Broadband bid picking up pace for SingTel

Many analysts now agree that South-East Asian telecoms company SingTel definitely has the cash to help build the national broadband network, whilst other industry insider agree that it also has the necessary experience, which means that support for its bid is rising rapidly.

The national broadband network project, which is expected to cost over $10 billion, currently has three parties involved in the bidding process, one of which is SingTel, a Singapore based company that owns Australian telco Optus.

Axia Netmedia from Canada and The Acacia Group, which is backed by a number of high-profile businessmen, including Doug Campbell who was the former boss of Telstra Countrywide are the other two groups involved in the bidding.

A tender to build a next generation broadband network in Singapore with government funding was won last September by SingTel and Axia Netmedia, which means that the two have worked together before.

The OpenNet consortium, as it is known, has won a grant from Singapore’s Infocomm Development Authority to the value of $750 million ($744 million) to complete its plans to provide 95 percent of households with fibre broadband by 2012.

The current speculation is that Axia and Singtel may join forces again now that Telstra has manage to get itself excluded from the national broadband network bid.

One industry analyst said “Axia only has a market cap of around $C100 million ($122 million) so to think they would be in charge of an infrastructure project of national importance is fanciful.”

Another analyst said that with a reach that spanned from Bangladesh to Indonesia, SingTel would not have any problems coming up with the necessary money. He said “SingTel would definitely have the cash – their balance sheet is in superb shape.”

Its broader strategy, however, could mean that it may be reluctant to invest such a large amount of money in just one place, said the analyst. “SingTel’s strategy has been all about investing in mobile businesses across emerging markets so putting, say, $5 billion into a fixed-line market in Australia doesn’t really gel with that.”