Could Telco Consolidation Spell the End of Attractive Mobile Plans?

The deals involving Simba-M1 and StarHub-MyRepublic mark a sea change for the industry but do not have to result in poorer outcomes for consumers.

- Irene Tham

Fourth telco Simba Telecom surprised the industry on Aug 11 when it made a $1.43 billion bid for rival M1's telecommunications unit.

The rumour mills had been rife with talks of an M1-StarHub merger since 2020, when the duo joined hands to win one of two licences to operate a nationwide 5G network.

A day after Simba's move, StarHub completed its takeover of the fixed broadband business of MyRepublic, making it the second act of a climacteric telco consolidation here in two days.

These events suggest a turn in the tide for the telco industry, after years of market liberalisation spurred competition among providers to offer a wider suite of services and cheaper deals.

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The Simba-M1 deal is currently being reviewed by the Infocomm Media Development Authority (IMDA). If approved, it will be Singapore's first telco consolidation after almost three decades of market openings that sparked waves of innovation with each new entrant.

The first wave hit local shores when M1 broke Singtel's monopoly in 1997, introducing for the first time cheaper off-peak rates and free airtime.

The momentum continued when StarHub became the nation's third mobile operator in 2000. It introduced free incoming calls and per-second billing – a first here. Prior to StarHub's entry, telcos were charging by blocks of one minute.

In 2016, the IMDA (then Infocomm Development Authority) made room for a fourth telco with a 4G mobile airwave auction and facilitated the entry of mobile virtual network operators, in what would be a sea change in the local telco scene.

Dark horse Simba (then known as TPG Telecom) showed up at the eleventh hour with its aggressive $105 million bid – in similar fashion to its surprise takeover bid for M1 – and edged out two other bidders for the coveted 4G licence.