StarHub CEO, who stormed in with job cuts, wants cheaper network

StarHub CEO, who stormed in with job cuts, wants cheaper network

By: 
Bloomberg
15/10/18, 11:06 am

(Oct 15): StarHub Chief Executive Officer Peter Kaliaropoulos said the company, Singapore’s No. 2 telephone carrier, is looking to pare costs even further by sharing infrastructure after announcing he would trim the company’s workforce by about 12%.

The city-state’s No 2 telecommunications company may reach a commercial agreement on network sharing in 2019 or earlier, Kaliaropoulos, who joined as chief executive officer in July, said in an Oct 11 interview. Financial benefits could be seen by the end of next year, he said.

“We’re talking to a lot of people,” Kaliaropoulos said. “When an industry hits maturity, you need to start sharing facilities.”

The company and smaller competitor M1 said in January last year that they would study further collaboration in mobile infrastructure sharing that could lead to lower spending. Kaliaropoulos, who took over as CEO in July, announced 300 job cuts earlier this month as part of a broader plan to save $210 million over three years from 2019.

Once an upstart third entrant itself, StarHub is seeing mobile subscribers dwindle amid price competition ahead of the entrance of a fourth player, TPG Telecom. At the same time, StarHub’s model of offering users access to films, television and broadband services, is being challenged by streaming powerhouses like Netflix Inc.

StarHub needs to be “a bit more lean, a bit more agile” and channel more resources to growth areas such as its enterprise business, Kaliaropoulos said.

The company’s enterprise, or corporate services, business has been growing about 20 percent a year and will probably make up more than half of total revenue within two years, compared with 40% now, he said.

Along with cutting costs and arresting the slide in subscribers, Kaliaropoulos must also win back support from investors, who’ve pushed the shares down 52% since July 2015, knocking $3.6 billion off the company’s market value.

With more mobile phones than people, Singapore’s telecommunications market is just 0.4% the size of China’s, which has only three carriers. Regulators in the island state have sought to introduce more competition to bring down phone bills and improve services.

Four mobile carriers may be too many, said Kaliaropoulos, who said it may be difficult for the smallest to survive.

Kaliaropoulos, who built a reputation as a turnaround executive by leading mobile operator Zain Saudi Arabia to its first quarterly profit since the company was founded in 2008, said StarHub could begin to look for growth only after “stabilising” its position in Singapore as the No 2 provider.

“The next couple of years is to focus predominantly in Singapore, and be a very strong, clear challenger, a clear No 2, and once we weather the storm, we do look at other opportunities,” he said.

Living it up

SINGAPORE (Mar 25): This is the season for indices. On March 20, Singapore was ranked 34th in the World Happiness Index — less happy than Taiwan, but far more cheery than Hong Kong and China, as well as its neighbours, Thailand, Malaysia and Indonesia. Globally, the Scandinavian and north European cities top the index; and New Zealand, Canada and Austria round out the top 10. The index this year focuses on happiness and the community, taking into account how happiness has evolved over the years, as affected by technology, social norms, conflicts and government policies. A week earlier, th....
Read More >>

The charismatic bankrupt who allegedly pulled the strings behind Singapore's largest stock manipulation scandal

SINGAPORE (Mar 26): Garbed in purple overalls, John Soh Chee Wen cuts a relaxed figure as he takes his seat. The garment falls fittingly on his athletic frame, not unlike a designer suit. It could well have made a fashion statement, save for the word "prisoner" emblazoned in white across the back. As his legal team huddled around him before the start of the trial, the 60-year-old is a picture of calm. At one point, he casually flashes a thumbs up at his lead counsel, N Sreenivasan, a managing director and senior counsel at Straits Law LLP. Then, as he turns back to his seat in the dock, ....
Read More >>

OCBC still bullish on banking stocks after a lacklustre FY18

SINGAPORE (Mar 26): OCBC Investment Research remains bullish on Singapore’s banking space while keeping its sector “overweight” with “buy” calls on both DBS and UOB, which have been given fair value estimates of $29.31 and $28.30, respectively. Both stocks had dividend yields of 4.8%, with DBS and UOB trading at the respective book values of 1.3 times and 1.1 times, or at an average of 1.2 times historical book as at the close of Wednesday. In a Tuesday report, OCBC analyst Carmen Lee notes that raising this average to 1.3 times book and factoring a 10% premium for DBS over the....
Read More >>