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TPG will put pressure on existing telcos

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While fourth telco has uphill task, consumers will be winners

Australian telco TPG Telecom's entry into the telecommunications market here marks the first time that the industry has seen a new player since M1 was founded in 2002.

The Government has long been open to the idea of a fourth telco to shake up the market, but barriers to entry have been prohibitive.

Setting up a telco is a massive outlay - preparing all the infrastructure will cost an estimated $1 billion - and any newcomer will have to face fierce competition from Singtel, M1 and StarHub.

To give newcomers a leg up, the Info-communications Media Development Authority's recent 4G airwave auction for the fourth telco was limited to new entrants, with a discounted reserve price of $40 million instead of the usual $100 million, to lower barriers to entry.

There were two contenders for the auction - TPG and local Internet provider MyRepublic.

MyRepublic - which lost out in the auction with its $102.5m bid, just shy of TPG's $105m - has been cultivating the ground for some time as an Internet service provider, which would have eased its way into the mobile market.


TPG is relatively unknown to consumers here and will face an uphill challenge to win them over.

It will also have to differentiate itself from the other three telcos with its customer experience and offerings.

In Australia, TPG has SIM-only mobile plans with no lock-in period, such as one for A$39.99 ($42) a month for 10GB of data, plus unlimited calls and SMSes.

A comparable plan from Singtel with unlimited calls will set you back $78.85 a month.

What plans TPG ultimately ends up offering here will depend on its strategy and how it wants to position itself in the market.

Still, TPG's entry into Singapore is likely to put pressure on the incumbents to step up their game, with consumers expected to be the winners.

Take it from Dr Yaacob Ibrahim, Minister for Communications and Information.

Noting that Singapore has a fourth telco, he said in a Facebook post that "consumers can look forward to more attractive price packages and innovative services".