Globe Telecom chief commercial officer Issa Guevarra-Cabreira (pictured) said the Philippines operator is aiming for growth through a fixed-line prepaid internet play next quarter, building on its significant fibre network expansion over the past two years.
Speaking to Developing Telecoms at the Mobile World Congress last month, the CCO said that the operator “after years of record-high capex investment to support the fast-growing usage demand of our customers and the spike in home broadband demand driven by the pandemic, we are now shifting our focus towards maximizing these investments, and central to this is the launch of prepaid broadband due to release this Q2 2023. This will extend to the relevant digital solutions and services coming out of Globe Group of Companies, foremost of which would be G-Cash (fintech/e-wallet) and Konsulta MD (health-tech).”
“We have built out a network that is meant to serve the connectivity needs of the Filipino people at a time when it needed it the most, which was the pandemic. And we are well aware that connectivity is the backbone for all the other digital services such as G-Cash and Konsulta MD, that the customers need to survive and thrive in their daily lives.” said Guevarra-Cabreira.
She explained that faster and more reliable connectivity significantly grew in demand since the pandemic, however, the industry players were only able to offer postpaid fixed broadband connectivity. The postpaid segment and its customer base remains to be a small minority in the Philippine market.
“We're saying now is the right product for the market. Our competitors actually said no, we're going to stick to our guns and stay post-paid. But post-paid is just a certain segment of the market that is now saturated.
“As early as mid-2022, we have already announced to the market that we are going to serve the prepaid fibre broadband segment via a prepaid fibre offering. At that time, the response of our competitors was to stick to their postpaid offerings.
"However, just in recent weeks, as they belatedly all realise, the right product for this market will have to be a prepaid fibre offering given the population profile, and that this is the only way to ensure that capex investments are maximised and monetised. As we saw signs of the postpaid fibre market immediately reaching saturation in early 2022”, explained Guevarra-Cabreira.
Globe counted 2.6 million home broadband customers at the end of its 2022 financial year, which is down by 30% year-on-year. Home prepaid broadband subscribers migrated more to fibre, but this did not cover a decline in legacy broadband. In Q4, Globe home broadband unit declined from PHP29.4 billion in 2021 to PHP27.1 billion.
In 2022, Globe Telecom spent PHP101.4 billion (US$1.9 billion) in capex a 9% rise year-on-year and its current peak in spending. The operator is aiming to bring capex down to US$ 1 billion by 2024.
