Daily news - 23 Sep

SingTel makes bigger IT services play
Singapore Telecommunications is hoping to increase sales from its business segment by moving from basic offerings such as selling Internet connectivity to providing higher- margin, outsourced infocomm services to corporations. According to SingTel's executive vice-president Bill Chang, the company is looking to double revenues from its ICT (infocomm technology) portfolio within the next five years and have them account for half of its business unit sales. 'Two years ago, we had almost zero ICT revenue,' Mr Chang told reporters at a briefing yesterday. SingTel's Singapore operations registered sales of $4.9 billion for the last financial year. Revenue from providing data and Internet services accounted for more than $1 billion of the total figure and the business segment was a key contributor, he said. The company has historically focused on providing basic Internet and data services such as selling access packages to businesses. However, a combination of thinning margins from its consumer business and a growing trend among companies to consolidate their technology supplier base has prompted SingTel to move higher up the corporate technology value chain. With its new business mantra, SingTel will expand its technology partnerships and develop more 'one-stop' ICT offerings for different business sectors. And instead of being the main selling point, the firm's infrastructural services such as Internet connectivity will now be bundled as part of the overall ICT service package.

SIA says premium-class travel 'relatively strong'
Singapore Airlines, which gets 40 per cent of revenue from business passengers, said the credit crisis in the US has not hurt demand for premium-class travel. Demand from business travellers in the US remains 'relatively strong', spokesman Stephen Forshaw said in an e-mail reply to Bloomberg queries. Leisure traffic has declined recently for Asia's most profitable carrier and the airline may alter its route network in response, he said. Economic turmoil and record fuel prices have eroded profits at Asia-Pacific airlines, forcing Qantas Airways, Thai Airways International and Korean Air Lines to cut routes. With the credit crisis in the US deepening and financial institutions cutting at least 125,000 jobs, demand for premium-class travel may wane, an airline grouping official said.

Source: Kim Eng