Innovation the key to a vibrant mobile market

Much has been written of late about the need for a more vibrant and competitive mobile market in Singapore, leading to a better outcome for consumers and the industry, and regulatory efforts to achieve that goal ("Firms fight over mobile band"; Oct 16, and "Hefty discount on airwaves to woo 4th telco"; July 8).

The Infocomm Development Authority (IDA) is in the midst of framing its spectrum position, and, to date, has shown a clever approach towards achieving these goals.

Its approach ensures that the spectrum is awarded to those who can best benefit from it - be it a new mobile operator or an existing one.

The entrance of a fourth facilities-based operator is still an open question, but there is limited historical proof of benefits in the long term for both the industry and consumers.

Many markets around the world are witnessing a consolidation of mobile operators. In the few countries where there is talk or the existence of a new facility operator, the demographics and characteristics of that particular economy and mobile market are vastly different from Singapore's.

Beyond consolidation, capital market experts would attest to the fact that tower sharing, spectrum sharing, and even network sharing among operators, is commonplace.

Trends favour more network sharing and or consolidation of the physical infrastructure. If the

larger prize remains - consumer benefit through better price, services or experience - then, competition that drives innovation is the real answer.

A new breed of virtual operators (like Google's Project Fi in the United States), driven by the technological advances in smartphones and cloud computing, has emerged as an answer for consumer innovation and enhanced consumer experience.

Innovation led by such operators would also lead to better utilisation of infrastructure and scarce radio spectrum - a win-win for all.

Evidence is abundant that consumer-centric entrants are market winners in most industries.

However, given this new breed of telcos' dependence on partnerships with incumbents, a healthy and responsible competition framework becomes a necessary pre-condition.

The keys to this prize will be found with honest negotiating principles, just pricing and equivalency of service between facilities operators and virtual operators - and that's where the IDA could play a worthy role.

The focus should be on innovation rather than a fourth facilities-based operator. If done right, Singapore consumers will enjoy the rewards of service and price for years to come.

Andrew Haire

United States

A version of this article appeared in the print edition of The Straits Times on November 11, 2015, with the headline 'Innovation the key to a vibrant mobile market'. Print Edition | Subscribe