Telco

Telco: Intense competition for the three telcos over the weekend at Comex further reaffirms the increased competition in the industry.

The slashing of broadband rates was the headline, with the new providers- MyRepublic and ViewQwest cutting subscription rates to grab market share, which would ultimately lead to lower broadband rates going forward.

The cable TV segment is also seeing headwinds, with the two new competitors pushing with IPTV and VPN-free services such as NetFlix and Hulu, giving devices with free subscription for a minimum 12-month period.

CLSA expects the most hard-pressed telco among the three incumbents would be Starhub, given that most of its revenues are from the two highly penetrated segments.

House maintains its Underperform ratings on both Starhub (TP: $3.61), & M1 (TP: $2.93), and Outperform on SingTel (S$4.39).