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Telecoms in Philippines hope for better year 

Jan 05. 2017
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THE PHILIPPINES’ two telecommunications players are bracing for more challenges in 2017 after a year full of surprises that included the end of San Miguel Corp’s telecom ambitions.


The transition from services like traditional calls and texting to Internet-powered apps and social media, otherwise called the digital shift, accelerated in 2016, as consumer preferences changed and as data-hungry smartphones became cheaper.

This remained an area where both PLDT Inc and Globe Telecom were fighting for customers, but are currently split almost evenly in terms of mobile subscriber count.

But adding a new layer of uncertainty – and margin pressure – was the election of President Rodrigo Duterte, who assumed office on June 30, 2016.

His constant calls for better and cheaper services have had a direct influence on price declines on the mobile side of the business, industry observers noted.

Duterte’s threat was to open up the industry to more foreign players – a situation that PLDT and Globe, which count foreign telecoms as shareholders, and even ratings agencies agreed would crimp earnings further.

Both PLDT and Globe are also setting aside larger capital spending sums, a trend seen to continue in the near term. In 2016, they spent about US$1 billion (Bt35 billion) each mainly to upgrade network infrastructure to meet the increasing demands of consumers.


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