StarHub is reshaping the way Singaporeans experience and connect with the world by stepping beyond the confines of the traditional telco and becoming a digital life enabler. In the past three years, StarHub CC3 has been delivering on its commitment to Infinity Play – venturing outside mobile and home connectivity and bringing digital experiences and services such as cloud gaming and cybersecurity products to customers. The subscriber base for this category has experienced a steady growth of 15% annually. The new verticals now contribute 20% to the y-o-y growth of the average revenue per user (ARPU) for postpaid services.
StarHub has also been revamping its mobile app to simplify purchase, account management, payment and access to support. By improving self-service capabilities, customers have greater control and better user experience. In the enterprise segment, StarHub is showing strong growth in converging connectivity, cybersecurity and cloud. It continues to create new solutions to inject innovative solutions in the enterprise mobility and connectivity service lines.
StarHub’s initiatives reflect a cohesive approach toward achieving its long-term goals under DARE+. This strategy has been a game-changer, steering StarHub towards sustainable revenue growth, improved product margins, and a continuous evolution to meet the future head-on. It has seen the company shift focus to superior 5G products, deepen digitalisation, and transition from legacy systems to more efficient and cost-effective cloud solutions.
The transition to cloud is expected to see high operating expenses (opex). The group’s opex has been increasing consecutively since the start of DARE+. In the latest 9MFY2023 ended September 2023, opex came in at $1.57 billion, 3.6% higher than 9MFY2022 and up almost 18% compared to 9MFY2021. Given the substantial investments, net profit was impacted in the early stages of DARE+, but subsequently, earnings have bounced back, and the group recorded $114.0 million in earnings for 9MFY2023, representing a 29.1% y-o-y growth. The positive result is attributed to the outcome of the DARE+ initiatives.
In 9MFY2023, StarHub’s service revenue also rose 8.2% to $1.46 billion compared to $1.35 billion in the equivalent period a year ago, exceeding the group’s guidance announced in August 2023, of being between the 3% to 5% range.
“This strategy is essentially a narrative of transformation aimed at reinforcing trust and sparking excitement about the new horizons that StarHub is steering towards,” says CEO Nikhil Eapen, whose objectives for the enterprise segment is to latch on to secular tailwinds such as cloud technology, cybersecurity and connectivity.
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The bigger picture
Three years into its DARE+ initiative, StarHub has redefined its consumer segment through a focus on digital products and platforms, recognised as the new conduits for driving customer lifetime value. In line with that, Infinity Play is StarHub's bold answer to the evolving market demands. It is an offering that encapsulates connectivity, over-the-top streaming entertainment, cloud gaming, and a plethora of digital solutions for consumers.
“The consumer segment is a big focus for us. As you know, we are transforming every part of our business, and consumer is also very much at the core of that. But now, we try to think of our consumer business less along the traditional lines than we did before,” Eapen says. “We are focused on delivering connectivity, content and leisure products.”
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Eapen emphasises on StarHub’s vision, which is to provide Singaporeans with a whole range of products to enhance their lifestyle through one app-based platform. From mobile and mobile services to over-the-top (OTT) streaming, sports and general entertainment, cloud gaming, cyber and scam protection, insurance, device support and healthcare, StarHub aims to be an a one-stop shop for consumers’ telecommunication needs and more.
“Consumers don’t have to be restricted to telco-style bundles but can build their own packages as they wish. The platform also has data to curate and suggest digital products on a personalised level to each customer. Imagine how the price and value pales in comparison to the lifestyle enrichment and safeguards that these bring,” says Eapen.
The enterprise segment, on the other hand, has witnessed a unique convergence of connectivity, cloud and cybersecurity solutions, all underpinned by network transformation and cloudification. This approach has not only solidified StarHub's core platforms but has also positioned it to pursue ambitious regional enterprise projects, expanding its footprint and influence.
Central to the DARE+ agenda is the Cloud Infinity project, a visionary leap into low-latency, secure and autonomous multi-cloud architecture. This initiative is not just about the latest technology, but also about co-creating platforms and solutions with enterprises, fostering a symbiotic relationship that drives mutual growth and innovation.
The way Eapen sees it, enterprise customers are looking to harness the power of smart cities to build use cases around robotics, AR/VR (augmented reality/ virtual reality), holograms, retail analytics and more.
However, the challenge remains to be that there is a lack of computing power for analytics and true multi-cloud options in the market. Security is also an issue, with many new attack services and security products specific to each cloud. With DARE+ through Cloud Infinity, StarHub can power smart city use cases and Network cloudification has also allowed StarHub to deploy a secure autonomous cloud network for smart city projects.
Moving forward
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As StarHub continues to drive its Infinity Play and Cloud Infinity initiatives, it leans heavily on cloud and data lake capabilities. This strategic move is expected to yield significant efficiencies, reduce the footprint and cost of legacy systems, and pave the way for businesses to embark on transformative journeys of their own.
“We want to digitise and cloudify our front- and back-end systems for significant cost savings and, more importantly, realise business benefits such as streamlining and improving the efficiencies of our business processes. Cloud will also enable us to scale our systems on-demand, which is important during major product launches and promotions,” says Eapen.
From Eapen’s perspective, the future for StarHub is one of continuous evolution, where operating models are constantly refined, regional presence is expanded, and the potential for sustainable growth and dividends is realised.
StarHub’s DARE+ transformation is more than just a strategy, it is a commitment to innovation, efficiency and growth, as well as an invitation to businesses and consumers alike to join in a journey of transformation and exploration. As StarHub continues to redefine the telecommunications landscape, it remains a beacon of innovation and a trusted partner in an ever-evolving digital world. The journey is just beginning, and the possibilities are infinite.
