New telco will nudge incumbents to bulk up on capital, says Fitch

The auction is going to shake up Singapore’s telco scene.

The city-state’s incumbent telcos are expected to raise their capital expenditure due to the smaller spectrum allocation in the 900MHz band.

According to ratings agency Fitch, this will result in the incumbents flooring the gas pedal on capex in the next two years.

Meanwhile, Fitch adds that the new MNO will focus on price to gain market share.

“In Singapore, the Infocomm Development Authority's decision to lower the reserve price of the total 60MHz spectrum set aside for a new mobile network operator (MNO) and double the allocation in the 2.3GHz band to 40MHz, were pro-consumer,” the report noted.

“The October 2016 auction will set aside 2x10MHz in 900MHz and 40MHz in 2300MHz for the new MNO, enabling the entrant to compete more effectively as it will have a good mix of

spectrum for wide coverage and capacity for 4G services,” it added.