M1 – BT

Monopoly ends as M1 hooks up with iPhone

SingTel’s exclusive reign over, iPhone prices may fall

MobileOne has finally been given a bite at the iPhone, a move which breaks Singapore Telecommunications’s year-long stranglehold on the coveted touch-screen handset.

The iPhone will go on sale at M1 stores within the next two months after Singapore’s smallest operator announced yesterday that it has sealed an agreement with Apple to bring in the device.

New M1 price plans will also be introduced to accompany the iPhone but these will only be announced closer to the launch date, the firm said a briefly-worded statement.

As reported by BT on Monday, Apple has been in talks with both M1 and StarHub in the last few months as part of its global strategy to ramp up iPhone sales but a deal could not be reached earlier despite repeated appeals from their customers.

The need to commit to a high sales volume and revenue-sharing were among the factors which led to the initial impasse. This left SingTel with a default monopoly on the iPhone even though exclusivity is not a condition in its contract.

With the conclusion of the M1-Apple deal, StarHub stands as the only local telco without access the touch-screen gizmo. However, company spokesman Michael Sim said that StarHub is ‘still interested to bring the iPhone’ to its customers.

SingTel was given first dibs at selling the iPhone 3G in Singapore in August last year and this arrangement was extended to the latest model – the iPhone 3GS – this July.

Consumers currently pay nothing to $678 for an iPhone at SingTel, depending on the choice of subscription plan. With the loss of its exclusive reseller rights, market watchers say that iPhone prices could fall to reflect the new market duopoly.

‘With SingTel losing its reseller rights to the exclusive iPhone, pricing is likely to come down, implying higher subsidies,’ said DBS Vickers analyst Sachin Mittal.

‘The iPhone has always been a multi-operator offering in Australia, its strongest market in APEJ (Asia-Pacific excluding Japan),’ added Aloysius Choong, a research manager with technology analyst firm IDC Asia-Pacific.

While a smaller price tag is undoubtedly good news for consumers, resellers such as SingTel and M1 will have to wait longer to recoup their iPhone subsidies.

‘Instead of an estimated six to nine months break-even time for the iPhone deal with customers, it may take up to one-year for operators to reach the break-even point if prices come down,’ Mr Mittal said.

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