Singaporean Telcos and Their Chinese Mobile Gambit

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.


  1. As of January 2014, Singapore had 87% smartphone penetration, with 29% of people owning more than one device. Anecdotally, the vast majority are on subsidized/contracted premium devices: iPhones, Galaxy S and Note models, etc. 
  2.  Joi Ito has a post about visiting Shenzhen that may be enlightening. 
  3. I think of this one friend as an edge case, but it’d be interesting if there were more like her: a former iPhone user, she found herself too clumsy to trust with expensive phones (they were smashed, stolen, or fell into toilets), and now uses Xiaomis because they are pretty much disposable at around USD$140 a pop. 
  4. Singapore has a bit in common with the U.S. phone market, in that only a minority pay full price or even know what the actual prices of their phones are. Everyone else pays a smaller sum upfront, with the rest of the device cost bundled into monthly fees. Some of the new Chinese phones are free/virtually free at their subsidized prices, but so are older iPhones and Samsungs, and it’s hard to see the price advantage lasting. For any brand that doesn’t enjoy the recognition of a Xiaomi, that window may close when current large-screened iPhones get priced down. 

LINE Pop-Up Store Singapore, May 2014

Japanese-Korean messaging app LINE has opened their first pop-up store in Singapore, on a prominent stretch of the core shopping boulevard of Orchard Road. It will run for a month and reap immeasurable marketing value from the high visibility and sure-to-grow lines of fans eager to buy their cleverly designed character merchandise.1

I dropped by on its first evening tonight with some colleagues, and we spent between $20–60 each. I would have spent $100, but put down a pack of 100 art postcards ($55) at the last minute. This is on top of the $40 I’ve spent on in-app purchase stickers over the last year or two of being on the platform. I don’t think any other messenger currently comes close in terms of having built brand loyalty or monetization potential that doesn’t involve serving ads or selling personal data.

Standing outside and watching the crowd, I remarked to a UX designer colleague that no other messaging app could pull off something like this in the middle of town, not WhatsApp, not WeChat. He correctly observed that none of the others have strong IP from which to make their own merchandise to even sell in a store.

“And it’s all this bloody kiddy stuff!”, I said, clutching a plastic bag filled with stickers and a pair of mugs that look like the faces of a bear and a bird. “It’s not kiddy,” he started to protest before going, “Oh alright, I guess it is.” Takeaway: “Kiddy” is largely irrelevant in Asia.


18-to-29-year-old females are its “core target,” says (U.S. CEO Jeanie) Han, explaining that in Asia, once girls were using Line, boys followed – and then this young “hip” user base helped bring in older users “like a domino effect.”

“People, especially young folks, are really adopting our stickers,” she says. “The ratio of people who are buying things online like our stickers is actually quite high in the U.S., as well as the people who are using our games inside our platform relative to the total number of users, so we’re quite optimistic in terms of our market in the U.S.” — Techcrunch, March 2013


The crowd lining up tonight was about 2:1 female to male, which seems in line with LINE’s targeting strategy. There were a few people who definitely looked over 40, and everyone present was walking out with stuffed toys, diaries, notebooks, plastic folders, tote bags, mugs, badges and the like, all emblazoned with Brown, Cony, Moon, Leonard, Sally, James, and other characters I can name because I see and employ their images in chat conversations on a daily basis. LINE is lovable, obsessionable. Few others are by design.

Against Facebook Messenger’s 200M monthly active users, LINE is said to have virtually the same MAU (out of 400M registered accounts). In comparison, WeChat (dominant in China) has 355M MAU, and WhatsApp has over 500M. I don’t consider WhatsApp and Facebook Messenger users to be the same thing2, and LINE has the greatest growth potential outside of its home country, especially in Asian countries with an affinity for Japanese culture, whereas the Chinese WeChat is likely to have a harder time. I’m pretty bullish about LINE’s success, even if their apps have a lot to improve on. For the record, LINE also reports significant revenues — $338M in 2013 — versus about $200M for KakaoTalk and $20M for WhatsApp.


  1. Within minutes of our arrival, I overheard a mom asking her two teenaged daughters, “What’s this about?”, to which they replied, “it’s kind of like WhatsApp.” 
  2. For one thing, WhatsApp is not functionally part of a platform, and probably won’t be merging with Facebook’s in the near future for various reasons. All the other messaging networks are at some stage of offering content, ecommerce, games, and enhanced communication services such as video-calling. 

ArtScience Museum, Nov 2014

Some iPhone photos from a recent visit. I’d been meaning to see the Eames one for months, but it’s always a bit hard to get out to the Marina Bay Sands because there isn’t a lot to do afterwards if you’re not in the mood for an expensive meal or drinks.

There are quite a few pieces in the Eames area, including some original interactive activities from an educational exhibit they designed, although the gallery layout leaves a little to be desired. A roughshod detail here, an odd pathway there, and lots of furniture out of reach, labeled “do not touch”, leaves you empty;  it’s only at the very end when you sink into a permitted Ottoman that you feel the humanity of their designs.

The Chanel Black Jacket photo exhibition is much more enjoyable to explore, because there’s nothing between you and the content on display.

••••

Here are the official exhibition summaries:

Explore the life and work of Charles and Ray Eames, the most famous couple in design.

Most known for their timeless furniture creations, their influence and innovation extended far beyond that into architecture, exhibition design, toy making and film.

CHANEL’s photographic exhibition dedicated to Karl Lagerfeld’s book “The Little Black Jacket: CHANEL’s classic revisited by Karl Lagerfeld and Carine Roitfeld” opens in Singapore, joining a new stage of the exhibition that underlines CHANEL’s values of creativity and modernity.

Discover the exhibition that pays tribute to CHANEL’s little black jacket. Through over a hundred photographs the jacket is adapted and worn differently by some of today’s greatest personalities in contemporary culture. Slipped on by the French singer, Vanessa Paradis, transformed into a headdress for the American actress, Sarah Jessica Parker, or adapted to Alice Dellal’s neo-punk look – this fashion masterpiece can adapt to any style.

Tandoori Corner

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Tried out an Indian restaurant near work today on the occasion of a visiting coworker’s farewell (amusingly, he’s going back to India and another Indian coworker felt it appropriate to suggest this place for lunch — we suggested he was feeling homesick himself).

It’s on Boon Tat street and quite good, although it’s probably best to come closer to 2pm; we stood outside for close to half an hour. I had the chicken tikka which was mildly spiced (if you’re a wimp like me and like to avoid discomfort).