Flat to low-single-digit growth for S'pore telcos in 2013: analysts

Flat to low-single-digit growth for S'pore telcos in 2013: analysts
By Thomas Cho | Posted: 17 December 2012 1831 hrs
     
SINGAPORE: The three main telco operators in Singapore will have a tough year ahead as analysts expect flat to low-single-digit revenue growth, despite the rollout of the high speed 4G network.

The telcos face slowing industry-wide growth and loss of sales in core voice and data markets as their hip, young, internet-based competitors offering free services are stealing market share.

Yet, digital and mobile is where Singapore's biggest telco is placing its biggest bet on.

SingTel's group CEO, Chua Sock Koong, said: "Growing the top line would involve better monetisation of mobile data, which is a fast growing area, (and) looking at new revenue sources -- that's where our investments in a lot of digital life investments will come true."

According to the International Data Corporation (IDC), vendors will ship more than 1.7 billion mobile phones globally this year.

But the long queues for new releases of smartphones like iPhone 5 and Samsung Galaxy Note 2 do not immediately translate into higher revenue for SingTel, StarHub and M1.

OCBC Research's senior research manager, Carey Wong, said: "Singapore's penetration rate is already close to 150 percent. It is a very mature market. Any raise in ARPU (Average Revenue Per User) would probably take some time to flow through.

"We are also seeing a little bit of subscriber growth since the penetration is so high. We think low single-digit is probably correct for such mature market."

New revenue may come from the telcos moving into content and infrastructure and may also tap upstream customers like government agencies and corporations.

Standard Chartered Bank's director of technology and global equity research, Don See, said: "We need to see telcos demonstrate willingness to be more entrepreneurial -- to try out new things and to actually have a more bigger willingness to step away from their legacy business to capture some of these growth opportunities."

StarHub has been the outperformer in 2012 with its shares up by 33 percent.

SingTel and M1 have both climbed about 10 percent.

- CNA/lp

- wong chee tat :)