NETLINK TRUST ACCEPTS PRICE REVISIONS FOLLOWING IMDA'S REVIEW
- Leveraging its nationwide network coverage to support the growing number of connections to residential homes and non-residential premises
- To become a lead partner in the development of new fibre-based initiatives, including the Singapore government’s Smart Nation programme
Singapore, 8 May 2017 – NetLink Trust, the sole appointed “Network Company” for Singapore’s Next Generation Nationwide Broadband Network (“Next Gen NBN”), accepts the price revisions for its services provided to Requesting Licensees1 outlined by the Infocomm Media Development Authority (“IMDA”). This comes after IMDA’s review of NetLink Trust’s prices for the services offered under its Interconnection Offer and Reference Access Offer. (More details of the pricing model are provided in the Appendix.)
Since commencement of the roll-out of Singapore’s fibre network infrastructure in 2009, this is the first revision to the monthly recurring fees relating to NetLink Trust’s services for residential, non-residential, non-building address point (“NBAP”) and segment fibre connections. IMDA last reviewed the prices under the Interconnection Offer in 2013. With respect to each residential end-user connection, non-residential end-user connection, NBAP connection and segment fibre connection, NetLink Trust currently receives both a one-time installation charge and a recurring monthly fee. NetLink Trust also generates revenue from the provision of services in connection with its other non-fibre passive infrastructure (comprising ducts, manholes and central offices).
As of 31 March 2017, NetLink Trust has passed2 more than 1.4 million residential homes, or substantially all of the residential homes in Singapore, and reached3 1.3 million residential homes. The network is also deployed4 to approximately 30,000, or substantially all of the non-residential premises in Singapore as of 31 March 2017. Approximately 1.1 million residential end-user connections are supported by NetLink Trust’s fibre network, representing approximately 76% of all residential premises “home passed” in Singapore. NetLink Trust also supports approximately 38,500 non-residential end-user connections, representing approximately 31% of the corporate wired broadband connections.
NetLink Trust also deploys fibre to NBAPs, being locations in mainland Singapore or its connected islands other than a physical address or location with a postal code, such as roadside points, bus stops, traffic lights and multi-storey car parks. NBAP applications include fibre connectivity for telecommunications operators (such as wireless network base stations), surveillance cameras, sensors, outdoor digital signage, outdoor kiosks and ATM machines. NetLink Trust anticipates that the demand for NBAP services will continue to grow with the roll-out of Singapore’s Smart Nation programme, which aims to apply digital and smart technologies to improve citizens’ lives in key domains. NetLink Trust believes that the Trust Group is well positioned to provide the fibre requirements of future initiatives through its extensive nationwide fibre broadband network. A number of NetLink Trust’s NBAPs were provided to the successful bidder for “Phase 1” of the Smart Nation programme for the purpose of connectivity to aggregation gateway boxes that provide connectivity for sensors that record environmental data.
Mr Tong Yew Heng, CEO of NetLink Trust, said, “Fibre broadband services are an essential service for consumers, given the growing demand for connectivity and rapid rise in data consumption. Fibre connectivity is supported by the relatively high purchasing power among the Singapore population and affordable fibre broadband services offered by Retail Service Providers. NetLink Trust’s nationwide network is key in supporting continued demand for fibre connections. We believe the price revisions can ultimately benefit consumers and further drive fibre penetration in residential homes. Enterprises are also expected to switch to fibre network services and NetLink Trust is poised to leverage on our nationwide network coverage to capture future growth in the non-residential segment. We are also well-positioned to capitalise on growth in connected services including the Singapore government’s Smart Nation initiatives.”
Note to the Editor: Do refer to NetLink Trust’s website for key facts and figures http://www.netlinktrust.com/about-us/about/facts-figures.html
About NetLink Trust
NetLlink Trust’s nationwide fibre network is the foundation of Singapore’s Next Generation Nationwide Broadband Network (“Next Gen NBN”), over which ultra-high-speed internet access is delivered throughout mainland Singapore and its connected islands. NetLink Trust designs, builds, owns and operates the passive fibre network infrastructure of Singapore’s Next Gen NBN.
The provision of NetLink Trust’s services is largely regulated by IMDA. NetLink Trust provides open and equal access to all qualified industry operators. Through our network, NetLink Trust provides a range of services including:
(a) the use of our network for the purpose of end-user fibre connections, currently for broadband, internet-protocol TV and voice-over-internet protocol (“VoIP”) services;
(b) the use of our other passive infrastructure to provide fibre connections; and
(c) the provision of other non-fibre ancillary services.
As the sole appointed "Network Company" for Singapore's Next Gen NBN, NetLink Trust’s network consists of approximately 76,000 km of fibre cable, 16,200 km of ducts, 62,000 manholes and ten central offices, as of 31 March 2017.
NetLink Trust’s extensive network provides nationwide coverage in Singapore in terms of residential homes and non-residential premises. We are the only fibre network with nationwide residential coverage in Singapore. As of 31 March 2017, NetLink Trust supports approximately 1.1 million residential end-user connections, representing approximately 76% of all residential premises “home passed” in Singapore; NetLink Trust also supports approximately 38,500 non-residential end-user connections, representing approximately 31% of the corporate wired broadband connections. NetLink Trust also has 357 NBAP connections across Singapore.
For more information, do visit http://www.netlinktrust.com/
For media queries, please contact:
Citigate Dewe Rogerson, i.MAGE
CHIA Hui Kheng / Dolores PHUA / Amelia LEE Tel: +65 6534 5122 (Office Hours)
E-Mail:
APPENDIX
The Interconnection Offer (“ICO”) prices of NetLink Trust will be regulated using the Regulated Asset Base (“RAB”) model for the price review period starting on or around January 2018 to December 2022, a five-year review period (“Review Period”). The RAB model has been employed taking into consideration that the technology for the underlying passive civil infrastructure network of NetLink Trust (mainly ducts, manholes and fibre) are not expected to change significantly over the near term.
The RAB model allows NetLink Trust to recover these cost components: (a) return of capital deployed (i.e. depreciation); (b) return on capital employed; and (c) operating expenditure. Key assumptions in the RAB model include:
- The base year of the RAB is 2012. Asset purchased up to and including 2012 are valued at 2012 prices, whereas assets purchased after 2012 are valued at actual cost. The annuity method is used for the purpose of regulatory depreciation. In computing the regulatory depreciation, the useful life of ducts and manholes is assumed to be 35 years and fibre (and related infrastructure) is assumed to be 25 years;
- The return on capital is based on a nominal pre-tax Weighted Average Cost of Capital (“WACC”) derived using the Capital Asset Pricing Model (“CAPM”) approach. The pre-tax WACC for this Review Period is 7%. The formula is as follows:
IMDA may change rate of applicable pre-tax WACC in future review period.
IMDA may exercise its discretion or NetLink Trust may propose to conduct a mid-term adjustment in the third year, in the event that there is any significant change in cost inputs or if any changes to cost or demand forecasts are required due to unforeseen circumstances.
Kindly refer to IMDA’s website for details of the price revisions.
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1. An entity that NetLink Trust must offer certain Mandated Services to upon request under the terms set out in the Interconnection Offer. SingTel, StarHub and M1 are examples of Requesting Licensees.
2. Residential premises for which NetLink Trust’s network has been deployed up to the distribution point of each floor (for a high-rise building containing two or more residential premises) or to the gatepost or, where applicable, to the nearest manhole for a landed building containing one residential premises.
3. Residential premises for which NetLink Trust’s network has been deployed up to the first termination point in the residential premises.
4. NetLink Trust’s network has been deployed up to the Main Distribution Frame (MDF) room of the non-residential premises.