The New Zealand Herald

Singapore's 139-year-old Telecom has plans for millennial­s

- — Bloomberg

Singapore Telecommun­ications was around back when the telegraph was still cool.

Now the 139-year-old company is experiment­ing with video games as a way to raise its profile with millennial­s.

The telecom giant has announced it plans to start a competitiv­e gaming league and will eventually sponsor its own team.

E-sports may already be big business in markets ranging from the US to China, but it’s going to be bigger.

Goldman Sachs Group estimates global sales will reach US$3 billion ($4.4b) annually by 2022, with an audience that rivals the current viewership of the National Football League in the US.

The foray into gaming is the brainchild of Arthur Lang, the former Morgan Stanley banker who took over Singtel’s internatio­nal operations last April, looking to diversify from traditiona­l businesses where competitio­n is toughening.

City regulators in 2016 granted a fourth telecom license to rival TPG Telecom and streaming services like Netflix are pulling viewers away from Singtel’s television channels.

“Singtel needs to find something beyond the pure carrier business,”

said Sachin Mittal, an analyst at DBS Group Holdings. “I think they’re moving in the right direction, but the gestation period for these new businesses is long.”

To remake itself, Singtel has bought cyber security and digital marketing businesses, but it still gets about 76 per cent of its sales from telecom services. The shares have lost more than a quarter of their value

since their 2015 peak, although they’ve had a bounce in the last week as investors snapped up defensive shares amid trade-war jitters.

Lang, 46, said he doesn’t play video games, but in an interview he laid out a rationale for the new venture.

“This is really an effort to engage our customers,” he said.

E-sports are becoming mainstream and will draw in millennial­s, who make up most of the region’s 600 million subscriber­s, he said.

Lang started making moves soon after coming over from property developer CapitaLand, where he was chief financial officer.

In November, he signed a deal that made Singtel the only provider in Asia offering Razer’s gaming smartphone at retail stores.

In March, he announced a plan to connect all of Singtel’s mobile wallet services in a single network, so customers can to use their phones to make payments at shops just about anywhere in Southeast Asia.

“I knew after even a month of visiting these companies, there was something we had to do,” Lang said, referring to Singtel’s subsidiari­es in Indonesia, Philippine­s, Thailand and India. “If we want to target the millennial customer, how we can engage them more is really talking about new content.”

One model for the gaming plan came from South Korea, where SK Telecom has been using e-sports as a marketing tool for years, sponsoring a team that dominates play in “League of Legends,” a game that last year attracted 58 million viewers for its world finals.

Singtel is starting its gaming push by holding its first regional e-sports championsh­ip in early October at Singapore’s Suntec convention centre, with the event broadcast on its channels and partner platforms.

The company plans to sell 3000 tickets for the three-day tournament.

Players will compete for a prize pool of US$300,000 and games will include Tencent Holdings’ “Honour of Kings,” Valve Corp’s “Dota 2,” and Activision Blizzard’s “Hearthston­e”. The plan is to add more tournament­s each year.

Singtel also said it will recruiting a team to represent Singapore in internatio­nal competitio­ns, such as the 2022 Asian Games in Hangzhou, China, where gaming will be a medal sport along with swimming, soccer, and track and field events.

Lang declined to say how much money Singtel had budgeted for the project, but he currently has nine employees working to get the business off the ground.

“Customers today don’t treat their mobile phones as just a communicat­ion device, they look at their mobile phones as an entertainm­ent device,” he said.

“If we telcos don’t do anything about it, I think we’ll just be sidelined.”

 ?? Photo / Bloomberg ?? Singtel says the move is to engage its customers.
Photo / Bloomberg Singtel says the move is to engage its customers.

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