Here are the 3 biggest problems facing Singapore's telco players right now

Plot thickes in pay TV war.

According to CIMB, the adoption of tiered mobile plans is surging and that has enabled the telcos to better monetise data usage.

However, this positive is offset by falling roaming revenues, which has dampened mobile revenue growth. Competition in the broadband and pay TV space continues to be a concern, especially for StarHub.

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Roaming. Roaming revenues from both inbound visitors and outbound users are declining as users are seeking out free WiFi hotspots and purchasing a prepaid SIM pack at the destination country.

As Singapore is an open economy with a lot of inbound and outbound travellers, we estimate that gross roaming contributes to 15-20% of mobile revenues. We expect this trend to continue given: 1) the very expensive roaming charges. 

This is in spite of telcos taking measures to reduce charges and introducing unlimited data roaming allowance, 2) easy access to free WiFi, and 3) the convenience of buying prepaid SIM packs when travelling. 

Fixed broadband ARPUs are under pressure due to stiff competition from smaller players, such as M1, MyRepublic and ViewQuest.

Starhub‟s ARPU fell 4% yoy in 3Q13. Nevertheless, M1 stands to benefit the most
from the take-up of NGNBN as it is coming from a low base.

Competition in pay TV remains high as SingTel‟s mioTV continues to broaden its content offering and narrow its gap with StarHub. The MDA's recent ruling on SingTel has eased competitive pressure for StarHub as StarHub TV subscribers now do not require two set-top boxes to watch the Barclays Premier League (BPL).

However, during its recent results conference call, SingTel said that it will be “more aggressive” in acquiring content to differentiate its pay TV service from that of its competitors.