Singapore’s StarHub has announced plans to cut around 300 jobs and pursue other cost-cutting measures as part of a plan to respond to intense competition and shrinking core telecoms revenues.
The strategic transformation plan will also see the operator invest in growing new digital businesses such as its recently created cyber-security company Ensign InfoSecurity, in the development of ICT solutions for enterprise customers, and in digitalization initiatives aimed at improving the customer experience.
StarHub’s planned headcount reductions will concentrate on non-customer facing functions, the operator revealed. The company also plans to make additional roles redundant through natural attrition and tighter management of contractor roles.
Affected employees will be notified by no later than the end of the month. StarHub will take a $25 million one-off charge to fund restructuring costs including the provision of support for laid off employees.
Through the headcount reductions and planned improved operational efficiencies, StarHub aims to generate S$210 million ($152.1 million) in savings over the three years from 2019.
The operator is targeting savings in areas including procurement activities, leasing costs, maintenance and sales and distribution expenses, but plans to funnel a portion of these savings into the investments in new growth areas.
“The intense competitive ferocity right across the market, new entrants, lower voice revenues, thinning margins for fixed broadband services, high content costs for Pay TV operations and high market penetration for mobile and fixed services, has necessitated efficiency optimization initiatives as part of the strategic transformation plan,” StarHub CEO Peter Kaliaropoulos said.
“Technological innovation and competition are redefining how we deliver services to our customers and we at StarHub need to transform our operating model, otherwise we will face greater risks in the future. Our revised operating structure will be best placed to meet our strategic intent, enhance customer experience, increase accountability and effectiveness and improve competitiveness and agility.”