SingTel, StarHub – BT

SingTel tells StarHub: thanks, but no thanks

Offer on set-top boxes has come 3 years too late, it says to its rival

StarHub’s idea for getting around the inconvenience of multiple set-top boxes appears to have been shot down hours before it tabled a formal proposal to arch rival Singapore Telecom.

Having invested millions in its own Internet television network for pay-TV, SingTel’s prerogative is to recoup this investment, SingTel Singapore CEO Allen Lew said yesterday morning, hours before StarHub finally submitted an official offer to carry SingTel’s pay TV content.

‘Three years ago when we entered the pay-TV market, we had the option of either building a new network or using the incumbent’s (StarHub’s) network,’ he said.

‘At that time, there was no proposal from them and no ability to use their network. The offer is kind of three years too late. Having built the network, I have to recover the investment.’

Mr Lew was responding to comments by StarHub’s outgoing chief Terry Clontz that network sharing could be a way around the need for two pay-TV set-top boxes.

The issue came up after SingTel outbid StarHub to score the sought-after broadcast rights for the next three seasons of the English Premier League (EPL).

Besides winning the coveted league, SingTel also convinced ESPN Star Sports to migrate from cable to its mio TV platform.

Viewers flooded newspapers and online forums with complaints of having to contend with multiple set tops to view entertainment and sports content from next year.

Local authorities are already looking into the possibility of standardisation, but StarHub believes its idea could be an interim solution.

Under the green camp’s mooted approach, StarHub and SingTel’s content could be carried via each other’s networks but consumers would still pay the respective companies for their subscriptions.

This means StarHub customers could watch SingTel content such as EPL matches using their existing cable TV set-top box.

Similarly, SingTel’s mio TV subscribers could access StarHub channels such as Discovery and AXN under the arrangement.

One drawback of this scenario is that unlike SingTel’s mio TV set-top, StarHub’s cable TV box is not NBN (national broadband network)-compatible, SingTel’s Mr Lew said.

This means that it cannot receive television programmes delivered via the upcoming nationwide fibre optic network.

Consumers will have to upgrade their StarHub set-top boxes when the NBN becomes progressively operational from the first quarter of 2010, he said.

In any event, SingTel did not receive official word from StarHub until yesterday, Mr Lew said.

‘I find it very strange that our competitor would make a commercial proposal through the press,’ he said. ‘If someone is serious about doing something, they approach the other party first,’ Mr Lew told reporters at SingTel’s second-quarter results briefing.

Singapore’s largest telco yesterday posted a second straight quarterly bottomline improvement, with net profit rising 10.1 per cent to $956 million on a strong showing across Singapore, Australia and Indonesia.

Earnings per share for the three months ended Sept 30 jumped 10.1 per cent to six cents, while revenue increased 5.4 per cent to $4.1 billion.

Net profit from Singapore operations fell 9 per cent to $321 million while that from Australian unit Optus soared 21.4 per cent to $184 million.

Pre-tax earnings from SingTel’s six regional affiliates grew 32 per cent to $571 million.

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