"Content Is King But Distribution Is the Power Behind the Throne"

Mr Khoong Hock Yun, Assistant Chief Executive, Industry Infocomm Development Authority of Singapore Keynote Speech - 3GSM World Congress Asia, Suntec International Convention & Exhibition Centre

Mr Khoong Hock Yun, Assistant Chief Executive, Industry
Infocomm Development Authority of Singapore
Keynote Speech - 3GSM World Congress Asia, Suntec International Convention & Exhibition Centre
Singapore, 29 September 2004

Mr Marcel Fenez, Chairman, The Cable & Satellite Broadcasting Association of Asia (CASBAA) & Asia Pacific Leader, Entertainment & Media Practice, PricewaterhouseCoopers,
Mr Craig Ehrlich, Chairman of the Board, GSM Association,
Ladies and gentlemen.
A very good morning.

Is Content King?

1. During the internet boom days, Mr Sumner Redstone, CEO of Viacom, said that "Content is king". Proponents believe that, without content, internet and mobile phone companies risk becoming simple commodity pipelines.

2. Critics to this assertion counter that communication channels attract much more spending than the glamorous "content" itself. Even on the Internet, which is widely regarded as primarily a content delivery system, content is not necessarily as important as is often claimed, since it is email, a delivery-based application, which is the true "killer app". According to this school of thought, what content lacks is probably the ability to generate substantial profits. For instance, the annual domestic movie ticket sales in the U.S. are close to US$10 billion¹ but the telecommunications industry generates that much money in just 2 weeks!

3. But the value of a good yarn cannot be under-estimated, be it during the times of the itinerant village story-teller or in a digital animation story like "Finding Nemo". As a key enabler, technological changes in content creation, distribution and consumption, can fundamentally re-shape the content industry. New players have come in as king-makers, essentially being the power behind the throne.

4. In this day and age, separating content from technology is probably irrelevant. The blurring in content and delivery is fast becoming a reality in today's context, with mass digitisation of content and information, spurred by the widespread development of the Internet. There is little meaning in having the best content if you are not hooked to a reliable information network.

Singapore: Asia's Digital Exchange Hub

5. As such, the Infocomm Development Authority of Singapore (IDA) is developing Singapore as a trusted hub for content management and distribution through our Digital Exchange initiative. With our high level of connectivity² to Asia and rest of the world, excellent telecoms infrastructure, high standards of intellectual property rights protection and legal enforcements, and a technology-savvy population, Singapore is well-positioned to be Asia's hub for digital management, distribution and delivery of digital assets and services.

6. With our roots as a logistics hub and established regional network, Singapore has developed its infrastructure to become the business hub to host regional online games and game services. One such initiative of the Digital Exchange is the Games Bazaar. Initiated by IDA and supported by SingTel and Hewlett-Packard, it establishes a friendly environment for worldwide online game owners to test-bed their offerings in the Asian market. It serves as a "living laboratory" by providing the basic requirements of hosting, servers, and bandwidth at a subsidised cost during the intense and critical initial deployment and beta testing phase of any online game.

7. As Asia's Digital Exchange hub, we are well-plugged into the digital cinema scene, having the world's first digital cinema multiplex. With 21 digital cinema screens, Eng Wah Organisation has screened 6 Hollywood and Hong Kong movies since November last year. Digital cinema has also provided movie audiences with a wider variety of content offerings, such as digitally transmitting live events like our recent National Day Parade, and concerts such as the David Bowie concert held last year.

8. Moving forward, the next lap of the information evolution will steer the industry toward content and technology convergence. This will be achieved in an environment of higher bandwidth, more powerful devices, next generation technologies and always-on networks. Providing a multi-modal user experience over a broad offering of devices, communications, networks and services according to changes in context and user preferences will thus, take centre stage.

9. The introduction of wireless multi-player platforms and multi-function devices like Nokia's N-gage is a testament to such a trend. It is forecasted that by 2008, mobile entertainment services will generate over US$27 billion³ and have over 2.5 billion users. In particular, mobile gaming is expected to play a key role in driving the growth of mobile content and entertainment services⁴. And the Asian market is the one with the highest growth potential, with downloadable games producing as much as US$2.1 billion in 2003⁵. The region hosts some 70 million mobile gamers, with subscription model, followed by pay-per-play as the two most popular revenue models. Another mobile entertainment service with strong growth potential is music applications which generated almost US$4 billion in 2003, and this figure is set to increase by 75% by 2008.

The Power Behind the Throne

10. Effective content delivery can only be achieved if it reaches the increasingly elusive customers by providing the right content at the right time. Consumer choice will become the driving force in content delivery. As a key communication tool, the mobile phone will be an important delivery medium for anytime, anywhere access to information and content. Its potential is immense in view of its capabilities to support video telephony, video streaming, multi-media messaging and downloadable applications. On a broader note, the advance of 3G and other emerging wireless technologies will also stimulate the creation of new content and services.

Gearing Up for 3G

11. With the imminent 3G rollout by end of the year, IDA recently issued the measurement criteria for the nationwide rollout of 3G systems and services for our telecom operators. Similar to the current measurement of outdoor radio coverage for 2G services, the measurement service outcome allows users in 95% of Singapore to obtain a signal on their 3G phones for voice and data services. At the same time, the measurement criteria allow operators the flexibility to plan future 3G enhancements, and time to make technical network adjustments for a new service. This move will help to foster the growth of 3G developments to the benefit of consumers in Singapore. Last Friday, SingTel announced the launch of their 3G customer trial to solicit feedback on ways to improve their 3G service offering ahead of the its commercial launch. Trial customers will experience seamless 2G/3G handover when they move to places without 3G coverage, and enjoy video communications across multiple platforms: mobile, fixed line and Internet.

A Hotzone of Wi-Fi Hotspots

12. The introduction of nationwide 3G will also complement our existing public wireless LAN coverage. To date, we have about 600 public WLAN hotspots deployment in cafes, libraries and fast food outlets nationwide, or approximately one Wi-Fi hotspot located within every square kilometre of land. Specifically within the Central Business District (CBD), we have more than 33 hotspots per square kilometre or 1 hotspot every 100 metres⁶, making Singapore the nation with probably the highest hotspot density in the world.

13. Moving forward, we will work with the industry to further expand our Wi-Fi footprint islandwide to 3 hotspots per square kilometre by 2007.

14. To ensure seamless connectivity and roaming for users, IDA has been working with partners towards one-bill roaming to achieve integration and interoperability between different technologies and networks. Through the deployment of WLAN, fixed and cellular interworking solutions with common technology standards, we believe we can bring about a truly connected nation for wireless innovations.

15. Kick-starting efforts to enable a standardised architecture for seamless wireless roaming, the IDA-Intel Wireless Interworking Initiative has successfully completed the validation of the Public Wireless LAN Interworking Architecture with 14 participating operators and technology providers. My colleague will share the results of the validation tests and interworking study during his presentation later today. You will also be able to view the interoperable networks and roaming architecture which are on showcase at IDA's exhibition booth.

A Living Lab of Wireless Innovations

16. In addition, IDA is facilitating the introduction of wireless broadband technology by freeing up spectrum in the 2.5 GHz and 2.3 GHz bands for wireless broadband deployments and commercial trials. By enabling a complementary set of wireless broadband networks, we hope to provide consumers and enterprises with higher speed data access options, more innovative content and applications, and competitive broadband pricing.

17. Two months ago, IDA announced the Market Trial Licence Framework that allows companies to trial the commercial potential of their new services and test out new business models and technologies. I would like to take this opportunity to invite interested operators to test the Singapore market for wireless broadband using the framework. By the end of the year, we will finalise the policy recommendations and release details on the allocation of wireless broadband spectrum. We will also finalise our decision on the use of the allocated 3G bands for wireless broadband by then.

Conclusion

18. In conclusion, we look forward to working with you to test your content and applications in Singapore. We hope to work with you to chart the future of content and technology convergence through multi-platform channels. The day will arrive when consumers are able to access on any device the same things they get from anywhere else, customised to their preferences and geared to their locations.

19. To this end, IDA endeavours to support Singapore's content distribution and digital exchange strategy and increase our international competitiveness as a trusted hub for wireless innovations.

20. If content is king, distribution is the power behind the throne. As a digital exchange hub, Singapore is powered to be Asia's distribution node for content and digital assets.

21. With this, I thank you for being a wonderful audience and wish you a fruitful conference ahead!

Notes:

¹ Source: "Content is not king" by Andrew Odlyzko, 29 January 2001

² Over 21 Tbps submarine cable capacity

³ Source: ARC Group, Oct 2003

⁴ According to Mobile Entertainment Forum Chairman, mobile games are currently taking a very strong second place behind ring tones downloads in terms of operator-portal traffic in many territories.

⁵ Source: Datamonitor and Strategy Analytics, Jan 2003

⁶ Based on total CBD area of 6.5 square kilometres, 200 hotspots within the CBD and that each hotspot has a 100m radius coverage.