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9 Key Insights From StarHub Ltd’s Management Team From Its Latest Annual Report

Telecommunications outfit StarHub Ltd  (SGX: CC3) had released its latest annual report a few months ago.

The report, which is is a great place to learn more about the telco, included a section with comments made by members of StarHub’s senior management team. I had managed to pick out some interesting insights from there.

For the first three insights involving changes in StarHub’s management team and business landscape, click here. The next three insights were about StarHub’s efforts to bring its business up to another level – they can be found here. Here’re the other three key insights that I noted.

Infrastructure is key

“[Chief Commercial Officer Kelvin Lim:] As infrastructure is key to all services, we continue to roll out our fibre network island-wide, over and above the Next Gen NBN, to provide critical connectivity solutions for greater diversity. We have also invested in a low latency solution to serve the financial sector both domestically and in the region.

As enterprise mobility becomes a key component of a company’s strategy, our mobile network has been enhanced to provide outdoor and indoor coverage with 3G to LTE-Advanced technologies.”

StarHub sees a larger addressable market in the enterprise space when compared to its consumer business.

In 2015, StarHub’s Fixed Network segment (now known as Enterprise Fixed Services) accounted for 16% of its overall revenue. The segment’s contribution could move higher in the future and could become the largest piece over time. Building the necessary infrastructure to support its future growth could be the key here.

Lim also mentioned that the Fixed Network segment is leading in the hospitality sector where StarHub serves 90% of businesses.

Software is eating infrastructure

“[Chief Technology Officer Mock Pak Lum:] The Fixed Network is going through a transformation towards software defined architecture and more of our network functions are being virtualised.

This will provide faster time-to-market for new enterprise offerings and eventually lead to a reduction in CAPEX [capital expenditure] and OPEX [operating expenditure] as we complete the transformation in the next two years.”

StarHub is also looking to software to improve its network solutions. The move might have business benefits (faster time to market) and financial benefits too (lower expenditure).

One Hub to rule them all 

“[CTO Mock Pack Lum:] STT MediaHub will be StarHub’s convergence hub for our fixed, mobile and pay TV networks. We are building a state-of-the-art TV headend which will incorporate virtualised play-out and a fully IP-enabled delivery backbone. This will put StarHub in a good position as we navigate the changing media business landscape.”

Starhub’s strategic shareholder, ST Telemedia (STT), took a 70% stake in StarHub’s MediaHub in July last year. The move provides relief to StarHub’s capital expenditure needs and leverages STT’s data centre growth.

The STT MediaHub will play multiple roles including supporting StarHub’s enterprise customer needs, housing innovation and incubation teams, and providing carrier-grade data centre facilities.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn't own shares in any company mentioned.