3G - SingTel not ready to begin 3G trial

Saying that the quality and variety of third-generation (3G) mobile handsets is lacking and that the technology has yet to make a persuasive business case, Singapore Telecommunications (SingTel) president and chief executive officer, Lee Hsien Yang, said that SingTel was not yet ready to launch a 3G trial service.

The company planned to start a one-month consumer 3G trial last December, with a commercial launch planned sometime in the first quarter of this year. That has now been delayed, although SingTel is under orders from the country's telecommunications regulator Infocomm Development Authority (IDA) to launch commercially by the end of this year.

"We have held off the 3G trials until we have the handsets and until we can see the value proposition," Lee said. "I would rather delay than launch prematurely."

Several other carriers worldwide have cited problems with handsets, limited backward compatibility with existing second-generation (2G) networks and network stability problems.

In April 2001, IDA awarded three 3G licenses to SingTel, StarHub and Mobile One (Asia) with the stipulation that the operators must launch island-wide services before the end of 2004.

SingTel has maintained that 3G services should only be launched when there is a commercial case to be made for their introduction. In August 2002, SingTel and StarHub asked IDA to push back the end-2004 deadline, but IDA rejected this proposal in January 2003. In July 2003, SingTel awarded a $US125 million contract to Ericsson to build out its 3G network.

SingTel's Australian subsidiary, Optus, is also yet to launch a 3G service, despite a 3G launch in that country in April last year by Hutchison Telecommunications Australia Pty. Ltd. under the "3" brand. The service has attracted about 80,000 subscribers, according to analysts.