Three parties in race for 4th telco licence

Eight-day-old firm among those applying to take part in auction to be next mobile operator

A MyRepublic booth at COMEX 2015 on Sept 3 2015. The local fibre broadband operator is among those applying to take part in an auction to be Singapore's fourth mobile operator.
A MyRepublic booth at COMEX 2015 on Sept 3 2015. The local fibre broadband operator is among those applying to take part in an auction to be Singapore's fourth mobile operator.PHOTO: ST FILE

After a long dry spell, Singapore could finally have its fourth mobile operator.

Yesterday, three companies applied to take part in the upcoming 4G airwave auction - the first time in 15 years that new companies have expressed interest in entering the Singapore mobile market.

The interested parties are local fibre broadband operator MyRepublic, Australian telco TPG Telecom and eight-day-old firm airYotta, helmed by former executives of OMGTel, which, surprisingly, withdrew from the auction.

The auction is slated for early October. The current telcos are Singtel, StarHub and M1.

Shortly after the 5pm deadline for submission yesterday, MyRepublic and airYotta introduced their new investors and executives.

MyRepublic announced a new strategic investor in Leonie Hill Capital, a Singapore-based investment firm, without disclosing the investment amount.

MyRepublic chief executive officer Malcolm Rodrigues said: "It's not about cutting prices; we want to build a telco that runs on new economics, built from the ground up for the next generation of mobile services."

airYotta announced its leadership team of chief executive officer Michael DeNoma and chief technology officer Philip Heah.

They are former executives of OMGTel, which announced its ambition to be the fourth telco in October 2014.

OMGTel, partly owned by local wireless systems specialist Consistel, has ceased to exist following the formation of airYotta.

Mr Heah said airYotta, funded by a new group of undisclosed investors, aims to meet local consumers' insatiable demand for mobile data.

"The mobile industry is facing a major disconnect between demand and supply of mobile data capacity, exacerbated by video-streaming, new applications and services," he added.

UOB Kay Hian director of research Jonathan Koh said it made sense for airYotta to want a fresh start, with no ties to the troubled Consistel.

"If airYotta has any links, it may not be viewed positively by the authority when deciding who qualifies to take part in the auction," said Mr Koh.

Two weeks ago, Consistel was fined $300,000 - which it is appealing against - by the Infocomm Development Authority (IDA) for breaching its licensing obligations. It had signed an unauthorised agreement to sell the Sports Hub's telecommunications system, which it owns, to another company.

The police are also investigating Consistel for having submitted false documents to mislead IDA into thinking the sale agreement had not yet been signed.

Those interested in the auction for the fourth mobile operator licence will need to meet IDA's pre-qualification criteria, which include having a good reputation, to take part.

This is where delinking itself from Consistel may have introduced another problem for the newest bidder, noted Mr Ramakrishna Maruvada, a telecoms researcher at Daiwa Capital Markets. "airYotta will have no track record," he said.

Mr Clement Teo, principal analyst at market research firm Ovum, said: "MyRepublic looks better on paper, given its track record in fixed broadband."

A version of this article appeared in the print edition of The Straits Times on September 02, 2016, with the headline 'Three parties in race for 4th telco licence'. Subscribe