HOOQ was launched in 2015 by Singtel and minority investors Warner Brothers and Sony Pictures Television. But like a parent pulling financial support for an errant teenager, Singtel no longer had the appetite to bankroll HOOQ and stem losses for a business that failed to win significant market share across Southeast Asia.
“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,” HOOQ said in a statement.
The business doubled annual revenue to US$21.9 million as of March 2019, but losses grew to US$62.5 million from US$56.6 million a year prior. After five years—not to mention, the current period of increased difficulty—enough was enough.
Singtel is not alone in calling time; founding partners Sony and Warner already did so some time ago. The duo last put money into the business in January 2017, and even that was only the minimum agreed amount.
Regulatory filings show HOOQ received a total of US$127.2 million in capital—mostly from Singtel. The operator initially owned 65% of the business with the studios taking a 17.5% share each, but Singtel’s ownership climbed to 76.5% at the time of the liquidation.
HOOQ launched with a US$95 million funding commitment—across an initial $70 million and a further US$25 million—but Singtel continued to foot the bill, making two investments in 2018. And it may have spent more—HOOQ’s annual financial report shows it accumulated $220 million in aggregate losses as of March 2019.
Representatives from Singtel and HOOQ did not respond to a question about the company’s total funding.
A costly production
Two Asia-based media executives told us that Singtel’s total spend surpassed $250 million, with one estimating it was as much as $350 million. We were unable to locate additional filings to show Singtel invested more than $127.2 million.
‘A million stories for a billion people’ was HOOQ’s tagline, but the business fizzled out long before it ever got close to that target.
The overly-protective parent
In stark contrast to rival iflix—which struggled to build a business whilst relying on investors for capital—Singtel, the lynchpin of the venture, shouldered the blame for many of HOOQ’s failings.
The HOOQ staff was supposed to get their own office, but the business never left Singtel’s headquarters building on Singapore’s Exeter Road. A detail symbolic of HOOQ’s struggle to own its voice and fate beyond being a part of Singtel, said three former employees. Those who worked at HOOQ enjoyed the job, five HOOQ employees said, but, to others looking in, the business was more a division of Singtel than a startup.
“It felt too corporate and not like a bunch of people hustling,” said the founder of a startup that worked with HOOQ. “There were lots of people from the telco business who I feel didn’t help build an innovative product or culture. It didn’t feel scrappy.”