As a result of the telco’s recent decision to cut 300 of its employees, hence downsizing its workforce by about 12%, UOB is estimating a 7.5% reduction in staff costs for 2019.
In a Friday report, analyst Jonathan Koh says he suspects StarHub could be engaged in talks with TPG Singapore and M1 on the possible sharing of radio access network (RAN), as well as with NetLink NBN Trust for sharing of back-haul transmission.
While the details have yet to be finalised, StarHub aims to reach a commercial agreement on network sharing by 2019 – a strategic move which Koh supports as it is inefficient to have four duplicated 5G networks, in his view.
“Network quality has also become less of a differentiating factor. By collaborating, both companies benefit from the expanded coverage and capacity of a single shared infrastructure. According to Ericsson, network sharing reduces site requirements by 30-40%. For network sharing that encompasses new coverage, additional capacity and network modernisation, the savings in capex is 20-30%,” says the analyst.
Shares in Starhub were trading 2 cents lower at $1.94, or 7.52 times FY18F book, prior to the midday trading break.
