TPG eyes raising up to $300m as it rolls out nationwide coverage in 2018

And check out what MyRepublic and the incumbent telcos have to say on TPG's win.

TPG Telecom has done it -- it won the new entrant spectrum auction of the Info-communications Media Development Authority, securing its spot as Singapore's fourth telco.

TPG acquired all of the spectrum made available at the auction for a total purchase price of $105m. Its rival, MyRepublic, submitted a bid worth $102.5m.

With the win, TPG foresees incurring capital investment in the range of $200m to $300m to establish a mobile network with nationwide coverage by September 2018, the time when it is expected to start delivering services.

"This rare opportunity will enable TPG to expand its business into Singapore, bringing tremendous value to Singaporean consumers whilst generating excellent long-term returns for TPG shareholders," TPG said.

Life goes on for MyRepublic

For MyRepublic CEO Malcolm Rodrigues, bidding $105m and beyond did not support the group's vision and business case for mobility in Singapore.

He argued that with a target of 9% market share, the MyRepublic Singapore mobility vision involved MyRepublic leveraging upon its existing fixed broadband operations to create a low break-even, fixed-mobile operator.

"At $105M, the price of spectrum simply went beyond the level in which the MyRepublic mobility business model could operate," he said.

He furthered, “we envisioned being part of a healthy ecosystem of four competitive operators -- operators who would be spurred by a new entrant to support unlimited data-centric mobile service offers. At the current spectrum price, a new entrant must achieve a much higher market share to survive and be successful. This creates a risk level in the business plan that doesn’t make sense to us for the Singapore market."

MyRepublic said it will now continue expanding its operations in fixed broadband services regionally, while also seeking opportunities for mobility in other markets. It has plans to construct an enterprise IoT platform to drive the M2M requirements of the future.

What incumbents have to say

Analysts fear that M1 will be impacted the most should a new telco comes. A spokesperson from the group said the added competition drives M1 to ensure our customers enjoy the best value products and services.

"Supported by our strong financial reserves, M1 is well-positioned to compete, and customers can look forward to continuing to enjoy the best customer experience with our comprehensive suite of fixed and mobile offerings,” the spokesperson said.

The same goes with StarHub, who said they will be joining the general spectrum auction scheduled in 1Q17 to further enhance their services.

“StarHub will continue to focus on providing customers with quality service and reliable network, and drive returns for shareholders. We look forward to participating in the upcoming auction to secure the spectrum we need so as to offer our customers more advanced mobile services,” a StarHub spokesperson told Singapore Business Review.

Meanwhile, Singtel Chief Executive Officer Consumer Singapore Yuen Kuan Moon said they look forward to competing on a level-playing feed with the new kid.

“Competition is not new to us and we look forward to competing on a level-playing field. Fundamentally, we remain focused on what is important to our customers – an extensive and reliable network coverage, high speeds both in and out of the home, good customer service experience and innovation,” he said.

In an earlier interview, Singtel reiterated that Singapore doesn't need a fourth telco, saying the competition amongst the current three players is already intense.