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Singapore Telecommunications Limited Lays Out Its Battle Plan Against The Fourth Telco

In its latest earnings report for its fiscal third quarter ended 31 December 2016 (Q3 FY17), Singapore Telecommunications Limited  (SGX: Z74) estimated that it had a mobile market share of 48.6% in Singapore.

But the entry of Australia’s TPG Telecom could change that. TPG Telecom, which won the bid to be Singapore’s fourth telco in late 2016, expects to provide a competing mobile service here in 2018. Furthermore, TPG Telecom has not been shy about its intentions in Singapore – the Australian telco plans to win market share of between 5% and 6% within a short period of launching its services.

If TPG Telecom is successful, this could have an impact on Singtel’s Singapore mobile business segment. Singtel’s management outlined its plans to counter TPG Telecom in its recent Q3 FY17 earnings briefing.

Time to freak out?

Yuen Kuan Moon, Singtel’s chief executive for Consumer Singapore, shared his thoughts about future competition:

“Well, with regard to competition in Singapore, it has always been intense, and with or without the entry of a fourth operator, we take competition very seriously.”

He made it clear that there has always been competition in Singapore. Yuen went on to outline three things that Singtel is focused on:

“We will always focus on what’s important to our customers and firstly of course the network’s reliability and quality is our key policy.

And obviously secondly, we also look at innovation and bringing new technology and new services to introduce into the market will be some things that we will be focusing on.

And finally, equally important is customer experience and how we continue to improve on our engagement with our customers.”

Yuen also underlined the importance of Singtel focusing on its own efforts, and not on what competitors are doing. He said:

“So these are the three basic things that we are focused on, competition, and while we cannot control what our competitors will be doing, we can definitely control what we can do to influence the market.”

To be sure, although TPG Telecom has stated its goals, we do not yet know the details on how the Australian telco plans to compete in the Singapore market. Investors will have to wait and observe if the measures that Singtel outlined above will be sufficient or whether the telco will need to do more.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.