SINGAPORE (Reuters) – HOOQ Digital, a video streaming service majority owned by Singapore Telecommunications Ltd (Singtel), said it was filing for liquidation as it had not been able to grow sufficiently to provide sustainable returns nor cover escalating costs.
HOOQ was started as a joint venture in 2015 between Singtel, Sony Pictures Television and Warner Bros Entertainment. But it has failed to make major gains as larger rivals such as Netflix Inc expanded in the region.
“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,” a Hooq spokesperson said in a statement.
“Because of these changes, a viable business model for an independent, OTT distribution platform has become increasingly challenged. As a result, HOOQ has not been able to grow sufficiently to provide sustainable returns nor cover escalating content costs and the continuous operating costs of an independent OTT distribution platform,” the spokesperson added.
The liquidation is not expected to have any material impact on the net tangible assets or earnings per share of Singtel, the telecom operator said in a filing to the stock exchange. Singtel has an indirect 76.5% effective stake in HOOQ.
HOOQ is part of Singtel’s group digital life segment, which includes newer businesses like digital marketing that the company has been trying to grow as part of its efforts to expand outside traditional telecom services.
(Reporting by Aradhana Aravindan in Singapore; Editing by Himani Sarkar)