By Gerry Blackwell

August 18, 2006

The independent island city-state has grand plans for wireless through the next decade.

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With all the unease in some American cities and some political circles about the notion of local government getting involved in providing wireless infrastructure – or just fostering development of infrastructure – it’s interesting to look at what one of the most successful cities in the world is doing in this area.

Singapore, the island city-state at the tip of the Malay Peninsula in Southeast Asia, has been involved in municipal Wi-Fi for a few years and is about to bring a major new public/private project to fruition. The new project will see large chunks of the 270 square mile city provided with Wi-Fi access by the end of 2008 and the entire city, indoors and out, blanketed by 2015.

Singapore’s social democratic administration has been a byword for government intervention in many areas. This may be anathema to some Americans, but it seems to work for Singaporeans. A large percentage of the population lives in government-built housing, for example. Nearly half use public transport, in part because of restrictions on driving private vehicles in the city. These and other environmental protection measures have resulted in very low levels of pollution.

The Singaporean government has also been very active in economic development and maintains a tight partnership with the private sector. This has contributed to a level of economic success that is almost unheard of in the region. Singapore, which is particularly strong in the high-tech sector, has one of the highest per capita gross domestic products (GDP) in the world.

Two years ago, a private sector group approached the government with the idea of establishing a network of hotspots in the city, using McDonald’s restaurants as the main venues. “The private sector expressed an interest, we thought it was a good idea, so we partly funded the setup costs,” says Hock Yun Khoong, assistant CEO in Singapore’s Industry Group Infocomm Development Authority.

That kind of project is typical of Singapore. Today, there are 800 publicly accessible hotspots in the city, some free, some for fee. “The private sector pays for operational costs,” Khoong notes. There are another few thousand hotspots attached to institutes of higher learning.

The new wireless access initiative is part of the government’s broader iN2015 plan, a ten-year “infocomm master plan” designed to “propel the nation into 2015 and beyond.” Among the objectives: tripling infocomm (computer and network related product) exports to about $38.5 billion, creating 80,000 new jobs, getting 90% of homes using broadband and ensuring that every home with a school-age child has a computer.

As part of iN2015, the government issued a “call for collaborators” (a type of request for proposal) from companies and consortia interested in building a series of interlinked wireless hotzones around the city. It considers this phase one of its broadband wireless plan, to be spread over the next two years.

Successful proposers will win a license to provide commercial service, an amount of government funding to be negotiated, plus access to government resources such as spectrum licenses if required and light poles for mounting access points.

“The funding might be important to some to help defray initial costs,” Khoong says. “But the real importance of this is that government is catalyzing the process, and providing regulatory clearance and other assistance. That’s more important to them than the money.”

In return for government assistance and sanction, successful proposers must meet certain minimum requirements. The government has identified 40 “catchment areas” where they must provide service, including 90% of indoor areas (though not on upper floors of hotels, for example). The obligatory hotzones, the smallest of which is two kilometers square, include tourist and shopping areas, as well as public areas in housing communities. Proposers were also encouraged to identify additional areas where they might want to provide service.

The government stipulated that service providers must offer a low- or no-price plan with at least 512 Kbps connectivity. Eight of nine proposers have proposed a free 512 Kbps service. (Proposed premium services range up to 4 Mbps.) In addition, service providers cannot block VPN, VoIP telephony or peer-to-peer traffic. “We want the network to be as open to such services as possible,” Khoong says. If it turns out that there are multiple service providers, they must also interoperate and allow free roaming.

The process is almost complete now. An evaluation team made up of government officials, academics, venture capitalists and others has already evaluated the nine proposals received and made its recommendations to the government, which is in the process of going back to the proposers with additional questions and preliminary negotiations on terms.

The iN2015 commission had divided the country into three regions and invited interested parties to make proposals to provide service in one, two or all three. The regions are all of about the same size and include a more or less equal mix of commercially attractive zones – “juicy” catchment areas, as Khoong puts it – and less attractive but obligatory areas such as low-cost housing developments. Government reserves the right to award licenses to one provider for all three regions or one for each, or to give one region to one provider and two to another.

However it divvies up the licenses, it expects to award them by this September. The first hotzones are to be up and running before the end of the year, the rest by the end of 2008.

The call for collaborators did not specify the technology to be used, but all the proposals include use of Wi-Fi. Some propose supplementing Wi-Fi with WiMAX at least in the later stages of the first phase. Others, especially the existing cellular carriers, have proposed supplementing Wi-Fi with HSDPA (High-Speed Downlink Packet Access), a WCDMA extension sometimes referred to as a 3.5G that will provide downlink capacity of up to 14.4 Mbps.

Khoong does not anticipate WiMAX or HSDPA being a major factor in the first phase, because not many users will be able to access the network using these technologies in the next two years — but they will eventually provide the kind of pervasive coverage the government wants as the country approaches the year 2015. Whether these technologies will eventually supersede Wi-Fi remains to be seen.

“Some people say Wi-Fi will no longer be required after five years,” Khoong says. “I’m not sure. After all, we still have the plain ordinary telephone system (POTS) after so many years. I think Wi-Fi has its own set of value propositions… it’s good enough for many applications.”

The proposers have estimated costs for implementing their business and technology plans at anywhere from $5 to $35 million per region. Some of the proposers with the biggest estimates are asking for the least amount of government funding, Khoong notes. The government will peg funding levels to performance – breadth of coverage area proposed and built, number of customers attracted, speed of access provided, etc.

A consistent philosophy underpins this type of private/public partnership that appears to be routine in Singapore and is exemplified by the iN2015 Wi-Fi project. In this case, the government sees a national benefit in making it easy for people to work and get access to the Internet or to private networks when they’re on the go.

The ultimate objective is to make Singapore and Singaporean businesses more competitive. The government believes this project will help boost worker productivity. It will improve quality of life, making it easier for companies to attract top talent to the city and keep people there. And it will contribute to making Singapore a more attractive place to do business and to operate a business. All of this impacts the country’s competitiveness.

But wireless access will only have these impacts if reliable services arise that people will use regularly. “Infrastructure,” Khoong says, “is a critical enabler to service development. So we believe government’s role is to ensure that the appropriate infrastructure is in place, but government doesn’t need to be the owners of the infrastructure.”

In some cases, it may retain ownership of infrastructure, but its preference is for an arm’s length relationship, in which it provides seed money and other assistance, and private companies carry the ball from there. It has worked before in Singapore, so there’s no reason to think it can’t work again.