ON A typical weekend, readers of The Straits Times may be greeted with page after page of red, green and orange advertisements - the corporate colours of SingTel, StarHub and M1, Singapore's three telecommunications companies. The vibrant ads may lead people to think there's a highly competitive mobile service market here.
But it's hard to spot much innovation in those full-page coloured ads that dish out handsome subsidies on the latest smartphones to consumers who sign two-year contracts.
Could the lack of innovation be the reason why the Infocomm Development Authority (IDA) is looking to lay down new rules to woo more mobile operators here?
In its latest attempt to rejuvenate the market, the IDA has changed tack. It is focusing largely on mobile virtual network operators (MVNOs), presumably to ease players into a market where the high cost of physical networks and airwaves have been a deterrent.
MVNOs buy airtime in bulk from the existing dominant telcos - SingTel, StarHub and M1 - instead of building their own physical mobile networks.
While still remaining open to awarding a fourth mobile operator licence, the IDA is seeking the public's views on how more MVNOs can be enticed to set up shop here.
Past efforts to issue a fourth mobile operator licence have been unsuccessful. When 4G airwaves went on sale last year, no fourth mobile player showed up. The development reflected the situation in 2001 during the auction of 3G airwaves.
The IDA's consultation with members of the public to obtain their views on how to get more MVNOs to set up shop here was launched on April 22 and ends on May 20.
So far, at least one firm - fibre broadband operator SuperInternet - is interested in taking up the fourth licence, acquiring airwaves and rolling out its own mobile network. But it wants to begin operations as an MVNO first.
Does Singapore need a fourth mobile operator?
The entry of StarHub in April 2000 resulted in many service innovations, and forced SingTel and M1 to wage battle. Innovative pricing included per second billing on outgoing calls while the industry was charging in one-minute blocks.
StarHub also introduced free incoming calls while the industry was still charging the called party for airtime. Also new was StarHub's move to allow unused airtime to be rolled over to the next month.
Since then, the market has somehow settled into three big camps, with each serving about one-third of the mobile market and offering little price differentiation.
Little effort has been put into shaking up the market.
In July 2012, SingTel stopped offering generous 12GB mobile data bundles to new customer sign-ups and those who renew their contracts. Two months later, M1 and StarHub also removed their 12GB data bundles.
In September last year, SingTel ended its promotional excess data rates. Since then, its customers have been paying twice as much for exceeding their data bundle. M1 and StarHub followed suit in January this year.
In the most recent example, consumers came to know that their 4G services are in fact an "add-on" to 3G plans after StarHub announced plans on April 15 to charge for the 4G add-on, which it has been offering for free.
Like M1 and SingTel, StarHub has been waiving the monthly $10.70 add-on fee since its 4G service launch in 2012.
Few other markets operate 4G services as merely an add-on. In Hong Kong, Britain and Australia, for instance, 4G plans are sold separately from 3G ones.
An online poll of almost 1,000 people by The Straits Times on April 17 revealed that close to 90 per cent of all mobile users thought they had already bought a 4G mobile plan and did not know the 4G service was merely an extra with a 3G plan.
After the IDA intervened, all three telcos agreed on Wednesday last week not to impose the 4G add-on fee on customers with current contracts.
A spokesman for SingTel said that the cost of its networks - and the investments made in them - is one of the factors affecting prices.
M1 said that the Singapore market is already "highly competitive", while StarHub is of the view that the local market is "well served by three mobile operators".
"Competition goes beyond price. Intense competition in Singapore's small and saturated mobile market has already driven down mobile charges as a whole," said a StarHub spokesman.
Local telcos' service charges are on a par with those of developed markets elsewhere, according to a Bank of America Merrill Lynch report that was released on April 21.
Singapore telcos' service revenue as a percentage of gross domestic product here was 1.1 per cent in the fourth quarter of last year. This is higher than Australia's 1 per cent and Hong Kong's 0.6 per cent, but lower when compared with the 1.5 per cent in Japan and 1.2 per cent in the United States.
While Singapore may need some shakeup to bring back the intense competition seen in yesteryears, it is unlikely to come in the form of "a fourth telco" in the traditional sense.
Even for MVNOs, Singapore will prove to be "a difficult market" due to its small size, which will result in even smaller market niches for MVNOs to target, said managing partner Rob Bratby of technology law firm Olswang Asia.
Mr Ajay Sunder of market research firm Frost & Sullivan agreed, saying it is "not viable" for a fourth telco to set up shop here.
"It would take more than 10 years for a newcomer to break even in a developed market like Singapore, compared with about seven to eight in developing markets like India," he said.