidth for what we want to do today. "The issue is with more fiber and more RSPs, is whether the cost can come down fast enough. If it does, I guarantee you more services will be introduced to use that bandwidth."
StarHub head of products and solutions Chan Kin Hung pointed to the lack of choice in the corporate segment, which has led to high prices. "When OpenNet comes in and companies have two choices, it will drive competition."
INREN managing director Mohan Narendran asked to what extent StarHub, SingTell and M1 will look at the NGN platform as something else to bundle with, such as mobile, IPTV and VoD plans. He says this will have a huge impact on RSPs because of the attractive consumer market. But he is concerned that the impact of the mobile way of living and working in the future hasn't fully been considered in the plans.
Since applications and services are a global business, OpenNet director Robert Chew suggested that the NBN will give local developers the opportunity to start locally then leverage other regional or global networks since it removes that barrier.
Gene Reznik, Accenture's global lead for telecom, pointed out that the basis of competition to date has been tied to infrastructure - who can provide ISP services.
"Let's assume at the end of the [NBN] transition period, say in five years, the legacy infrastructure as been sunset with open access and IP dialtone, if it were, available, are the providers ready to re-differentiate on branding, marketing, service innovation and bundling, or will new players move in?"
He noted that in the UK Carphone Warehouse is taking market share from the traditional players - and they are a consumer electronics company.
Reznik asks: "Are telcos ready to put their legacy and heritage competencies into someone else's hands and reinvent themselves as a brand company?"
Low said that raises the key issue of what is the future of a telco? "You can be a full-service player with quad-play or you can be a dumb-pipe provider. Given the open nature of the internet, the telco will have to work very hard to if they push to be quad-play provider, because they will be dealing with world-class players, like the Googles of the world."
SingTel EVP for consumer Yuen Kuan Moon agrees that is a view many consultants are pushing, but noted that one part missing in the full-service vs dumb pipe argument is telco's relationship with the end-user.
"It's not just about the brand, it's also about trust and being able to rely on the service. We all use Google, but how many of us have a relationship with Google in the sense that we can contact them when something goes wrong?"
He questioned whether using the new open access infrastructure Google, Microsoft or any of the internet players would be able "conquer the world by establishing relationships with everyone, everywhere. Is there another model for them to engage individuals?"
Nexwave Telecoms managing director Steven Ng warned everyone not to underestimate Google. "The relationship with consumers is being built today, and their financial aggression is amazing. What they've done the US is clearly a threat to all telcos. What's preventing them from going into other regions are all these [regulartory] regimes, where you still have things like the PSTN."
Ng reckons that broadband is a full replacement of the PSTN, but the PSTN is kept artificially because you want to keep it as long as you can since the infrastructure is there.
"What Google is prepared to do, understanding the evolution of VoIP circumventing the PSTN, is to provide everyone with a 3-series number. So today there's no stopping someone like them from saying, 'I've got this PSTN network, let me put in a multimedia device in every household that bypasses the PSTN'. So suddenly the users can give up all their numbers, which are replaced by a single IP number that can connect to your email and all the other innovative services."
SPH's Low said the FCC's current stance on network neutrality is fascinating because any new regulations on open access will have a major impact on how telecom services will evolve over the next few years.
Looking at the business case for Google moving forward, StarHub's Chan said its ad revenue have been funding their product innovation. "One day in two or three years, it just takes another company like Google coming along and they won't have funding to support all their indicatives."
Reznik pointed to the irony in that to some extent the bigger the pipe that telcos provide the more acceleration of internet services that they enable. He said the NBN will take us to a fundamentally different level where it's all about sales, service, bundling and subsidizes of consumer electronics.
"The RSP have an interesting opportunity to redefine the game and the value provided by the company supplying the telecom service," he said.
Khoong emphasized the challenge moving forward will be to understand the customer as the customer base becomes more sophisticated and more complicated to serve. Now consumers are the leader in adopting innovation while before it was the enterprise segment.
"Trying to watch the consumer and figure out what he wants and deliver that will be very tough, so having insight into your customer will be the differentiator," he said.
Rarendran said that as a potential RSP in Singapore he's interested in learning about demographics in Singapore, which is an important ingredient to being able to deliver health care, education and SOHO services.
Looking at ways to monetize services, Ng said in the short term he doesn't want to be totally reliance on the NBN by delivering quad-play type services, noting that a lot of the services he is planning don't depend on an NGN with 100-Mbps connection.
"Having the bandwidth it offers gives us the opportunity to watch that development and as it becomes more pervasive, I can start to offer other services that can really ride on this bandwidth," Ng said.
"Once I hit a certain scale, then maybe I can subsidize so they become more pervasive. But between now and then, I'm going to tread fairly carefully."
Because many firms will want to focus on the innovation and not think about access, OpenNet's Chew believes there is an opportunity for an ISP to play the virtual operator role and ensure the consumer never has to deal with the opco and the netco.
"It will be about branding their reliability and customer service. This would give the consumer a single point of contact, with seamless service cutting across the three layers and reduce complexity," he said..