2 advantages incumbent telcos have over TPG

The new kid may face operational challenges.

According to DBS Group Research, the mobile market revenue will contract amidst more new entrants, with further price cuts in the coming 24 months leading up to TPG’s official launch of
services and falling IDD revenue.

"We believe this would result in a c.3.5% contraction of the overall Singapore mobile market by 2022, compared to 2016. We do not discount the possibility of increasing MVNO presence in Singapore in the future," DBS said.

Fixed-line provider MyRepublic has reportedly spoken of its plans to launch a MVNO mobile service locally by mid-2017, after its plans to be a mobile network operator were thwarted by TPG.

"We believe that incumbents still have some competitive advantages: bundling of mobile and other services such as pay TV and home broadband services favours incumbents; and TPG may face operational challenges, such as negotiating rentals on buildings for its in-building coverage, among others, as well as limited windows for laying underground network during train network shutdown hours," the brokerage firm said.
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