Singapore is installing fiber to every building

This figure is taken from a an ITU study on the Internet in Singapore that I worked on several years ago. It depicts the government role as an equity investor in the ISP industry. (The government has played a similar role in the oil, finance, shipping and biotechnology industries).


Continuing that policy, the government of Singapore is investing in fiber to every home, school, government building, business and hospital. Their Next Generation Plan is for 95 percent of buildings to have access to a 1 Gbps connection by 2012.

They will also follow the model of competitors using open, shared infrastructure, which seems to be working well in Stockholm and other cities.

There are caveats. Singapore is a small, city nation, and a very high percent of the population lives in apartment buildings. That makes this plan relatively cheap. Retail connectivity prices are also a question mark -- will there be sufficient competition over the shared infrastructure to keep them low?

If the network succeeds, and 1 Gbps connectivity becomes ubiquitous, what applications might they develop? What would you use a 1 Gbps link for?

Swedish report calls for openness and competition at all network levels

The Swedish Telecoms Regulator has issued a 150 page report (in Swedish) on open networks and services with a two page abstract in English.

The report focuses on the importance of open, competitive markets and networks at five levels:

1. Natural resources (use of and access to land, ducts and spectrum)
2. Infrastructure (passive cables and masts)
3. Transmission (equipment for transportation of bit-streams)
4. IP/Internet (equipment for traffic direction and IP addressing)
5. Content and services (content, services and end user equipment)

This multi-level approach sounds like that presented by Brough Turner, and it has worked well in Stockholm and throughout Sweden, as shown by their high rank on Internet-related indices:

Index	Rater	Rank
Broadband Performance Index	European Community Commission	1
E-readiness rankings	Economist Intelligence Unit	2
Networked Readiness Index	World Economic Forum	2
Broadband Quality Score	Said Business School	4

Why is connectivty in Stockholm so much faster and cheaper than in US cities?

We've been discussing US broadband policy and the stimulus package, and this table shows the cost of fiber-based, residential Internet service in several cities (Brough Turner provided the European and Asian data):

Where?	Monthly cost	Uplink (Mbps)	Downlink (Mbps)
Stockholm	$11	100	100
Seoul	$24	100	100
Hong Kong	$35	100	100
Tokyo	$61	100	100
Amsterdam	$127	100	100
Lafayette, LA, Municipal	$58	50	50
Lafayette, LA, Cox Cable	$140	5	50
US, where available, Verizon	$145	20	50

Can we explain the large speed and cost differences?

The Cox Cable offering in Lafayette, Louisiana seems to be the worst deal. It is the slowest and only five dollars a month less than the Verizon network. The municipal network in the same city is faster and cheaper. The Cox network reaches more neighborhoods than the municipal network, and they are forced to compete with temporary sale prices.

Stockholm is at the other extreme. They have a municipal network that reaches every block in the city. Unlike Lafayette, they do not offer consumer service over their fiber, but lease network access to anyone who would like to offer service. The Internet service providers, including incumbent telephone and cable companies, compete on an equal footing.

As a result, there are many competing service providers in Stockholm, and, as Turner points out, the city owns the expensive, long-life assets like fiber, rights of way, conduit, and tunnels, and the service providers own the electronic equipment that is relatively cheap and is upgraded frequently as technology improves.

Many factors determine the cost of Internet connectivity, but the ownership model is significant, and it seems the Stockholm model is superior to those in the US.

Note that analysts at the OECD also endorse the Stockholm ownership model, writing that:

Municipal networks can play an important role in enhancing competition in fibre networks. If these develop, governments should encourage them to be open networks, that is providing dark fibre to service providers rather than becoming themselves service providers. Nor should the existence of a municipal network providing dark fibre mean that investment in other fibre networks in that municipality should be prevented.

Should some of our broadband stimulus funds be used for Stockholm-style municipal networks?

Click here for a paper with more on this topic.

Click here for a PowerPoint presentation on this topic.

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Update 11/10/2014

Stockholm reports 19 years of financial and user success. The Stokab report should be required reading for all local government officials.