SINGAPORE: Small and medium businesses (SMBs, or companies with up to 999 employees) in Singapore are on track to invest up to US$1.5 billion on Internet access and telecom services this year, up 3 percent over 2007. Spending on cell phones and long-distance telephony services will make up about 50 percent of the total, according to the latest study by New York-based Access Markets International (AMI) Partners, Inc.

"We expect SMBs in Singapore to boost their spending on Internet access and telecom services in the years to come," says Vu–Thanh Nguyen, Singapore-based Research Analyst at AMI-Partners. "That's because of the growing number of mobile and telecommuting employees, the increasingly high penetration of notebooks among SMBs, the Singapore government's initiative to grow the wireless broadband market, and the growing popularity of Internet-enabled handheld devices."

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About half of Singapore's small businesses (SBs, or companies with up to 99 employees) and 68 percent of medium businesses have staffs that are increasingly mobile and need to travel on the job.

"Mobile employees make up from 10 percent to 50 percent of their workforce depending on the vertical segment," says Vu-Thanh. "Consequently, there is an increasingly high penetration of notebooks among SMBs. Currently, there is one laptop for every three desktop PCs in a typical Singapore SMB. More PC–owning SMBs are migrating from desktops to notebook PCs, however."

The top three reasons for SMBs opting for notebook computers are to save office space, to take advantage of their built-in Wi-Fi capability in highly connected Singapore, and for ease of use, given that most employees are either telecommuting or on the move.

The Singapore government has also initiated an island-wide wireless broadband program called "Wireless@SG." This is program free of charge and is targeted towards people on the move, including tourists, business travelers, and enterprise users. This free service offers connectivity speeds of up to 512 kbps. Many SMBs are opting to purchase premium broadband services though to allow themselves higher connectivity speed and quality of service.

"One key catalyst is the growing popularity of Internet-enabled handheld devices," says Mr. Nguyen. "With the introduction of smart phones at cheaper prices, there will be a higher adoption of these devices by SMBs. With the wireless infrastructure in place, this will encourage the usage of more bandwidth-intensive applications like VoIP and video conferencing. This wireless infrastructure will help SMBs reduce their spending on long-distance telephony services. At the same time, service providers will increase revenues through connection charges and new Web–based services such as enterprise email and CRM systems."

Several vendors have been working to take advantage of this trend. In June, Nokia announced its collaboration with the Infocomm Development Authority of Singapore (IDA) and wireless providers to try an enhanced version of Wireless@SG in an effort to improve usability, security, and WiFi usage among handheld-device users. SingTel announced its winning bid to be a provider of IDA's SME Infocomm Package initiative. This initiative will provide SMEs broadband access, email, web hosting, push-mail, and other Web-based business solutions in a single package.