Geek

The SMRT-OMG Teamup: Everything You Need To Know About Our Newest Telco Hopeful

This article originally appeared on Vulcan Post

In MyRepublic’s race to become Singapore’s fourth telco, an unexpected competitor has emerged: SMRT announced yesterday that it will be teaming up with local tech firm OMGTEL (OMG) in a bid for our fourth telco licence.

The ambitious bid came as a surprise to pretty much everyone (cue OMG! puns), including our local telco and transport analysts. For one, OMG is relatively unknown to the average Singaporean, as compared to MyRepublic. Its more well-known partner may not be too helpful either: SMRT may have vast knowledge in transportation, but it’s unlikely to have much technical expertise when it comes to the telco industry. And given the number of train disruptions that SMRT faced in this year alone, it’ll be an uphill struggle convincing Singaporeans to put their faith in this teamup.

Image Credit: The Straits Times
Image Credit: The Straits Times

Here, we’ll be answering all the questions you might have about the teamup which might just become Singapore’s next telco: their motivations, the perks they’re promising us, and how they match up to MyRepublic. We’ll first begin with the obvious: who on earth is OMG?

1. Who is OMG?

OMG, or OMGTEL, was set up by local tech company Consistel for the specific purpose of this telco bid. OMG may be new, but despite how little-known Consistel is, it’s actually pretty noteworthy: the Singapore-based firm has expanded to reach clients in Malaysia, Indonesia, Thailand and the Phillippines.

Some recent history: the independent systems integrator remained relatively low-key until it locked horns with our three local telcos in May last year. For months, a standoff between Consistel, SingTel, StarHub and M1 had dragged on regarding a deal on mobile coverage at Singapore’s Sports Hub — the stalemate made headlines when it was finally resolved that May.

Consistel chairman Masoud Bassiri. (Image Credit: The Straits Times)
Masoud Bassiri, CEO of Consistel. (Image Credit: The Straits Times)

Are you wondering what Consistel does, exactly? Essentially, it builds and hosts wireless systems, leasing them out to telcos like StarHub. If you’ve ever made phone calls or posted selfies to Instagram at our Sports Hub, you have Consistel’s 3G and 4G equipment to thank.

Here’s one more thing you might not know about the small, but clearly ambitious firm: it announced its interest in the telco industry a few months ago. OMG was set up in October last year, and indicated their telco intentions soon after as a solo bidder — about four months after MyRepublic first announced their bid for a telco licence.

2. What’re some benefits that SMRT and OMG are promising to Singaporeans?

When Consistel announced its telco ambitions last October, it promised one thing: cheaper phone bills, through its OMG! mobile services. CEO of Consistel Masoud Bassiri claimed that his firm was able to build an islandwide mobile network at 30 to 40% less cost.

Image Credit: The Straits Times
Image Credit: The Straits Times

Along with yesterday’s announcement, Bassiri stated:

“OMGTEL will be a true Singaporean alliance to be of service to all Singaporeans for many years to come. It will build a cutting edge telecommunications network and provide exceptional service to its members…”

(Source: Channel NewsAsia)

Vague? Yup. It’s possible that as discussions between SMRT and OMG continue, we’ll get a glimpse of more promised perks.

One potential benefit that neither SMRT nor OMG has mentioned so far was brought up by Forrester Research analyst Clement Teo, in an interview with Channel NewsAsia: better coverage of train tunnels.

Image Credit: www.published.sg
Image Credit: www.published.sg

For a lot of us, the MRT commute is a time to catch up on WhatsApp messages, watch the latest Korean drama, or scroll through social media aimlessly. Since the MRT is one of the top places where we use our phones, it only makes sense that we need better coverage of train stations and tunnels. By collaborating with SMRT, OMG might be able to provide that.

3. Why the teamup?

What SMRT can bring to the table, OMG has said, is its “extensive media presence and commuter reach“. In turn, it’s not clear why SMRT is entering the telco industry all of a sudden — especially when it’s taken a blow to its public image from frequent train disruptions in recent years.

Image Credit: forums.hardwarezone.com.sg
Image Credit: forums.hardwarezone.com.sg

In an interview with Today, NTU economist Walter Theseira suggested one possible reason for SMRT’s strange move: an insecure revenue stream in recent years.

“As a public company, they obviously have a motivation to look for new revenue sources, especially with (recent changes to the public transport landscape)… Their revenue stream may not be as secure as it used to be.”

(Source: Today Online)

What with problems such as the new rail financing framework that caused an impasse between SMRT and LTA, SMRT’s decision to venture into new territories may be a wise choice.

4. SMRT-OMG vs. MyRepublic: Which is better?

smrt omg picture

Let’s take a quick look at how the two telco hopefuls, MyRepublic and SMRT-OMG, match up:

MyRepublic OMG/Consistel
Track record
  • Offered 1Gbps fibre broadband plan at S$50 a month — far cheaper than plans from current telcos
  • Currently offering free trials of its 1Gbps plan
  • Commands around 5% of the broadband market, as of July 2014
  • Consistel was awarded the deal for the first neutral-hosted site in Singapore i.e., the Sports Hub
  • Consistel patented Panetro, a solution for wireless elevator coverage, in 2005
Expertise Neither has direct expertise in building a full telco network.
Investor backing
  • Up to S$34.5 million from SMRT, on condition that OMG wins the telco bid
  • More than S$150 million from Consistel’s previous rounds of funding
Estimated cost of building mobile network (both companies claim to be able to build low-cost mobile networks) $250 million Up to $1 billion
Promises made so far
  • Cheaper phone bills

Right now, the stats seem to be on MyRepublic’s side: it’s made a lot of concrete promises and best of all, it’s delivered on its free 1Gbps broadband plan. SMRT-OMG hasn’t revealed many details about their bid yet, so it’s too early to tell which of them would truly make a better choice. As the competition to become Singapore’s fourth telco heats up, let’s just hope that the mobile and broadband experience Singaporeans can enjoy is about to get a lot better.

 

Subscribe to Vulcan Post Newsletter

Stay updated with our weekly curated news and updates.