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Singapore Telecommunications Report Q2 2011
Business Monitor International, March 2011, Pages: 94
The Singapore Telecommunications Report provides industry professionals and strategists, corporate analysts, telecommunication associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Singapore's telecommunications industry.
Singapore’s mobile industry experienced weaker growth in the final quarter of 2010 even though the sector traditionally performed better owing to seasonal factors, which strongly suggests that the market is fast approaching saturation. However, there are still opportunities for growth in the 3G market as operators convince more 2G subscribers to switch to smartphones bundled with higher-value data plans. BMI has updated our forecast methodology in this quarter’s report and we now envisage the country’s mobile subscriber base to cross the 8mn mark in 2015, representing a penetration rate of almost 150%. Meanwhile, we forecast 8.309mn broadband subscribers in 2011 with mobile broadband technologies such as LTE and WiMAX fuelling the growth momentum.
SingTel retained its mobile market leader position with 44.3% of the market share. Although the company is experiencing strong competition from local rivals StarHub and M1, SingTel managed to secure 59.0% of total net additions in the quarter ended December 2010. Moreover, the operator posted a 4.5% q-o-q increase in postpaid ARPU, to SGD92, to bring its blended ARPU to an industry high of SGD56. StarHub also experienced a similar boost in its postpaid ARPU, which could be attributed to continued efforts to promote value-added services and high-value data plans. M1 was the only operator to see its postpaid ARPU decline but the negative effect was partially offset by the fact by its postpaid subscriber base exceeded the 1mn mark in December 2010.
Demand for next-generation fibre optic broadband services remained muted largely due to the initial high cost, a lack of network coverage and value-added services that require high-speed internet connectivity, and the popularity of mobile broadband. However, we foresee operators adopting more aggressive tactics to promote their fixed broadband services to prevent cannibalisation by next-generation mobile broadband technologies. The IDA, Singapore’s telecoms regulator, has announced plans to auction 4G spectrum licences as early as 2012 after a public consultation with the country's telecoms industry. In the meantime, rights holders of 2.3/2.5GHz frequency bands, which were allocated for wireless broadband access in 2005, were given the green light to deploy LTE and WiMAX services. That said, we think that operators are in no rush to do so as there is still some room for growth in Singapore's 3G sector.
Singapore remained in second position in BMI’s Business Environment Ratings for the Asia-Pacific region. The country closed its gap with table leader Japan after reporting an increase in its Industry Rewards score, which partially offset a decline in Singapore’s Country Risk score. Nevertheless, Singapore still holds the lead in three out of four individual scores and was let down by the country’s limited market size and growth potential.
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