It uses music as an unconventional approach to grow its subscriber base.
The
company had tied up with Universal Music Malaysia to provide digital
music content as part of XOX’s plans to reward its subscribers. With the
launch of the ONEMUSIC Edition Starter Pack, XOX mobile telephone
subscribers will have access to digital music and music showcases.
XOX started moving into entertainment in early 2016 through a partnership with a renowned concert management company.
Besides
delivering previews of music albums, Universal Music’s role is also to
help XOX increase its subscriber base, through the distribution of the
starter pack.
Observers are positive of XOX using music as a tool to secure more subscribers as it is an unconventional method indeed.
Its
CEO said XOX subscribers have grown 54.5% in the past one year (Till
March 2017). Its total subscribers grew from 1.1 million early 2016 to
1.7 million. XOX plans to reach two million subscribers in 2017. Reportedly, XOX was targeting to hit the two million mark in 2016. It missed that target which has since been changed to 2017.
For
the six months ended Dec 31, XOX’s operating profit margin fell to 2.3%
from 5.6% a year ago. The lower margins will curb these players from
slashing their rates further. XOX, for instance, saw higher selling and
distribution expenses as well as other expenses in the six months ended
Dec 31.
The
company plunged into the red with a net loss of RM773,000 from a net
profit of RM860,000 a year ago. Earnings were impacted by the net
impairment loss of RM3 mil on other investment.
However,
the company saw better revenue in H1FY17 to RM102.68mil from RM72.78
mil a year ago, mainly due to the enlarged subscriber base driven by
continued intensive marketing activities on branding and promotional
products offerings.
XOX’s
result is a prime example of its on-going and vigorous promotions.
XOX’s selling and distribution costs and other expenses accounted for
27% of H1FY16’s revenue before shooting up to over 33% in H1FY17.
If
not for the various aggressive promotions which the company has held,
the company wouldn’t have recorded such high revenue [growth] in the
first place. The high percentage of expenses to revenue will continue to
increase.
XOX needs to find a balance between achieving high revenue and ensuring profitability.
On
the rising costs, XOX will be rationalising other costs and any savings
will be channelled to this new digital music strategy.
XOX
has been listed on Bursa Malaysia since 2011. The company provides
mobile telecommunication services for the young, technology-savvy and
general customers.
XOX
has been offering telecommunication services to the public since 2005
and was assigned the mobile number prefix “010” by the Malaysian
Communications and Multimedia Commission (MCMC).
It
is a mobile virtual network operator that provides mobile phone services
via Celcom’s 4G+,4G, 3G and 2G network infrastructure.
Its
current (March 2017) total subscribers stood at about 1.7 million, with
the bulk of them being prepaid users. XOX’s postpaid users are at around
15,000 as the service.
XOX’s
market share in the local mobile telco market is about 4% of the 44
million telco subscribers as at Q3. In terms of the prepaid market, XOX
has a 5% share.
'Dislike' - XOX (Still Struggling For Growing Subscriber Base) ...
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