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Price war in Singapore as fourth mobile operator looms

The way that a new MNO can turn a mobile market upside down has been clear in France and other countries, but the phenomenon is not confined to Europe. In Singapore, ISP MyRepublic aims to use some of the tactics employed by Free Mobile in France, to disrupt the island state’s mobile status quo, and it is having an effect before it has even secured a licence.

MyRepublic is bidding for Singapore’s fourth mobile licence and says it can roll out a network very cheaply, thanks to its existing broadband and WiFi assets – an approach harnessed very effectively by Free, which lowered its cost of delivery by using its fixed lines to backhaul small cells, and by adopting WiFi-first mechanisms.

CEO Malcolm Rodrigues told Bloomberg that it expected to become profitable within three years of gaining a licence and starting build-out. Using its existing fixed lines would allow it to deploy a nationwide 4G network for about S$300m (US$215m), less than one-third of the cost of a greenfield build-out, he argued.

Apparently, the existing three MNOs – SingTel, M1 and Starhub – are already reacting to the possibility of a new rival, even before the auction of the licence (and new spectrum) in the third quarter. A price war has broken out for the first time in four years, with M1 slashing its prices just days after SingTel did the same. This looks like an attempt to pre-empt a low cost entry by MyRepublic (or another potential winner of the new licence, such as OMGTel). The ISP announced this week that it would bring back unlimited data plans – priced at S$80 per month, or S$60 for MyRepublic fixed line customers – and would offer a mobile broadband tariff from as little as S$8 (US$5.80) a month for 2GB of data.

Singtel then announced a new add-on plan, DataX2, which gives new and re-subscribing customers the option of doubling their mobile data allowance when they top up and extra S$5.90 a month on a two-year plan. M1 followed with a range of contracts for new and existing users offering a similar S$5.90 bolt-on option. But MyRepublic’s headline offer of S$8 for 2GB still shines next to SingTel’s S$20 for the same data allowance, or StarHub’s S$21.45 for 3GB. However, MyRepublic’s prices do not include value added services such as caller ID and roaming which are likely to carry extra fees.

Despite all this posturing over tariffs, Rodrigues has been insisting his strategy would not rely on being a price disruptor. Instead, he says he would target 250,000 mobile subscribers in its first year, and 700,000 within five years, by differentiating MyRepublic through unlimited data plans, multiplays and innovative services.

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