SingTel fined record $6m for outage caused by fire
October blaze at Internet exchange could have been avoided, says IDA
Published on May 9, 2014 6:00 AM
SINGTEL has been fined $6 million - the largest penalty ever for a telco - over a blaze at its Bukit Panjang Internet exchange last year that took down phone lines, banking, payment and Internet services across Singapore.
The Infocomm Development Authority (IDA) on Wednesday upbraided SingTel for not having "specific contingency plans to address serious outage situations of such a scale as the Bukit Panjang incident".
"This is a very serious service outage of a magnitude that is unprecedented, but more importantly, that could have been avoided," said Mr Leong Keng Thai, IDA deputy chief executive and director-general (telecoms and post).
IDA said the disruption affected close to 270,000 subscribers, including DBS branches and ATMs, SingHealth polyclinics, Singapore Pools branches and AXS payment machines.
Home fibre broadband users of SingTel, StarHub and M1 were also cut off from the Internet, as the fire damaged the cables of national fibre broadband network builder OpenNet, which were housed in the same premises.
The hour-long fire on Oct 9 last year was caused by the use of an unauthorised blowtorch by a SingTel staff member during maintenance works.
It sparked a slow-burning fire that went undetected as a result of further safety lapses and human error, said the IDA, which conducted an independent investigation of the incident.
The IDA criticised SingTel's "outdated" cable maintenance system, which uses lead sealant to protect the exit points for cables. This sealant needs to be heated and shrunk each time the cables need to be maintained.
It also called the use of open flames "hazardous".
IDA has also fined OpenNet and CityNet - the trustee manager of a SingTel unit that owns OpenNet - $200,000 and $300,000 respectively.
The regulator found that City-Net had failed to comply with safety procedures as the legal owner of the Bukit Panjang exchange, while the fine on OpenNet was for the "unnecessarily prolonged" restoration of services to broadband users.
Mr Leong said a "strong signal" must be sent to the operators to take network resilience seriously and invest in "the necessary infrastructure, processes and training to prevent and minimise service outages".
IDA said it will see that operators take corrective measures.
SingTel has promised to switch - by year end - to alternative sealing methods that do not require hot works. CityNet said it would install gas suppression and fire warning alarm systems in all its seven Internet exchanges.
SingTel, CityNet and OpenNet said they accepted the IDA's findings and have taken steps to prevent a repeat. SingTel said its fine will not affect its financials.
SingTel's fine eclipsed the previous record fine of $1.5 million on rival M1 for a mobile outage in January last year.
Analysts said the fines - although "insignificant" relative to the telcos' revenue - will push the telcos to invest in better systems and procedures. "Their reputation is at risk if they don't pull up their socks," said Mr Ramakrishna Maruvada of the Daiwa Institute of Research.
Maybank Kim Eng analyst Gregory Yap said: "Something still needs to be done to ensure enough diversity and choice for critical infocomm infrastructure."
IDA said it has started reviewing the need for more back-up in fixed-line, broadband and submarine cable networks, with the review slated to be done by the second half of this year.
This article was first published in The Straits Times on May 7, 2014.