The Infocomm Development Authority of Singapore (IDA) will lift SingTel's Dominant Licensee obligations1 in wholesale international telephone services (ITS). This is part of IDA's decision on SingTel's request2 to be exempted from Dominant Licensee obligations in the ITS market...
Singapore, 12 November 2003 | For Immediate Release
The Infocomm Development Authority of Singapore (IDA) will lift SingTel's Dominant Licensee obligations1 in wholesale international telephone services (ITS). This is part of IDA's decision on SingTel's request2 to be exempted from Dominant Licensee obligations in the ITS market.
IDA's decision was arrived at after a careful review of the state of competition in the ITS market segments. Industry feedback3 was also considered. IDA notes that the wholesale ITS market4 is fully competitive. There are at least 5 major players providing effective competition, and SingTel's share in the wholesale ITS market is around 30%. As such, IDA's view is that regulation is no longer necessary to preserve fair and effective competition amongst licensees in this market segment.
IDA will also remove the requirement for SingTel to seek prior approval for retail ITS prices, since retail ITS markets4 are substantially competitive. This allows SingTel the flexibility to react promptly and effectively to changing market conditions, which will further increase market competition to the benefit of consumers and businesses. Since market liberalisation in April 2000, retail ITS prices have fallen substantially and there are over 50 operators providing retail ITS. IDD rates have fallen by up to 60%. Prices of international telephone call services such as VoIP and callback services have dropped by as much as 80%.
However, SingTel continues to be required to observe safeguards for fair competition, in the retail ITS markets. These safeguards include requirements to provide unbundled telecom services, where the services, prices, terms and conditions should be provided on a just, reasonable and non-discriminatory basis. This is because, unlike other retail ITS providers, SingTel is a dominant provider in some upstream inputs and retail services, such as access to cable landing stations and the direct exchange line (DEL) service.
IDA's decision is in line with its regulatory approach to enhance competition in a healthy and sustainable telecom market to bring benefits to consumers and businesses. In market segments where there is effective competition, IDA will scale back its regulation. In segments that are not effectively competitive, IDA will continue to monitor developments and maintain regulatory oversight.
Details of IDA's decision can be found in its explanatory memo at https://www.imda.gov.sg/, under the sections "Policy & Regulation", "Information Papers".
ISSUED BY CORPORATE COMMUNICATION DIVISION
INFOCOMM DEVELOPMENT AUTHORITY OF SINGAPORE
Notes to Editor:
1 SingTel requested IDA for dominant licensee exemptions in the ITS market, such as tariff filing requirements and safeguards for fair competition. The safeguards include the duty to provide service on demand at just, reasonable and non-discriminatory terms and conditions; to provide unbundled telecom services; and duty to allow resale of end-user telecom services, etc. Please refer Table 1 in the appended fact sheet (47.00KB) for details.
A Licensee will be classified as dominant if it controls facilities that provide a direct connection to end users within Singapore, regardless of the technology used, and: (a) the facilities are sufficiently costly or difficult to replicate, such that it would create a significant market entry barrier to competitors; or (b) the Licensee has the ability to restrict output or to raise prices above competitive levels, over such facilities, for telecom services provided by end-users.
2 SingTel's request for exemption is in accordance with Section 2.6.1 of the Code of Practice For Competition in the Provision of Telecommunication Services (the 'Code'). A Dominant Licensee may submit an application to IDA, identifying the specific provisions of the Code that it wishes to be exempted from. The Dominant Licensee must provide verifiable data to support its request.
3 IDA conducted a public consultation exercise on 10 April 2003 to gather industry feedback and comments on SingTel's request for exemption from its Dominant Licensee obligations in ITS. The public consultation was closed on 8 May 2003. Please refer Table 2 in the appended fact sheet (47.00KB) for a tabular summary of IDA's decision.
4 IDA assessed SingTel's request for exemption from Dominant Licensee obligations for ITS according to three market segments: residential retail ITS market, commercial retail ITS market and wholesale ITS market. Please refer Table 3 in the appended fact sheet (47.00KB) for details on SingTel's ITS products according to these market segments.
About Infocomm Development Authority of Singapore
The Infocomm Development Authority of Singapore (IDA) develops, promotes and regulates info-communications in Singapore, with the aim of establishing Singapore as one of the world's premier infocomm capitals. To nurture an internationally competitive infocomm industry, IDA offers a comprehensive range of programmes and schemes for both local and international companies. For more information, visit https://www.imda.gov.sg/
For media clarification, please contact:
Ms Cindy Kong
Manager, Corporate Communication
Infocomm Development Authority of Singapore
Tel: (65) 6211 1997
Fax: (65) 6211 2227