Singapore telcos told: no 4G add-on fee for users on contract

April 24th, 2014 | by Alfred Siew

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While Singapore’s smartphone users celebrate a rare consumer victory today, they should not be so quick to think that the temporary reversal of a 4G price hike will lead to free add-ons like caller ID in future.

Goodwill was probably topmost on the minds of StarHub executives yesterday, when they decided not to charge an additional S$2 for existing 4G customers still on contract.

This doesn’t mean it is no longer charging that additional fee. It just won’t do so, for now, for those customers who have said they did not know that 4G would be priced separately when they signed up.

It helped, of course, that the Infocomm Development Authority (IDA) had weighed in with an investigation. In a statement yesterday evening, it said telcos shouldn’t change prices mid-way in a contract if they hadn’t been clear about price changes.

Besides StarHub, the regulator also got the other two players – SingTel and M1 – to agree not to raise 4G prices for those still on a contract. That surely pleased consumers.

Yet, in truth, there was little that IDA could have done with its given powers to force StarHub’s hand, had the telco decided to be hard-nosed about things.

A contract is a contract – you cannot say you didn’t read the fine print if you sold a house or bought a car and missed out on important details. StarHub doesn’t have to make this exception.

So, this comes back to goodwill, something the telco must have seen slipping away fast since news broke of its price hike last week. Indeed, while addressing customers’ concerns, StarHub’s statement late last evening stuck to its guns.

It said: “In regard to this [4G] promotion, we have been upfront with customers. Details of this service, including pricing and promotion expiry have been made available in our sales and marketing materials as well as on our website since its introduction in September 2012.”

This isn’t so much an issue about contracts or disclosure. It is more about competition, which consumers will worry is slowing down in Singapore.

In 2012, all three telcos slashed a generous 12GB of free bundled Internet data to as little as 2GB. When they launched 4G last year, they required re-contracting users to cut the free data limit down from the original 12GB.

Thus despite the little speed bump from the regulator this week, all three telcos could still happily charge extra for 4G in the months ahead. SingTel has said its current free promotion is up until a time it determines while M1’s offer lasts until the end of the year.

Eventually, all could offer a worse deal for consumers, who would have little choice to switch telcos in a less competitive market. This week’s events don’t change things for consumers in the long term.

Okay, maybe, just a little. Hopefully, they may make telcos think twice about taking the lead in raising prices in future. As StarHub has learnt, you face the brickbats first.

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