Ultra-low telco prices may hurt service quality and security, says StarHub CEO

SINGAPORE – After three decades of restructuring and relentless price competition, Singapore’s telco industry may be circling back to a three-player market – a shift that StarHub chief executive Nikhil Eapen argues is necessary to move consumers away from a race to the cheapest data plans and towards better service quality and security.

That change hinges on

Simba Telecom’s proposed $1.43 billion acquisition of M1

, which, if approved, would be the sector’s largest consolidation in its 30-year history and could reset Singapore’s consumer telco market, Mr Eapen told The Straits Times in an interview.

The local market cannot afford another cut-throat price war, he said, noting that a more stable environment enabling the sector to recover from years of margin pressure could lead to opportunities for innovation, particularly in cybersecurity, and ultimately benefit both consumers and operators.

Over the last 10 years, Singapore’s telco oligopoly of Singtel, StarHub and M1 was disrupted by the entry of mobile virtual network operators (MVNOs) like Circles.Life and Zero1, and a fourth telco operator, Simba Telecom – which competed largely on price.

MVNOs were able to offer low-cost plans as they did not have to build any infrastructure and simply leased network capacity from the major operators. Meanwhile, Simba, which is backed by Australia telco TPG, was able to spend less than its competitors to build a data network optimised for urban coverage.

The result was some of the lowest rates for mobile data in the developed world. According to a 2023 UK study,

Singapore ranked 59th globally for mobile data pricing

, with an average price of 63 US cents (81 Singapore cents) for 1GB of data.

Race to the bottom

While this was initially beneficial to customers, Mr Eapen said that the Singapore market is too small for prices to be sustainable at those levels, with the prolonged price wars ultimately disadvantaging the sector by curbing investment and stalling the roll-out of better services.

“When a mobile subscription costs the same as a fancy cup of coffee or half the price of a cocktail, extreme diminishing returns set in and this leads to very poor return of investment for innovation.”

As consumers gravitated towards the cheapest mobile plans rather than higher-quality offerings, smaller players had little incentive to invest in areas such as innovation and cybersecurity, fuelling a cycle that further weakened the market, Mr Eapen said.

“Safeguarding critical infrastructure as an operator does not come for free. It requires significant investments in cybersecurity resilience, and that does not necessarily align with an extreme low-cost price model.”

A 2025 report showed that even though mobile service subscriptions in Singapore grew by around 2.4 per cent from 2017 to 2023, average annual mobile revenue growth fell by 5.4 per cent.

In 2016, StarHub as Singapore’s second-largest telco operation chalked up revenue of well over $1 billion. But it began to see a steady decline in its mobile services business as intense price competition took hold.

Shares of the company, which traded just under $4 at their highest levels in 2016, now trade for just $1.14.

For the first half of 2025, it reported a 5.4 per cent drop in revenue in this segment to $274.1 million, citing lower income from roaming and value-added services, as well as lower voice and data subscriptions.

In its third-quarter financial report, mobile services revenue continued to fall, with a 10.1 per cent decline year on year. StarHub will announce its fourth-quarter and full-year results for 2025 on Feb 12.

“In the past, growth went straight to the bottom line for telco operators; there was strong growth in profits with small percentage increases in revenue.

“But on the flip side, small percentage declines in revenue get amplified into quite significant declines in profit,” said Mr Eapen, who took over the top position at StarHub in December 2020 after serving as deputy chief executive at parent company ST Telemedia.

Focusing on customer needs

StarHub had previously been part of market speculation over a potential takeover of M1, before Simba’s offer was announced in August 2025.

Now, Mr Eapen said the worst of the price pressures are likely over, and that the Singapore telco market could begin to stabilise from the second half of 2026. This would allow prices to readjust, enabling industry players to refocus on meeting customer needs.

It would also enable more investments in improving cybersecurity. The 53-year-old chief executive said this has become a key concern for consumers, particularly as reliance on digital services grows.

“Value is not necessarily about price. It’s also about whether I can keep myself and family safe with total peace of mind. That’s really important today.”

But cybersecurity threats, especially to mobile users, have risen sharply in both volume and sophistication over the last few years.

In a statement on Dec 29, 2025,

 the police said there had been at least 223 cases of phishing scams reported since Nov 1, with around $622,000 lost to scammers.

Phishing scams are fraud attempts where criminals pretend to be a trusted organisation or person to trick victims into giving sensitive information or money. They often contact their victims through SMS, WhatsApp or phone calls.

The Government’s ScamShield initiatives, which include an artificial intelligence-equipped app to identity potential scam threats, have helped to drive consumer awareness of the importance of cybersecurity.

But Mr Eapen believes major telco operators have a level of “custodial responsibility” to not only strengthen their infrastructure but also protect and educate consumers.

The growing risk of ransomware attacks and disinformation campaigns by state-backed actors has made it more urgent to strengthen the country’s cyber resilience.

He said identifying and countering such threats would require the ability to process vast amounts of data using analytics and artificial intelligence.

“Safeguarding against existential cybersecurity threats is not commodity play, and there are not many players who can deliver against these kinds of complex holistic needs, which are front-footed from a technology standpoint.”

Positioning for a new chapter

StarHub’s “Infinity Play” strategy, which brings its digital products and services under a single umbrella, is aimed at repositioning the business for its next phase of growth, Mr Eapen said. The approach is also expected to help the company gain deeper customer insights to improve its products and services.

“Singaporeans are ready for the market shift, but the circumstances have to be right and the market’s messaging and direction have to be there. It can’t just be about low prices that no one really needs any more,” he said.

“We intend to be aggressive across all our platforms so that we can get our mobile business to revenue retention and back to growth.”

Mr Eapen claimed StarHub’s acquisition of the remaining stake in

MyRepublic Broadband in August 2025

for $105.2 million has positioned it as the No. 1 broadband provider in Singapore by market share. According to its third-quarter financial report, the company has 568,000 subscribers with an average revenue per user of $34.

Broadband service revenue for the first half of 2025 also increased 4.4 per cent year on year to $128.3 million. StarHub first bought a 50.1 per cent stake in MyRepublic in September 2021 for around $162.8 million.

He reiterated that the telco has no intention of changing the smaller brand’s business model of targeting a niche customer base with features such as uncapped download speed limits.

It will continue to identify other consumer segments “which are natural pockets of strength”, and intends to retain the “secret sauce” of such acquired companies even as they are embedded onto the StarHub platform.

Meanwhile, StarHub’s enterprise business segment has been much more successful, with its order book growing 20 per cent year on year, thanks to large government and corporate deals in Singapore and Malaysia.

Mr Eapen said the company is eyeing more acquisitions to increase its capabilities and resources as it scales up its enterprise business. This could include companies with expertise in cloud and data engineering, as well as cloud-based networking.

Moving forward, the company will also focus on automation and continued business simplification, leveraging artificial intelligence technologies in its next phase of growth.

Singapore’s enterprise telco sector is well ahead of regional peers in both the ambition and sophistication of its projects and level of market demand, said Mr Eapen, adding that the strong nexus between the Government and key industry players remains the Republic’s biggest advantage.

He said this provides a strong foundation for the continued evolution of Singapore’s telco ecosystem, and that he remains optimistic despite near-term challenges in the consumer business.

“I’m really excited about coming out of this difficult period well-positioned with growth possibilities. With a stable market, operating leverage will start to work in our favour. I can’t guarantee a timeframe, but I’m sure we will get to this outcome.”

Clarification note: This story has been updated for clarity.