SIN Telco - NGNBN Request-for-Proposal: “Free call option” for incumbents The IDA has launched the Request-For-Proposal for Singapore’s Next Generation National Broadband Network (NGNBN). This is for the NetCo which will design, build and operate the passive infrastructure.
The Request-for-Proposal submission is due in Mar 08 and the sole winner will be announced in 3Q08. As expected, the NGNBN industry structure and key bidding parameters will not create disruptive outcomes for the incumbents.
In our view, SingTel and StarHub have effectively received a “free call option” to participate in the NGNBN. SingTel and StarHub face little downside risk from not participating or failing to win bids for the NetCo or OpCo.
We believe that the NGNBN update is neutral at worst for the three Singapore telcos and should be a positive catalyst for SingTel and StarHub.
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