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Statement By 2nd Minister At COS Debate 2007

3 March 2007 - Statement in Parliament By Dr Vivian Balakrishnan, The Second Minister For Information, Communications And The Arts During COS Debate (MICA).

Statement In Parliament By Dr Vivian Balakrishnan, The Second Minister For Information, Communications And The Arts During COS Debate (MICA) on 3 March 2007.

Infocomm Sector

1. Mr Chairman, Sir, I thank the Hon. Members for their comments and queries on MICA’s plans for infocomm and for IDM. I will first address the questions related to infocomm.

2. The Intelligent Nation 2015 infocomm masterplan was launched by IDA in June last year after extensive consultation. We intend to invest $4 billion into this sector. Over the next 10 years, iN2015 will transform the way we live, work, play, and learn.

Infocomm Infrastructure

3. Ms. Penny Low asked about the state of our infocomm infrastructure relative to other countries. Singapore has a pervasive broadband infrastructure today, thanks to the foundation laid more than ten years ago. In terms of household broadband penetration, we are now close to 63 percent, and want to reach 75 percent by year-end. By 2015, we want to raise this to 90 percent. Our foresight and willingness to invest back then had put us in the lead in the development of a knowledge economy. However, this is a dynamic and moving situation. We are aware of developments in countries such as Seoul , Tokyo , Hong Kong , Shanghai , and Hangzhou . They have already implemented ambitious, ultra high-speed next generation broadband networks. Therefore we cannot afford to stand still.

4. Pervasive high-speed networks are no longer a luxury, but an essential infrastructure for our next phase of economic development. Against this backdrop of keen competition, we have to plan for the future. We must prepare the infrastructure for future needs, and will do so in a cost-effective and efficient way.

5. We have already started. For example, in December 2006, we launched the first component of the Next Generation National Infocomm Infrastructure or NGNII. This is the nationwide Wireless Broadband Network called Wireless@SG. With this wireless infrastructure, we have free access to some 1,300 hotspots found across Singapore today. The number of hotspots will reach 5,000 by September 2007. Wireless@SG not only benefits individuals - it will also enable businesses, especially local SMEs, to provide new services on this platform. Many of you will recall the Straits Times story of how a Bak Kua retailer in Chinatown leveraged on Wireless@SG and used wireless point-of-sale terminals to serve festive shoppers on five-foot-ways during the Chinese New Year.

6. Complementing Wireless@SG is the next enhancement of the wired component of the NGNII, the Next Generation National Broadband Network, or NBN. We envisage that the NBN will be capable of offering ultra-high speeds of 1 Gbps or more, and aims to provide affordable broadband for 95 percent of all homes and businesses that subscribe to it by 2012. An open access architecture will ensure competitiveness in our infocomm sector as it will keep prices low and affordable, which in turn will determine the up-take rates. This will lead to the development of diverse, new services for businesses and individuals. We conducted a Request-For-Concept exercise last year that drew 33 responses. Later today, IDA will announce the shortlist of pre-qualified applicants to participate in the upcoming Competitive Dialogue on the project.

Inclusive, User-Friendly Platforms for Interaction 

7. Beyond the “hard” infrastructure, we also need to create integrated, user-friendly services and develop platforms for the people, private and public sectors to interact and transact on a day-to-day basis - that’s where value gets created.

8. The government has taken the lead on this. The Mobile Government initiatives are a good example of how this can be done. We have already transferred e-Government initiatives onto these mobile platforms. Citizens and businesses already have mobile access to about 150 government services. By 2008, Singaporeans can look forward to at least 300 mobile government services including finding events held by government agencies, paying taxes and fines, and application for exit permits for NS men.

9. The government also sets standards and develops platforms in order to develop IP, and benefit businesses and people. For its mobile initiatives, the Government out-sources and these create business potential for SMEs.

10. As infocomm becomes increasingly indispensable, it is important to build an inclusive digital society where no one gets left behind. The government will be focusing on hardware, connectivity, education and opportunities. Needy students should be able to obtain computer and internet access; people with disabilities should be able to receive infocomm training to improve employability; and the less tech-savvy, including the elderly, should be able to get connected effortlessly in the Digital Age.

11. The IDA’s NEU PC scheme subsidised computer ownership for close to 1,900 low-income households between April and December last year. More recently, the enhanced NEU PC Plus programme was launched in November 2006 to also provide subsidised broadband access to some 10,000 needy households focusing on those with school-going children. We recognise that broadband access is now considered essential for education and not a luxury. For a start, 888 families will be receiving their PCs by this April. By 2015, our goal is to see 100 percent computer ownership and broadband access for all homes with school-going children.

12. For those who are less IT-savvy, or do not have internet access at home, CitizenConnect Centres, that are conveniently located where residents live or work, will facilitate online interaction between the government and citizens. At these kiosks, the elderly are given help and educated on how to use the Internet to transact with the Government. Today, more than 36,000 residents have benefited from this programme.

Promoting the Development of SMEs 

13. I would like to turn to the questions regarding SMEs. Both Ms Penny Low and Mr Zaqy Mohamad have stressed the importance of promoting the development of SMEs in the infocomm sector. Let me assure the House that we give equal opportunities for all suppliers and local SMEs are given a fair shot at winning Government contracts in open competition. The statistics show this. In FY2005, 116 of 196 contracts were awarded to local SMEs for Government ICT tenders of value lower than half a million dollars. Local SMEs are well capable of competing and winning contracts.

14. Since 1 July 2004 , the Government has also taken the position that the Intellectual Property (IP) developed by SMEs through any outsourced government ICT contract would belong to the contractor, unless there are strategic reasons for Government to retain that IP. The reason is because the Government would like SMEs to develop applications and then take their products to market - both locally and internationally. IDA and the Singapore Infocomm Technology Federation (SiTF) are still engaged in discussions on how contract terms and conditions can be further improved.

15. The Singapore market is too small. We want our SMEs to grow to compete globally, so it is more critical to help them develop their capabilities to allow them to stand on their own in other countries. In January 2007, the infocomm Enterprise Programme (iEP) was launched to encourage smaller companies to develop reference sites and build their IP while developing their capabilities to implement and deliver large-scale, sector-wide projects.

16. IDA also has programmes, such as the Overseas Development Programme and infocomm Local Industry Upgrading Programme (iLIUP), that facilitate partnerships between MNCs and our infocomm local enterprises and help them acquire technology to gain access to markets as well as a track record. Our local enterprises have had great success. For example, under IDA’s iLIUP programme, home-grown company Friartuck partnered with Fujitsu to successfully out-compete international players to snag a significant deal with NUH. Since 2002, iLIUP has helped to develop more than 400 products or solutions and train more than 1,000 IT professionals.

Infocomm Manpower and Talent Development

17. All these developments will translate into greater job opportunities for Singaporeans. Our pool of infocomm professionals stood at 111,400 in 2005, and our target is to create 80,000 additional jobs by 2015. Overall, we hope to create 200,000 infocomm professionals who are globally competitive and able to secure good jobs.

18. IDA’s Critical Infocomm Technology Resource Programme (CITREP) has successfully allowed local infocomm professionals to obtain financial assistance to acquire new infocomm skills that are in demand. Since then, CITREP has committed $53 million since 1996 to fund 35,000 training places.

19. The infocomm industry is a fast-moving field. The Government hopes that IT professionals take charge of its own professional upgrading. A National Infocomm Competency Framework (NICF) is being developed in partnership with WDA and industry players to empower and encourage our infocomm professionals to upgrade their capabilities in line with industry needs. This framework will be launched in mid-2007. A National Infocomm Competency Academy (NICA) will also be established with a consortium of Institutes of Higher Learning (IHLs) to ensure the availability of quality NICF-aligned courses.

20. Singapore must also invest in the youth. Last year, MICA unveiled a $120 million Infocomm Manpower Development Roadmap with a particular emphasis on Student Outreach, to develop infocomm appreciation and encourage innovation and capabilities from young. Since then, more than 110 Infocomm Clubs have been established in Primary and Secondary schools, with more than 5,000 students enrolled as members.

21. We have also expanded the National Infocomm Scholarship. It is now supported by 20 leading employers who offer the scholars global industrial attachment opportunities as well as taking them on as employees subsequent to their attachments.

22. Singapore ’s Institutes of Higher Learning (IHLs) must continue to attract their fair share of the brightest students for their infocomm courses. In 2006, integrated Masters programmes were launched, featuring tie-ups between local universities and reputable foreign ones, such as Carnegie Mellon University and Georgia Institute of Technology.

iN2015 Already Sees Results - Increased ICT Buzz and Usage

23. Let me sum up some encouraging results of iN2015 so far. Since its launch, the masterplan has been attracting global attention, particularly from top global infocomm giants. We have made local headlines recently. John Thompson, Michael Dell, John Chambers, to name a few, have come to Singapore to look for opportunities. MNCs like Credit Suisse and DaimlerChrysler, have also moved their IT nerve centres to Singapore . This is because of our first world infrastructure, stable government and stable IP regime.

24. There is buzz and more opportunities in the infocomm scene which in turn benefit the man in the street. Broadband prices have fallen by as much as 37 per cent in 2006, and speeds have reached as high as 100 Mbps.

25. The significant drop in prices of infocomm services has fuelled adoption of services and 3G subscriptions have increased from 174,800 in December 2005, to close to 884,000 in December 2006, and now comprise about 19 per cent of the mobile subscriber base. Three out of four households have access to at least one computer at home, and it has become a norm for youths to use the internet and its connectivity for activities such as communicating, gaming, information gathering and interaction.

26. Moving onto the questions on Interactive and Digital Media, or IDM. Mr Zainudin Nordin and Dr Fatimah Lateef asked for an update on the S$500 million allocated by the National Research Foundation for IDM R&D over the next five years. This funding is intended to increase Singapore’s R&D capacity and help develop breakthrough technologies and products in Singapore and beyond in order to make Singapore more competitive. We intend to increase the value-added contributions of the IDM sector to $10 billion, up from $3.8 billion in 2003, and to create 10,000 new jobs by 2015.

27. To spearhead our efforts, a multi-agency IDM Programme Office was set up in August last year. We will be focusing our efforts on four core areas of research: Animation, Games and Effects; Media Intermediary Services; ‘On the Move’ services; and IDM in Education Services. How will we make progress in these four areas?

28. Firstly, we aim to build a global network of research institutions, both local and overseas, and boost Singapore ’s IDM R&D capabilities. Already, we have seen some results. Last October, MDA and Massachusetts Institute of Technology announced the Singapore-MIT International Game Lab to further global research and develop world-class academic programmes in games technology. This is a huge growth area as the market potential for games has been predicted to exceed that of Hollywood blockbusters.

29. The second initiative is an online platform called i.JAM, for people from both research and industry sectors can come together, exchange breakthrough ideas and look for opportunities. We hope to promote useful engagement and dialogue between experts, venture capitalists, the Government and potential users.

30. The third initiative is to position Singapore as a preferred location to test-bed innovative and commercially-viable IDM R&D applications. Although Singapore may be a small market, we could still function as a reference market as R&D applicability in Singapore would mean applicability in other countries as well.

31. The fourth initiative is to encourage investments by key industry players in the development of new open access platforms, which will in turn stimulate the development of applications, products and services.

32. These initiatives have received tremendous support. So far, over 30 IDM stakeholders and partners have come on board. Our educational institutions have also ramped up their IDM R&D efforts, while local research institutes have offered a slew of technologies for further development.

33. We have not spent our $500 million IDM budget. We would like to ask Members to watch this space and we would provide a further update next year.