Singapore telcos must seize 5G opening to boost enterprise business

FIFTH-GENERATION mobile telephony (5G) may be the panacea that telecom companies here need to re-energise their businesses.

At least two 5G networks are expected to be operational in Singapore by next year, and a Cisco study predicts that by 2025, half of mobile phone lines here will be 5G-enabled. With Singapore's mobile penetration rate at more than 150 per cent - ie every second person here has two phones - the struggle for the telcos has been to retain customers. There is no scope for organic growth. New schemes and inducements to attract new users have put pressure on average revenue per user margins, arguably the most important number in the telcos' balance sheets.

A cursory glance at the balance sheets of the two publicly listed telecom companies here shows the problem. Growth has been anaemic over at least a dozen quarters, if not more, for the consumers segment which is still the major revenue generator. The enterprise portfolio is doing relatively well for both companies but not growing fast enough. The upcoming 5G networks are expected to energise the enterprise segment by offering new avenues of growth. According to Cisco, 5G services could boost the annual revenues of Singapore telecom operators by as much as US$510 million by 2025.