Globe to heed Duterte order, but says challenges remain for telco industry

Ayala-led Globe Telecom Inc. on Monday acknowledged threats of President Rodrigo Duterte to improve its services else be shut down, as it said billions of dollars worth of investments are now paying off.

"We heed the call of the President to improve telco services," it said in a statement following Duterte's State of the Nation Address (SONA).

In his SONA, Duterte threatened incumbent telco players to improve their services by December else have their properties expropriated, and be shut down.

He specifically mentioned Globe, as well as its biggest rival Smart Communications Inc., as he said he would find a way to work with Congress to have them out of the industry should they fail to improve.

In response, Globe said it has earmarked $1.2-billion for its capital spending this year, mainly to finance its network and capacity builds.

"These substantial investments are paying off as we experience marked service improvements," it said.

"Service performance and increased consumer demand for data are the key reasons why we have been investing billions of dollars to upgrade and improve our network," it added.

Globe also noted its upcoming launch of mobile fifth-generation 5G services in the country, with its network currently running at 4G/LTE.

In the same statement, Globe noted that challenges remain, such as securing the necessary permits to put up cellular sites which would in turn boost its signal.

"We express our optimism that the recently signed Joint Memorandum Circular 01 s.2020 spearheaded by the DICT with other national agencies to fast track builds of telco towers will finally lead the way to a more robust connectivity in the country and provide internet services to every Filipino," it said.

It was referring to the government's common tower policy, whose guidelines were released by the Department of Information and Communications Technology (DICT) last month.

The planned common tower policy seeks to free telecommunications companies from costly capital expenditures in building communication towers.

Both Globe and Smart will compete with Dito Telecommunity Corp., which is backed by Davao-based businessman Dennis Uy, who supported Duterte's presidential bid in 2016.

The Dito consortium is made up of Uy's Udenna Corporation, Udenna's subsidiary Chelsea Logistics Holdings Inc., and Chinese state-owned China Telecommunications Corporation.

Dito failed to meet its first-year commitments on the July 8 deadline under its Certificate of Public Convenience and Necessity (CPCN), but was given six more months by the National Telecommunications Commission (NTC) to fulfill this.

The company earlier this month said it is on track to commercially launch by March 2021. —LDF, GMA News