SINGAPORE-One of the strongest indications Singapore’s paging market may have reached saturation was given in July when three of Hutchison Paging’s top executives quit en masse, reportedly over poor sales and disagreements over the running of the 15-month-old firm.
Chief Operating Officer Raphael Goh, together with Director of Corporate Planning Wong Weng Thong and Sales Manager Harry Khoo, left late one Wednesday night, without giving notice.
One of four paging operators in Singapore, Hutchison Paging has been hit by the double whammy of poor economic conditions and cut-throat competition.
As of January, it had some 90,000 customers, putting it third behind SingTel Paging’s 1 million and ST SungPage’s 140,000. The fourth operator, M1, is understood to have about 60,000 paging subscribers.
The situation has been further exacerbated by the fact that mobile phone prices have been falling dramatically since April 1997, when competition in the paging and cellular markets was introduced. Many Singaporeans who have never thought of owning a cellular phone because of its prohibitive costs, are now picking them up like hot cakes in the shops.
Latest figures released by the Telecommunication Authority of Singapore show 46 percent of the mobile phone users in Singapore are new, with less than one year’s service experience. This compares with just 23 percent for paging customers.
In addition, nearly one in two users has had their pager for more than three years, compared with just one in three for mobile phone users.
To counter this worrying trend, paging operators such as Hutchison have banked on value-added services like alphanumeric paging, but this has yet to pay off.
Earlier this year, Goh said his firm would break even when it hit the 150,000-mark later this year. He added the group had an “internal target” to sign up 200,000 subscribers by the end of this year and was “comfortable with the figures we are projecting.”
But things have not gone as planned.
Singapore today has 1.36 million paging subscribers, representing the world’s highest penetration of 43 percent. However, analysts estimate monthly growth rates of about 1 percent will start falling soon as the regional crisis drags on and the price of mobile phones drop further.
In a recent statement, market leader SingTel Paging said that while paging penetration in Singapore could reach saturation only when it hit 50 percent to 60 percent, “this may not hold true since the industry is very dynamic.”
“We are therefore monitoring the situation very closely,” said Lum Hon Fye, the company’s chief executive officer.
