New Singapore telco faces uphill battle

New Singapore telco faces uphill battle

An upstart faces a tough climb to break into Singapore's already saturated telecom industry.

The city-state, with a population of only around 5.5 million, already has three mobile-service operators, all of which have some government-linked ownership. And there aren't a lot of residents who haven't already picked a carrier: The mobile penetration rate is hovering around 150 per cent, meaning many people have more than one device, according to Ryan Tay, senior research manager of Telecoms at IDC Asia Pacific.

But Malcolm Rodrigues, founder and chief executive officer of internet service provider MyRepublic, believes there's room for a fourth telco in Singapore.

"There's a whole other climate for data, as we expect the Singapore mobility market to grow from 8 million to 9 million over the next year, and the demand for Internet of Things (IOT) will also see over 50 million devices requiring connectivity in the next five years," Rodrigues told CNBC.

"Existing operators are not ready to support it," said Rodrigues, who is also a former senior executive at Starhub, Singapore's third telecommunications company.

Rodrigues isn't alone in thinking another company can eke out a share of the tight market.

IDC Asia Pacific's Tay thinks there's definitely room for a fourth telco in Singapore, "considering the growing trend of people owning more than one mobile device, driven by the shift towards a mobile workforce and consumerization."

The government is on board with adding another competitor as it's looking ahead to keeping up with technology advances. The Infocomm Development Authority of Singapore (IDA) told CNBC that "with consumers' increasing demand for mobile broadband service, new technology and service developments in the industry (e.g. emergence of 'Machine-to-Machine' communications), there may be new business opportunities and market segments for new players."

MyRepublic is aiming to win 9 per cent of the Singapore mobile market within five years, a goal its CEO calls "pretty conservative." The company is already offering a home broadband service in Singapore, with 50,000 subscribers.

But it's not clear how much of the pie is up for grabs. Currently, IDC estimates SingTel has around 50 per cent of Singapore's mobile subscribers, while Starhub has 27 per cent and M1 has 23 per cent.

Those three aren't twiddling their thumbs while waiting for competition to arrive.

In early March, Singtel, Starhub and M1 announced they slashed their post-paid users' prices for add-on mobile data. In local media, it was widely reported as a "mobile price war" ahead of potential entrants.

More about

Purchase this article for republication.



Your daily good stuff - AsiaOne stories delivered straight to your inbox
By signing up, you agree to our Privacy policy and Terms and Conditions.