Time's right for telco refinements
Published on Apr 29, 2014 8:02 AM
There are intricacies for the Infocomm Development Authority (IDA) to chew on in its effort to stimulate more competition to shake up the cosy troika of SingTel, StarHub and M1. This is despite the fact a template already exists in the dozen-odd bit players - known in the trade as mobile virtual network operators (MVNOs). These have hardly troubled the biggies, accounting for 1 per cent of the 8.4 million mobile lines in use. The challenge is to design the commercial parcelling out of airtime and its correct pricing so that the MVNOs would find it feasible to offer a wider range of services. The intention must be not only to lower prices, but also to serve more efficiently a market which has become more varied.
Market watchers think the first MVNO venture here in 2001, featuring the British businessman Richard Branson's Virgin Group and SingTel, was so poorly conceived that its quick exit was not a surprise. The IDA could delve into this case history to prepare a better brief for telco applicants after public comment is in.
Existing telcos are not going to have their market share eroded without a fight. The IDA can expect to receive the most imaginative submissions from them on its plan to draw more operators into the Singapore market, small though it is. Unlike credit cards, there are just so many smartphones and mobile plans individuals and businesses would need. But there is uncharted service territory which MVNOs could venture into - provided the regulations and pricing of wholesale airtime, now unregulated, are an enabler and not a barrier to entry.
This is where the regulator needs to balance aggressive competition, which often favours market incumbents, with what would be regarded as reliable service and fair charges to consumers. Just about every mobile user will have a gripe about the telco which provides the service plan. Service breakdowns and the unprofessional customer management arising from these are one. Poor maintenance of mobile networks leading to mishaps is another.
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