The authorities want to make it easier for people to change telco for their smart wearables and appliances in an age where even the SIM card is being digitised.
Digital SIM cards, or eSIMs, are permanently fitted in smartwatches - like the Samsung Gear S3 and Apple Watch Series 3 that are on sale here - so that they are constantly connected to the Internet.
Technically, telcos could lock the eSIMs to their own network, resulting in consumers needing to buy new devices if they switch telco.
But the Infocomm Media Development Authority (IMDA) has proposed a rule to forbid this.
The industry regulator wants its "no SIM-lock" policy, first introduced in 1997 for normal SIM cards, to also apply to eSIMs.
It outlined this in its public consultation paper released yesterday, and the public has until July 18 to submit feedback.
The rule states that mobile operators are not allowed to SIM-lock devices sold in Singapore - including mobile phones, tablets and smart watches - so as "to facilitate competition and provide end-users the freedom to choose and switch between mobile operators without the need to change their consumer devices".
IMDA, which expects the use of eSIM to grow, said in its consultation paper: "The eSIM technology involves an evolution of the form factor and facilitates more efficient switching between mobile operators... As a matter of policy principle, the deployment of eSIM technology should be consistent with IMDA's... (no SIM-lock) policy."
The IMDA also proposed that existing consumer protection measures - including capping mobile contracts at two years and pro-rating the penalty for cancelling the contracts before they are up - be applied to the use of eSIMs too.
All three telcos - Singtel, StarHub and M1 - said they are reviewing the proposals and will respond by the deadline.
SIM cards and eSIMs store network-specific information used to authenticate and identify subscribers on a cellular network.
So far, eSIM's use is limited mainly to wearables in Singapore.
But eSIMs are expected to power an increasing number of connected machines, including smart energy meters and logistics vehicles. These machines collect data and "talk" to other machines for live updates on energy consumption or route planning.
Germany-based market research firm Statista has estimated that the connected machine-to-machine market will be worth US$199 billion (S$266 billion) in 2022 globally, more than double its value of US$87 billion last year.