"Global and local content providers are increasingly going direct, the cost of content remains high, and emerging-market consumers' willingness to pay has increased only gradually amid an increasing array of choices," Hooq said.
"These are permanent structural changes that will not be alleviated even as more people turn to digital entertainment options while staying home amid the Covid-19 outbreak," a company spokesman told The Business Times . Although its FY19 revenue more than doubled to US$21.9 million from US$10 million a year ago, Hooq still sank deeper into the red with a pre-tax loss of US$62.5 million for the year, widening from the US$56.6 million loss in FY18, ACRA records show.
DBS Group Research analyst Sachin Mittal found it"a bit surprising" that Singtel has given up on the OTT space, as the telco had wanted to capture growth in the market in Asia. Janice Chong, Fitch Ratings' director of Asia-Pacific corporate ratings, told BT the OTT business is challenging amid"intense competition" in video-streaming services, significant content investment required and the lack of ability to monetise content for telcos. Other players in the OTT space include Viu, iFlix and Catchplay.
Fitch's Ms Chong said there is an"intensifying" need for the telco to turn around its digital life segment, due to challenging growth prospects in Singtel's home markets and impending 5G capital expenditure which are both putting pressure on the group's cash flows.
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