PH needs more investments to lower internet cost —research firm

The Philippines needs more investments to improve its internet connectivity and bring down its cost, according to international research organization BMI Research.

“By extensively co-financing last-mile area rollout, wholesale network providers and internet service providers may be encouraged to further decrease prices on fiber bundles though at the expense of average revenue per user figures,” BMI said.

“Renewed government efforts to fiberize the Philippines’ last-mile areas will be beneficial for the players with a large risk-seeking stance. Regardless, wider digital transformation ambitions and the attractiveness of the Philippines’ ICT market are set to benefit from a stronger nationwide backbone and last-mile network density,” it added.

Citing a 2024 World Bank report, BMI said the Philippines has the most expensive internet connectivity among Southeast Asian countries, but is relatively slow compared to Singapore, Thailand, Malaysia, Vietnam, and Brunei.

BMI, a unit of the Fitch Group, said adding more cell sites will help increase the internet speed in the Philippines as data from the National Telecommunications Commission noted that the Philippines only has 23,000 cell sites while Vietnam and Bangladesh have 90,000 and 30,000 cell sites, respectively.

Data from the Asian Development Bank also showed that the Philippines needs an additional 60,000 cell sites in isolated and disadvantaged areas or remote areas by 2031.

MBI also said according to a 2023 study by international consulting firm Arthur D. Little, the Philippines ranked second in the lowest cumulative investments in fiber coverage and target among Southeast Asian countries.

The study further noted that the Philippines needs to spend around $1.1 billion to reach the required target coverage levels, as the country has the second lowest take-up rate and penetration rate among internet users in 2022.

Indonesia allocated $23.2 billion for its 2014-2019 broadband plan, of which 10% was shouldered by its government, while Vietnam allotted $820 million of investment for its 23,000 kilometer system submarine cable.

Singapore, on the other hand, 60% of its $2.44 billion ICT infrastructures and digital services budget this year were allocated for the modernization and improvement of its digital infrastructures.

Earlier this month, the National Economic and Development Authority approved the P16.1 billion budget for the Philippine Digital Infrastructure Project, which aims to enhance the country’s broadband activity and bring high-speed internet connection, especially in far-flung areas.

NEDA also approved the adjustments of nine ongoing infrastructures concerning enhancing internet connectivity.

These adjustments involve the project scope, cost, extension of the implementation period, and loan validity.—Mariel Celine Serquiña/AOL, GMA Integrated News