Digital trade route hangs on SingTel co-operation

The only thing preventing a digital trade route between New Zealand and Singapore is Singapore Telecommunications Ltd. (SingTel), which controls the city-state’s telecommunications last mile.

But don’t worry, we’re working on that, says Tone Borren, who besides being the chief executive of the next generation Internet (NGI) consortium and directing Wellington Web design firm Shift, is working on a New Zealand-to-Singapore digital trade route project.

He is performing the latter role as part of First Light, a consortium set up last year, one of whose partners is Wellington metro Ethernet provider CityLink.

Borren says it’s CityLink’s uniqueness that allowed the idea of a direct New Zealand-to-Singapore link — a “digital trade route” — as opposed to the present data routing regime, whereby data sent to Singapore from New Zealand goes via Europe or the U.S.

“CityLink is unique in supplying a public LAN service in a city.

“A public LAN service looks at interconnecting LANs and that’s fundamentally different from the idea of telcos supplying leased line data services.”

Under the potential digital trade route, “every LAN will be able to dial an IP address and connect to the service.”

First Light has agreed to partner with OneNet, the managing body of Singapore’s government-owned broadband core network, “to provide a CityLink-type service for LANs in Wellington and Singapore to interconnect.”

The network will run at a minimum of 100Mbps and often at 1Gbps, Borren says, and unlike the traditional telco data model, “we’re not leasing it continually; it’ll be pay per burst, also known as bandwidth on demand.”

The one remaining obstacle is the last mile in Singapore.

“We can connect all the way to Singapore and all the way across Singapore, but the last mile is in SingTel’s hands. It runs over big pipes that are artificially constrained by SingTel’s product and service definitions.”

While SingTel is “more interested in leased data pipes” than the international LAN-to-LAN model, First Light is discussing that with the company, Borren says.

He is unaware of any international precedents for what First Light is attempting to do.

“No one has broken the paradigm as CityLink has.”

The project is economically viable, he says, and Wellington businesses were surveyed last year as part of First Light’s business plan.

“There are huge opportunities for elasticity. When (voice call) prices went down 10 to 12 years ago, call numbers went up; that’s elasticity and that’s what will drive us.”

If telcos would aggregate data as they do voice, data prices would come down and still provide profits, he says.

First Light received funding from the government last year but is mainly privately funded, Borren says.

He says Singapore is a very suitable candidate for a digital trade route “as we have a close economic partnership and they have a local-national broadband network.”

If the New Zealand-Singapore route is established, it would open up the possibility of others, he says