The three cell phone companies, which compete for customers in the island state's S$2.5 billion (US$1.4 billion) cell-phone market, already cooperate in equipment and network coverage in hard-to-reach subway trains and road tunnels.
The plan to apportion some of the estimated US$1.5 billion spending on networks for faster Web services may make these companies the first in Asia to team up for such a venture, analysts said. In Europe, operators are trying to share costs with each other and suppliers after spending US$100 billion on licenses.
"We think the sharing of infrastructure is of mutual benefit," MobileOne or M1's chief executive, Neil Montefiore, said in an interview. "It saves costs for all three companies."
The companies may share rental costs for locations of base stations or equipment transmitting phone signals, as well as wiring up buildings for cell phone coverage, he said. The three cell-phone operators are expected to start offering the services in the next one to two years.
The trend is catching on elsewhere. Earlier this month, Germany's phone regulator said it may allow six high-speed mobile phone license holders to cooperate to pare expenses, the Financial Times reported.
Lower risk
"Given the expected costs of rolling out 3G services, operators are looking at ways to minimize that," said Michael Millar, an analyst at SG Securities Singapore Pte Ltd. "The risks from 3G are going to be significantly reduced in Asia and the returns are higher as well" as licensing fees are lower, he said.
3G, or third-generation mobile technology, is what the high-speed services are commonly called. These allow users to download large files such as video on their cell phones.
In Singapore, the three cell-phone companies each paid US$55 million, or US$41 for each resident on the island. Elsewhere in the region, operators paid US$63 in Korea, US$31 in Australia and US$15 in New Zealand--lower than the US$595 operators paid for each resident in the UK and US$557 in Germany.
In Europe, operators have also shared costs with cell-phone network suppliers. Nokia Oyj and other equipment makers have lent money to operators such as France Telecom SA for network orders.
Some Asia Pacific operators have also followed suit. Cable & Wireless Optus Ltd, Australia's second-largest cell-phone company which SingTel's buying, is getting money from Nokia Oyj for A$900 million (US$450 million) of equipment from the biggest cell-phone maker.
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