Telcos seek support to boost broadband services
THE Philippine broadband market is expanding beyond the perceived duopoly, but there is a need for increased support to enhance service efficiency and reduce costs, according to industry players.
Globe Chief Sustainability and Corporate Communications Officer Maria Yolanda C. Crisanto responded to a recent World Bank study characterizing the market as an “effective duopoly with two large telcos,” saying that the ‘duopoly’ label “disregards certain players that have already made a dent in the market.”
“Looking at revenue data it cited, the study inaccurately compared Globe’s total 2022 revenues of P158 billion with a pure broadband competitor’s P34 billion. This fails to take into account that Globe offers a full suite of services including mobile, broadband, and a host of digital solutions from its non-telco business,” she said in an e-mail.
The World Bank study said that “Globe and PLDT Inc./Smart are vertically integrated.”
“They own international connectivity, backbone, middle- and last- mile networks and have the majority subscriber share. Over 500 providers acting as retailers rely on wholesale infrastructure, either from the duopoly or market challengers,” it noted.
The government should promote procompetition policy reforms and encourage investments to help enhance broadband infrastructure and narrow the digital divide in the country, the study also said.
The study cited data showing that in 2022, PLDT’s revenues reached P205 billion, Globe recorded P175 billion, and Converge ICT Solutions, Inc. earned just P34 billion.
Ms. Crisanto noted that Globe’s broadband revenue alone in 2022 was P27.1 billion.
For its part, the PLDT group highlighted its commitment to enhancing services despite challenges.
“Amid macroeconomic challenges and heightened competition in the telco landscape in the Philippines, PLDT and its wireless arm Smart Communications, Inc. remain steadfast in their commitment to support the steady rise in network traffic and deliver leveled-up services to their customers nationwide,” the group said in a statement.
This is achieved through “continuously investing in enhancing and expanding the Group’s integrated fixed and wireless networks, enabling improved customer experience,” it added.
As of end- September, PLDT’s fiber infrastructure is at over 1.1 million kilometers and supports some 6.15 million fiber ports, covering 18,000 barangays nationwide. Meanwhile, Smart’s mobile network covers 97% of the country’s population with 3G, 4G/ LTE and 5G services, it added.
In September, Globe also announced that it had built about 356 new 5G sites, which resulted in 5G outdoor coverage of 97.44% in the National Capital Region and 91% in parts of Visayas and Mindanao.
“Both firms are the market leaders in the broadband sector, but it does not mean that they can effectively control the market and regulatory environment in the sector,” Terry L. Ridon, a public investment analyst and convenor of InfraWatch PH, said in an e-mail.
“Converge has been implementing its own growth strategy despite the market leadership of both Globe and PLDT/Smart,” he added.
Meanwhile, Ms. Crisanto said that Globe supports the World Bank’s call for further support from the government to “address infrastructure challenges inhibiting the equitable delivery of connectivity across the country.”
“Telcos have been relentlessly investing in infrastructure, including capex- intensive submarine cables to link the islands across the archipelago and reach underserved areas. But with over 100 million people to connect, telcos cannot do it alone,” she said.
PLDT said it is also a primary challenge for Philippine telcos to keep products affordable and maintain a network across the archipelago.
“The PLDT group continues to optimize its network striving to make its operations more efficient, in order to keep leveling up the experience of customers while at the same time offering value-for-money fixed broadband and wireless products and services,” it added.
World Bank data showed that among Association of Southeast Asian Nations (ASEAN), the Philippines is the least favorable on policy environment for affordable broadband and is among the slowest in the world in promoting reforms to make it more affordable.