Singapore Decision Will Change StarHub's Plans

SINGAPORE (01/27/2000) - The unexpected decision last Friday by the Singapore government to completely deregulate the telecommunications market here two years early "will substantially change" the investment plans and business focus of new entrant StarHub Pte. Ltd., the company has said.

The company is expected to make more aggressive moves into the Asian market in general, with a lower emphasis on Singapore, as a result of the decision.

StarHub was to have been the sole competitor in basic telecommunications services to national carrier Singapore Telecommunications Ltd. (SingTel).

But Singapore's regulatory body the Infocommunications Development Authority (IDA) announced Friday that the telecommunications market here would be fully liberalized from April 1, the date set for StarHub's entry into the market [See "Singapore to Speed Up Telecom Deregulation", Jan. 24].

According to a series of statements released by CEO Terry Clontz, StarHub has already made major investments in infrastructure based on representations from the regulator that it would have two years to focus its resources on competing with SingTel before others would be licensed.

"We fully support competition and believe that StarHub has clearly demonstrated that we are prepared to shake things up and bring the benefits of competition to Singapore very rapidly, as shown by our launch last month of StarHub Internet's free access service. However, before we can even commence operations, this competitive scenario has now suddenly changed. I am certain that this will substantially change our investment plans and business focus," Clontz said in one of the statements.

Clontz said that StarHub was still negotiating with IDA, which is expected to reimburse both StarHub and SingTel for the loss of their privileged market positions.

StarHub is a consortium formed by Nippon Telegraph & Telephone Corp. (NTT), British Telecommunications PLC (BT) and two Singapore companies, Singapore Technologies Telemedia and Singapore Power.

StarHub can be found online at http://www.starhub.com.sg/.

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