In order to accommodate the rapid growth in the ICT sector in both the public and private spheres, the capabilities of Brunei Darussalam’s telecoms infrastructure are being bolstered in anticipation of even greater amounts of data traffic in the years to come. While so far the country’s fixed and mobile internet network has been able to accommodate the increasing data flows, a number of factors are contributing to the need for updated technology.
A major push within the government to encourage the adoption of electronic services for intra-government operations, as well as citizen and business services, is driving demand on the public side, while increased uptake of ICT technology and growing use of high-bandwidth applications are contributing in the private sector. As antiquated hardware such as telephone lines, copper wire and mobile 3G face capacity constraints, the next generation of technology is being rolled out.
Hardwired
With more than enough overseas capacity already available through subsea cables and a fibre-optic backbone in place, the last step in a seamless next-generation network is the implementation of fibre-to-the-home (FTTH), providing near universal high-speed broadband (HSBB) connectivity. Initiated in 2011 by the state-owned Telekom Brunei (TelBru), the FTTH programme will replace existing copper wire with fibre-optic cables that are able to support much higher data transfer rates of up to 100 Mbps, as well as increased stability and consistency in service. Earlier generation technology such as ADSL is generally capable of a fraction of this speed, maxing out at 8 Mbps.
While the initial outlay for the programme is significant – the government allocated the project BN$230m ($180.48m) under the 10th National Development Programme 2012-17 – higher long-term maintenance costs associated with aging copper infrastructure should help offset some of the investments. Chinese telecoms giant Huawei was also hired by TelBru in 2010 to bring its considerable experience and know-how to bear on the roll-out.
The ambitious project is being implemented in three phases, the first of which covers the major urban centres of Madang, Gadong and Bandar Seri Begawan. Some 12,000 homes from a total 31,000 targeted in the initial phase had been wired with fibre as of November 2013, according to TelBru. The second phase of the plan is projected to add another 14,000 connections across the areas of Bengkurong, Sengkurong, Rimba, the stretch along Jalan Muara, Mentiri, as well as a large portion of Kuala Belait and Seria. In all, the Ministry of Communications announced in February 2014 its intention to connect 80% of homes to HSBB by the end of 2014. Looking further out, TelBru has indicated that it expects to connect 45,000 homes with fibre by the end of 2016, which would amount to the completion of the first two phases of the programme and leave only smaller, more remote populations unconnected.
Increased Capacity
Expanding FTTH will not only help businesses to carry out their current online transactions and applications more efficiently, but it will also open the door for newer, higher-capacity services. These include pay-TV, which would have the bandwidth capacity to offer video content in the form of internet protocol television or on-demand streaming services, allowing it to compete with cable and satellite providers. Other potential applications that could gain popularity with the availability of HSBB include online shopping and bill payments, as well as e-education and e-health.
Due in large part to the initial progress made in the FTTH programme, the number of fixed broadband subscribers spiked 34.18% from 2012 to 2013 as wired households increased from 17,768 to 23,841 during that year, according to the Authority for Info-communications Technology Industry of Brunei Darussalam (AITI). At the same time, the number of traditional dial-up users continues to fall, declining from 8643 in 2006, accounting for 45.24% of all internet subscribers, to just 1644 connections by 2013, representing 3.12% of the online public.
Going Mobile
Running in tandem with the roll-out of fibre-optic cable across the country, telecoms operator DST has also worked to provide high-speed internet access through its mobile network. Already offering 2G and 3G services and mobile broadband on its HSPA+ broadband network capable of supporting download speeds of up to 14.4 Mbps, the company launched its new 4G plan in November 2013. The 4G wireless standard of mobile data, long-term evolution (LTE) technology allows for exponentially greater data transfer speeds (theoretically in excess of 600 Mbps) in order to handle the growing volume of high-data mobile content, including internet browsing, video streaming and gaming.
An additional benefit of the existing infrastructure is that 2G and 3G users should experience fewer dropped calls and less service interruption as more data is channelled through the 4G network, which is data only, while 3G carries both voice and data. The 4G network supports the LTE frequency of 1800 MHz, meaning that some 4G devices that operate on a different frequency are not currently compatible with DST’s network. Built in partnership with Swedish technology company Ericsson, the initial 4G launch included a total of 50 4G-enabled sites, with the service area to eventually be expanded to include all of DST’s towers.
Invisible Hand
In spite of the optimism surrounding the wide range of possibilities provided by HSBB access, relatively high fees could end up pricing a significant portion of the population out of the market. After a new tariff system was introduced in conjunction with the FTTH launch, fees have remained substantially higher than the regional average. In fact, Brunei Darussalam ranked 122nd out of 148 countries in terms of fixed broadband internet pricing, according to the World Economic Forum’s “The Global Information Technology Report 2014”. Fixed broadband internet tariffs averaged $66.38 per month, according to the report, although this was an improvement from $81.20, ranking 120th out of 144 countries, the previous year.
Entry level pricing for a monthly 5-Mbps residential package begins at BN$105 ($82) and BN$125 ($98) for businesses, excluding initial hook-up fees. Subscribers will need to pay more to access the higher speeds allowed by fibre, with monthly costs increasing to BN$165 ($129), BN$325 ($255) and BN$465 ($365) for 10 Mbps, 20 Mbps and 30 Mbps, respectively. The top tier for business rates maxes out at BN$855 ($671) a month for access of up to 55 Mbps. By contrast, neighbouring countries with more head-to-head competition – as well as much larger target markets – such as Malaysia and Singapore offer significantly lower rates.
Malaysia, which has also launched an FTTH programme of its own, allows a number of different service providers access to its fibre network and they operate in direct competition with one other. Excluding certain terms and conditions, monthly HSBB fees begin at BN$40.27 ($31.60) for 3 Mbps (offered by Astro), followed by BN$50.43 ($39.57) for 8 Mbps (TIME), BN$57.82 ($45.37) for 10 Mbps (Maxis) and BN$58.21 ($45.68) for 5 Mbps (Telekom Malaysia). Similarly, prices in Singapore are also substantially lower with numerous providers offering plans of 50-100 Mbps for under BN$40 ($31.38) and one provider even recently offering a special promotion of 1000 Mbps for BN$49.99 ($39.23).
Similar issues plague the mobile market, in which DST has a commanding market share and is the only provider of 4G service. While there is no additional monthly charge to switch to the 4G network, DST rates for data usage remain a deterrent for most due to the rapid rate of data consumption inherent in the faster network. As of July 2014, DST offered a base mobile broadband internet package for BN$28 ($21.97) per month for 2 GB of data and topping out with a BN$88 ($69.05) monthly package for 30 GB with no unlimited offerings or fee cap.
Silver Lining
That being said, the mobile market could see a renewed round of competition with the recent ownership shake-up at the country’s second mobile service provider, B-Mobile. Should the company decide to compete in the 4G arena, it could eat into DST’s substantial market lead by offering lower rates than its competitor. The move would not be unprecedented for B-Mobile, which was the first service provider to offer 3G. Although pricing for HSBB in Brunei Darussalam is significantly higher than its regional peers – due to a combination of a lack of competition, a relatively small market and cost recouping from recent infrastructure investments – a regulatory remedy could result in lower tariffs going forward. The sector’s regulatory body, the AITI, is currently drafting new regulations for the industry, with open access to the country’s fibre network one of the chief components under consideration.
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