StarHub has unveiled a five-year business transformation plan that will see the Singapore telco focus on becoming a “full-on digital life” and digital services provider. It also is aiming for a further cost savings of SG$280 million ($205.54 million) and SG$220 million ($161.5 million) in gross profit growth cumulatively between 2022 and 2026.
Coining it “DARE+”, StarHub said Monday it concluded the first phase of its DARE transformation journey last month, which yielded cost savings in excess of SG$270 million ($198.2 million) and was higher than its original target of SG$210 million. It also slashed its operating expenditure by 15%.
The telco now would look to attain “sustainable revenue growth”, “potential growth” in dividends, and product margins with the introduction of 5G products and services. It also was aiming for further operating cost savings with its digital transformation efforts and migration from legacy systems.
Industry regulator Infocomm Media Development Authority has set aside S$40 million (US$29.53 million) to support research and development efforts and drive adoption of 5G, which include initiatives focused on key verticals such as urban mobility and maritime.
These efforts would drive its target of achieving SG$280 million in cost savings as well as SG$220 million in gross profit growth over its fiscal years of 2022 to 2026.
StarHub said its five-year “transformation and growth” roadmap would see the telco become a company “that connects digital lives” for customers. “DARE+ anchors on doubling down on digital across everything StarHub does, accelerating value creation, realising growth without frontiers, and delivering an endless continuum of experiences that enrich customers’ lives,” it said.
CEO Nikhil Eapen said: “StarHub is changing, going beyond telco to becoming a full-on digital life and digital services provider of the most enriching connectivity, entertainment, and other lifestyle experiences, as well as innovative business solutions for our customers, with frictionless digital engagement at our core.”
With DARE+, StarHub said it would offer over-the-top (OTT) streaming entertainment, cloud games, and digital services. For consumers, this would see the telco “meshing” its products and services into all-in-one offerings. For instance, shows and movies could be accessed on TVs, phones, tablets, and web browsers through its hybrid linear-OTT platform StarHub TV+.
It pay TV business also has been rebranded to Entertainment to encompass other complementary services, such as 5G cloud games, and new products and verticals that the telco planned to introduce in future.
In the enterprise market, StarHub pointed to plans to beef up its play in cybersecurity and the region’s ICT industry through Ensign InfoSecurity, its joint venture with Temasek Holdings, and subsidiary Strateq, as well as planned acquisitions of MyRepublic Broadband and HKBN JOS in Singapore and Malaysia.
StarHub added that it would explore further potential acquisitions to further grow its footprint, but did not specify market segments it was looking at.
The telco is the latest amongst local players to embark on a business transformation plan in recent years, following similar announcements from M1 and Singtel. All three telcos also saw leadership changes in the last three years, with StarHub’s Eapen taking on the CEO role last December, after a months-long search. Singtel’s group CEO Yuen Kuan Moon assumed his position in January this year, while M1 CEO Manjot Singh Mann took over the helm in December 2018.