VZCZCXRO2039
RR RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHGP #1205/01 1030839
ZNR UUUUU ZZH
R 130839Z APR 06
FM AMEMBASSY SINGAPORE
TO RUEHC/SECSTATE WASHDC 9557
INFO RUCPDOC/DEPT OF COMMERCE WASHDC
RUCNASE/ASEAN MEMBER COLLECTIVE

UNCLAS SECTION 01 OF 02 SINGAPORE 001205 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR AMBASSADOR DAVID GROSS 
STATE PASS USTR FOR AUSTR BWEISEL, JJENSEN, AND JMCHALE 
COMMERCE FOR JBAKER 
 
E.O. 12958: N/A 
TAGS: ECPS ETRD EIND EINV ECON SN
SUBJECT: AMBASSADOR RAISES TELECOM AND MEDIA ISSUES WITH 
MICA MINISTER LEE 
 
REFS:  A) SINGAPORE 1119 B) SINGAPORE 946 
 
¶1. (SBU) Summary: Singapore is close to a decision on 
local-leased ("last mile") circuit connections for U.S. 
and other telecom operators (a significant implementation 
issue under our bilateral Free Trade Agreement or FTA), 
Minister for Information, Communications and the Arts 
(MICA) Dr. LEE Boon Yang told the Ambassador in an April 
10 meeting.  The regulator's obligation was to the 
telecommunications industry and not to SingTel, the 
government-linked dominant carrier, he claimed. 
Regarding the possibility of more restrictive regulation 
of exclusivity agreements between pay television 
operators and content providers, the Minister expressed 
concern that the early entrant into a market (i.e., 
StarHub Cable Vision) might gather a "stranglehold" on 
the most compelling content.  He stressed that his 
ministry would not stand idly by if the incumbent 
attempted to corner the market.  End Summary. 
 
Resolving FTA Telecom Commitments 
--------------------------------- 
 
¶2. (SBU) Minister Lee asserted that the GOS had every 
intention of fulfilling its FTA commitments to offer 
local-leased circuit (LLC) connections at "reasonable 
(wholesale) rates" using open standard technical 
specifications (ref A).  He said his office was "close to 
a decision" on an appeal made by SingTel late last year 
following the Infocomm Development Authority's (IDA) most 
recent decision concerning LLC's. 
 
¶3. (SBU) Minister Lee detailed the long, drawn-out 
process associated with implementing these FTA 
commitments that commenced in May 2003.  Observing that 
it was "taking too much time," he said that MICA must 
give SingTel the benefit of the law in terms of right of 
appeal, but stated that the intent was not to give 
SingTel an advantage.  He assured the Ambassador that 
MICA was "not playing a game." 
 
Lack of Transparency 
-------------------- 
 
¶4. (SBU) Asked about the lack of transparency in MICA's 
appeal process, wherein industry -- in this case SingTel 
-- was allowed to make private appeals directly to the 
Minister, Minister Lee explained that, according to 
current regulation, no provision existed for other 
parties to participate.  He argued that an open 
(transparent) approach "would pose difficulties," in 
particular since the private appeals process was designed 
to protect commercially-sensitive information.  The fact 
that the Minister could call for additional information 
from any source, including parties not involved in the 
appeal, partly opened the otherwise closed-door process, 
he said. 
 
¶5. (SBU) Noting that both IDA and SingTel were government- 
linked entities, the Ambassador asked how this common 
parentage affected the adjudication process.  The 
Minister explained that the two organizations operated at 
arm's length, and that the government had been successful 
in creating firewalls to prevent conflicts of interest. 
Minister Lee said that, from time to time, IDA's rulings 
were perceived as unfriendly to SingTel, but IDA's 
obligation was to the telecommunications industry, not to 
SingTel. 
 
Media Exclusivity Agreements 
---------------------------- 
 
¶6. (SBU) Asked whether similar firewalls among government 
and government-linked entities existed with regard to 
regulating exclusivity arrangements between pay 
television operators and content providers, Minister Lee 
affirmed that the Media Development Authority (MDA) 
sought to ensure a level playing field (ref B).  He 
explained that, in November 2003, the government had 
issued a tender for a second pay television license, but 
no one applied.  He offered that the timing had not been 
ideal, coming right after SARS; Singapore also is at a 
disadvantage given that its market is both small and 
differentiated, with a multi-racial and multi-lingual 
audience. 
 
 
SINGAPORE 00001205  002 OF 002 
 
 
¶7. (SBU) Minister Lee said that MICA would not stand idly 
by if the incumbent, StarHub Cable Vision, tried to 
corner the market on the best content.  He allowed that a 
3- or 5-year exclusivity period would give other 
companies a chance: "this would allow an insurgent to 
enter the market and rise up against the incumbent."  In 
contrast, a 10-year exclusivity agreement could preclude 
competition in the pay sector segment of television.  The 
Minister said that MICA planned to re-offer a second pay 
television licence in the future, and suggested that new 
technologies such as distributing television over 
internet protocols might prove key to a new entrant in 
the market. 
 
Bridging the Digital Divide 
--------------------------- 
 
¶8. (U) Minister Lee noted that he recently had proposed 
to Ambassador David Gross that we convene informal 
discussions on "How to Bridge the Digital Divide" during 
the September IMF/World Bank meetings in Singapore. 
Minister Lee explained that his proposal focused on how 
countries could catch up in today's high-tech world. 
 
Cultural Ties 
------------- 
 
¶9. (U) The Ambassador and Minister Lee also discussed the 
extensive cultural ties between the United States and 
Singapore, including the Embassy's American Connection 
ties with the National Library Board.  The Minister 
expressed his hope that more Singaporean artists would be 
able to participate in U.S. events, noting that corporate 
support was critical. 
 
HERBOLD