S'pore NBN services should target SMBs

Retail service providers (RSPs) of Singapore's next-generation national broadband network (NBN) should provide services tailored for small and midsize businesses (SMBs) in order to gain a competitive edge, recommends an industry analyst.

In an e-mail interview with ZDNet Asia, Vu-Thanh Nguyen, research analyst at AMI-Partners Asia Pacific, noted that most network operators have realized it is difficult to differentiate themselves in the market if they only sell network connectivity. They are keen to move beyond the traditional role of providing connectivity to include other services, he added.

Nguyen said SMBs in Singapore are increasingly adopting technology to drive efficiency and productivity but face the challenge of coping with rapidly-changing technologies. Smaller companies also find it tough dealing with high up-front capital investment and the complexity in managing ICT systems, he said.

Thus, the analyst said both SMBs and RSPs will benefit if the service providers play a larger role in putting together service packages that address SMBs' needs.

To appeal to these smaller businesses, NBN service providers should offer advanced services in addition to basic services such as hosted network firewall and intrusion detection, hosted e-mail and Web hosting, Nguyen suggested.

He pointed to the 2010 Pacnet Broadband Barometer study which revealed that about one-third of SMBs with 5 to 999 employees had plans to adopt hosted business applications, online data backup and archival, and hosted application firewall next year. RSPs should then target these advanced services, he said.

The NBN service providers are indeed looking to put extras into their fiber broadband plans.

LGA Telecom's chief executive, Daniel Ang, told ZDNet Asia the company is bundling business collaborative tools with its 100Mbps fiber plan.

At Singapore Telecommunications (SingTel), SMB customers are offered a 100Mbps business fiber broadband plan that includes an office collaboration platform called OneOffice, and one of five value added services.

StarHub's enterprise fiber package includes a choice of a free network camera or network storage, as well as mobile services. M1's 100Mbps Internet plan promises free 15GB of Web and e-mail hosting services, which include antispam and antivirus as well as a choice of mobile phone or mobile broadband service.

SMBs still prefer to wait-and-see
Despite the RSPs' efforts to pull in SMB customers, it will take some time before these businesses take the bait.

Nguyen noted that the adoption of fiber services will likely progress in phases in the SMB sector due to various reasons, one of which is that the full deployment of Singapore's NBN is not expected to be complete until 2012.

In addition, the analyst said SMBs want to wait and learn from early adopters and give RSPs time to ensure their fiber network connection is smooth before signing up for any NBN services.

John Eng, Parallels' Asia-Pacific and Japan vice president of marketing for cloud and service providers, concurred. The virtualization and automation software vendor said its partners, which include independent software vendors (ISVs), Web hosting companies and Web service providers, are close to NGN ready but are seeing see SMBs adopting a wait-and-see approach to NBN.

Eng added that pricing is also a deterrent for SMBs, where many perceive the price for fiber connection to be too high at this stage. They also see no immediate need or critical business pain-points to push them to move to NBN, he added.

However, Parallels believes charges for NBN services will decrease as such offerings gain traction and reach critical mass, making it more affordable for SMBs.

And the promise of high-speed connection may very well prove a strong selling point.

U.S.-headquartered network company, Ciena, which works with Fortune 500 companies, said the availability of fiber will allow connections over a wide area to be as fast as those over local area network (LAN).

In an e-mail interview, Stephen Alexander, Ciena's senior vice president of products and technology and CTO, said for businesses, said fiber networks can "support theoretically virtually limitless transmission speeds and capacity" of up to 100Gbps. In comparison, traditional copper networks and hybrid fiber-coaxial (HFC), which combines optical fiber and coaxial cable, are limited to less than 1Gbps due to existing transmission technologies, he said.

According to Alexander, fiber networks will enable applications such as high-speed site-to-site connectivity, storage area networks over dispersed sites, and real time theater-quality video distribution to cinema, and support the full realization of cloud-based services and applications.

LGA Telecom's Ang believes NBN will drive the adoption of telecommuting, already popular in Western countries, in Singapore because organizations will be able to save on office rental, time and transportation costs.

He noted that with NBN, employees working from home can access files as fast as they are able to on their corporate LAN and be able to smoothly conduct face-to-face communication via teleconferencing.

Immersive teleconferencing will benefit consumers, added Ciena's Alexander. Other consumer-related services that will benefit from fiber include higher speed Internet connectivity, high-definition IPTV (Internet Protocol TV) delivery, virtual classrooms as well as telemedicine, he noted.

There will also be "fundamental changes" in consumer behaviors, he said. He explained that because high-speed connection allows users to access the Internet and receive applications and information near-instantaneously, the need for power computers with large hard disks will become less important.