One of the immutable truths of living in Singapore and reading our national broadsheet, The Straits Times, is that your Saturday morning news will be interrupted by three large and distinctly color-coded blocks of full-page advertising taken out by the major telcos: red for Singtel, green for StarHub, and orange for M1.

In the late 90s, the brands advertised consisted mainly of Nokia, Motorola, Alcatel, Sony-Ericsson, with a few models from minor players like Sharp, HTC, and Panasonic. You’ve probably recognized the ones still around. Apart from a few new entrants like Apple, Samsung, and LG, the Saturday ad landscape was quite stable for over a decade.

Something started happening this year, around the time Xiaomi launched local operations — their first market outside of the Chinese territories. New brands have started to share space alongside the established premium brands. Oppo/OnePlus. Huawei. Asus. ZTE. All very competitive spec for spec, dollar for dollar.

It’s significant that these Chinese-designed products now share equal space with the Samsungs and LGs in expensive telco media buys, in one of the world’s most saturated and advanced smartphone markets.¹ There are similar products coming out of other Asian countries², but the Chinese brands have far more visibility here.

I won’t go into how Xiaomi employs a differentiated, social media-driven sales model, but I will say that they got a lot of positive press at the start, driving home the idea that they offered comparable quality and reliability at a fraction of the cost. But they’ve been the only ones to get such an image in the mainstream mind, to my knowledge.

The rest are coming into town aggressively — Oppo opened a flagship store at Suntec City, a central mall, and I swear I’ve seen a Huawei store along Orchard Road — but their cachet seems strongest amongst the small group of tech and Android enthusiasts attracted to low-cost, high-value devices, which are replaced frequently.³ These are not mass market items yet, and I wonder when their moment will come, if at all.

What interests me is why the telcos are throwing their weight behind these entrants. Are they a bargaining chip to negotiate better hardware prices with the others, regardless of sales? Or do the postpaid ⁴ margins on selling already-cheap Chinese phones to consumers just look that much better? Or could it be driven by actual market demand?

My leading theory is that it’s simply a reactionary move that doesn’t consider the longer-term effects of promoting these price-disruptive products. Why? Because telcos are instinctively programmed to serve products at every available price point.

But the low price, contract-free nature of how consumers can otherwise obtain these devices is a threat to the lucrative business of locking people into contracts. Including such devices alongside premium devices in weekly advertising validates them. In the past, doing the same with a $50 Alcatel featurephone and a $500 Nokia “multimedia computer” was apples and oranges. Now, the products at both price points are much more similar, and one of them doesn’t need to be paid off in monthly installments. Legitimising cheaper smartphones inspires potential postpaid customers to simply buy a contract-free phone online (or pick one up in a store), and then save with a prepaid mobile line instead. At least that explains why Oppo is paying downtown rent on a flagship store. The telco strategy, though, that isn’t so clear.