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Philippines - Telecoms, Mobile, Broadband and Forecasts

Published By :

BuddeComm

Published Date : Aug 2014

Category :

Broadband

No. of Pages : 147 Pages

With mobile subscriber growth moderating, the Philippines sees big shift to mobile broadband

Growth in the mobile segment of the Philippines telecom market has been moderating after years of strong expansion. Initially the slowing in the market was partly due to a general downturn in the Philippine economy; however, even as the economy picked up, it became obvious that mobile subscriber numbers were continuing to increase but at a generally slower pace. Mobile revenue growth also down in what has for many years been a highly competitive market. Into 2014 the Philippines had around 105 million mobile subscribers. Penetration, having eased past the 100% milestone, ongoing annual subscriber growth of between 5% and 10% looked to be the pattern in the short term.

Clearly the economy will be an important factor in the continued expansion of the Philippine telecom sector. Earlier on, the recession in the US, its main trading partner, had hit exports hard but the country seemed to have generally overcome this setback. Following the big ‘down’ year in 2009, the country’s GDP growth bounced back up again in 2010 reaching almost 8% (even exceeding the 31-year high of 7.3% in 2007). It then fell back to under 4% in 2011. The Philippine economy grew more strongly again in 2012 (6.8%) and again in 2013 (7.2%) on the back of an improvement in exports, acceleration in private investment, and a full recovery in government spending. Growth of 6.5% per annum was forecast by the IMF for the 2014/2015 years.

Despite mobile subscriber expansion easing, the operators were continuing to talk positively about the potential of the market. Importantly, it was the mobile segment that remained central to the wider development of the country’s telecom sector. Although the sector was facing challenges there was clearly some energy remaining in it as the major operators rolled out their 3G mobile offerings and looked for improved revenue streams. In 2012 there was also the initial launching of 4G/LTE services by both PLDT’s Smart and Globe Telecom, reflecting a general optimism in the wider telecom market.

In the meantime the most encouraging news has been the increased interest in broadband services, with the major players in the local telecom market starting to invest heavily in the expansion of broadband access and looking at both wired and wireless broadband platforms to provide coverage. The demand for faster internet access was increasing rapidly in 2012 and into 2013. Around 80% of all internet connections were already broadband. Overall broadband penetration remained relatively low, however, with only around seven broadband services for every 100 people in the country by the start of 2012. A surge in the sale of smartphones and tablets suggested increasing demand ahead for mobile data services.

The country’s fixed-line subscriber penetration has remained essentially stagnant, even suffering decline at times. It has certainly been a long period of difficulties for the fixed-line operators. Despite the concerted effort of both the government and the operators to expand the national fixed network, fixed-line teledensity stood at just over 3% in 2014; only a little more than half of all Philippine towns and cities had a basic fixed telephone service by that stage.

Key highlights

  • Growth in mobile subscribers in the Philippines has slowed by 2012/2013 but was still managing to grow at slightly less than 10% annually;
  • Mobile penetration had reached 105% coming into 2014;
  • Although growth in the SMS market had peaked, Filipinos were reported to still be sending close to two billion SMS messages every day;
  • The country remained a global leader in SMS volumes and usage levels;
  • Broadband internet access in the Philippines had witnessed a six year run of strong subscriber growth;
  • There were over seven million broadband subscribers in the country by early 2014; however, this still only represented around 7% of the population;
  • The fixed-line market had effectively lost direction, with no growth expected in the short term;
  • Local media company ABS-CBS Corp was moving quickly to become the ‘third player’ in the country’s telecom market;
  • The Philippine telecom sector continues to be an important element in the local economy, contributing over 10% to the country’s GDP.
Table of Contents

1. Key Statistics
1.1 Country overview
1.1.1 Background
1.1.2 Economy

2. Telecommunications Market
2.1 Overview
2.2 PLDT’s acquisition of Digitel
2.3 Background to development

3. Regulatory Environment
3.1 Regulatory authorities
3.1.1 National Telecommunications Commission (NTC)
3.1.2 Commission on Information and Communications Technology (CICT)
3.1.3 Proposed Department of Information and Communications Technology (DICT)
3.2 Telecom sector liberalisation
3.3 Foreign ownership
3.3.1 Court ruling on PLDT case
3.3.2 SEC issues new rules
3.4 Regulatory developments – 2012 - 2014
3.4.1 Operators faced with major compensation bills
3.4.2 Network sharing
3.4.3 Anti-cable tapping law
3.4.4 Spectrum issues
3.4.5 Globe’s use of Bayantel spectrum challenged
3.4.6 Approval of frequency sharing/transfers
3.4.7 Reallocation of spectrum blocked by court decision
3.5 Regulatory developments – 2011 and earlier
3.5.1 Interconnection
3.5.2 Release of spectrum
3.5.3 Regulator’s fees
3.5.4 Broadband speed
3.5.5 Interconnection fees

4. Major Operators
4.1 Overview
4.2 ABS-CBN aiming to be ‘third telecom player’
4.3 Philippine Long Distance Telephone Company (PLDT)
4.3.1 Overview
4.3.2 Business strategies
4.3.3 Foreign ownership issue
4.3.4 Financials
4.3.5 PLDT’s fixed-line operations
4.3.6 PLDT’s mobile operations
4.3.7 PLDT’s broadband operations
4.4 Globe Telecom
4.4.1 Overview
4.4.2 Service problems and network upgrade project
4.4.3 Financials
4.4.4 Bayantel debt buy-out and acquisition
4.4.5 Developments
4.4.6 Globe Telecom’s mobile operations
4.4.7 Globe Telecom’s fixed-line operations (Innove)
4.4.8 Globe Telecom’s broadband operations
4.5 Digitel/Sun Cellular
4.5.1 Overview
4.5.2 Digitel’s mobile operations
4.5.3 Digitel’s fixed-line operations
4.5.4 PLDT’s acquisition of Digitel
4.6 Bayantel
4.6.1 Overview
4.6.2 Operations
4.6.3 Financial difficulties
4.6.4 Globe Telecom’s buyout of Bayan
4.7 Other operators
4.7.1 Extelcom
4.7.2 Bell Telecom
4.7.3 Eastern Telecommunications Philippines Inc (ETPI)
4.7.4 PhilCom
4.7.5 NOW Telecom (Next Mobile)
4.7.6 Liberty Telecom / Wi-tribe
4.7.7 ABS-CBN
4.7.8 New licences

5. Telecommunications Infrastructure
5.1 Overview
5.2 National infrastructure
5.2.1 Overview
5.2.2 Fixed-line statistics
5.2.3 Globe Telecom’s national fixed-line licence
5.3 Background: Service Area Scheme (SAS)
5.4 National fibre optic networks
5.4.1 Background
5.4.2 Developments – 2012 / 2013
5.5 Next Generation Networks (NGNs)
5.5.1 PLDT
5.5.2 ETPI
5.6 International infrastructure
5.6.1 International gateways
5.6.2 Submarine cable networks
5.6.3 Satellite systems
5.7 Infrastructure developments
5.7.1 Wireless Local Loop (WLL)
5.7.2 Voice over Internet Protocol (VoIP)
5.7.3 Very Small Aperture Terminal (VSAT) services

6. Broadband Market
6.1 Broadband market overview
6.2 Background
6.3 Broadband and Internet statistics
6.4 Regulatory issues
6.4.1 Broadband quality
6.4.2 Minimum internet speeds
6.4.3 Hackers
6.4.4 IPv6
6.5 National Broadband Network (NBN)
6.6 PC market
6.7 Broadband platforms
6.7.1 Digital Subscriber Line (DSL)
6.7.2 Cable modem
6.7.3 Fibre to the Home (FttH)
6.7.4 Mobile broadband
6.7.5 Fourth Generation (4G) / Long Term Evolution (LTE) mobile services
6.8 Broadband over power lines
6.9 Internet market overview
6.9.1 Role of Internet in the Philippines
6.9.2 Cloud computing
6.9.3 Cybercrime legislation
6.9.4 Social networking
6.9.5 Internet exchanges
6.9.6 Internet regulations
6.9.7 E-commerce
6.10 Major broadband service providers and ISPs
6.11 Overview
6.11.1 PLDT
6.11.2 Digitel / Sun Cellular
6.11.3 GlobeNet
6.11.4 Bayantel
6.11.5 Broadband Philippines
6.11.6 Meridian
6.11.7 Philweb.com
6.11.8 EasyCall
6.12 Internet via satellite
6.13 IP networks
6.14 Voice over Internet Protocol (VoIP) services

7. Digital Media
7.1 Overview of broadcasting market in the Philippines
7.2 Market development
7.3 Regulatory developments
7.3.1 Digital TV
7.4 PLDT
7.5 Digital TV services
7.5.1 Broadband TV (IPTV)
7.5.2 Cable and pay TV
7.5.3 Free-to-Air (FTA) broadcasting
7.5.4 Satellite TV
7.5.5 Direct-to-Home (DTH) services

8. Mobile Communications
8.1 Overview of the Philippines’ mobile market
8.2 Mobile operators
8.3 Mobile statistics
8.4 Mobile ARPU
8.5 Regulatory issues
8.5.1 Sale of CURE’s spectrum
8.5.2 Globe’s mobile broadband contracts
8.5.3 Proposed fines for poor services levels
8.5.4 Compulsory SIM registration
8.5.5 Per-pulse billing dispute
8.5.6 Mobile Number Portability (MNP)
8.5.7 SMS-related issues
8.5.8 ‘Illegal’ use of frequencies
8.6 Mobile technologies
8.6.1 Third Generation (3G) mobile
8.6.2 Long Term Evolution (LTE) /Fourth Generation (4G) networks
8.6.3 Smartphones
8.6.4 AppBridge project
8.7 Mobile voice services
8.7.1 Prepaid cards
8.8 Mobile data services
8.8.1 Short Message Service (SMS)
8.8.2 Multimedia Message Service (MMS)
8.8.3 Mobile TV
8.8.4 Data Centres
8.9 Mobile content and applications
8.9.1 Overview
8.9.2 Content development
8.9.3 M-commerce

9. Forecasts
9.1 Forecasts – fixed-line market – 2015; 2020
9.2 Forecasts – Internet services – 2015; 2020
9.3 Forecasts – mobile services – 2015; 2020

List of Table

Table 1 – Country statistics – 2014
Table 2 – Telephone network statistics – 2013
Table 3 – Internet user statistics – 2013
Table 4 – Broadband statistics – 2013
Table 5 – Mobile statistics – 2013
Table 6 – National telecommunications authorities
Table 7 – Philippines’ GDP real growth rate – 2006 - 2015
Table 8 – Mobile market share - major operators – March 2013
Table 9 – Mobile market share - major operators – March 2014
Table 10 – Mobile operators, subscribers and annual change – March 2014
Table 11 – Mobile subscribers by operator – 2009 - 2012
Table 12 – Fixed lines - installed and subscribers - by operator - 2012
Table 13 – PLDT’s capital expenditure – 2008 - 2014
Table 14 – PLDT fixed-line subscribers – 2001; 2005 - 2013
Table 15 – PLDT – total mobile subscribers – 2006 - 2014
Table 16 – PLDT – mobile subscribers by operator/contract type – 2013
Table 17 – PLDT – mobile ARPU by operator/contract type – 2013
Table 18 –Smart mobile subscribers – 2010 - 2014
Table 19 – Smart – prepaid and postpaid mobile subscribers – March 2014
Table 20 – Smart – prepaid and postpaid mobile ARPU – 2013
Table 21 – Smart Communications: 3G subscribers – 2012 - 2013
Table 22 –Talk ‘N Text mobile subscribers – 2002 - 2014
Table 23 – Red Mobile (CURE) subscribers – 2009 - 2012
Table 24 – PLDT’s fixed broadband subscribers – 2011 - 2013
Table 25 – Historical - Globe Telecom mobile subscribers – 2001 - 2004
Table 26 – Globe Telecom mobile subscribers – 2005- 2014
Table 27 – Globe Telecom – mobile subscribers - prepaid v. postpaid – March 2014
Table 28 – Globe Telecom – mobile ARPU by contract type – 2013
Table 29 – Global Telecom: 3G subscribers – 2012 - 2013
Table 30 – Historical - Globe Telecom fixed-line subscribers – 2002 - 2007
Table 31 – Globe Telecom fixed-line subscribers – 2008 - 2013
Table 32 – Globe Telecom - fixed-line ARPU – 2011 - 2013
Table 33 – Globe Telecom broadband subscribers – 2006 - 2014
Table 34 – Globe Telecom broadband subscribers - wired v. wireless – March 2014
Table 35 – Digitel mobile subscribers – 2005 - 2012
Table 36 – Digitel –mobile subscribers- prepaid and postpaid – March 2012
Table 37 – Digitel fixed-line subscribers – 2001; 2007; 2010 - 2012
Table 38 – Bayantel’s fixed-line subscribers – 2000 - 2001; 2006 - 2012
Table 39 –Historical - Fixed lines in service and penetration – 1994 - 2004
Table 40 – Fixed lines in service and penetration – 2005 – 2014
Table 41 – Fixed lines – proportion of urban and residential subscribers – 2007 - 2013
Table 42 – Fixed lines installed versus lines in operation – 2005 - 2014
Table 43 – Historical - Fixed lines installed versus lines in operation – 1995 - 2004
Table 44 – Total lines installed by operator by SAS target date
Table 45 – Historical - Fixed broadband subscribers – 2001 - 2004
Table 46 - Fixed broadband subscribers - 2005 - 2014
Table 47 – Mobile broadband subscribers – 2009 - 2014
Table 48 – Mobile broadband subscribers – 2012 - 2014
Table 49 – Fixed broadband subscribers and households – 2013
Table 50 – Broadband subscribers by major service provider – 2010 - 2013
Table 51 – Historical - Internet users – 1996 - 2004
Table 52 - Internet users - 2005 - 2014
Table 53 – Historical - Internet subscribers – 1996 - 2004
Table 54 - Internet subscribers – 2005-2014
Table 55– Overview of internet market statistics – 2012
Table 56 – International internet bandwidth – 2000 - 2014
Table 57 – Percentage of households with computer – 2002 - 2014
Table 58 – Historical - DSL subscribers – 2001 - 2007
Table 59 – DSL subscribers – 2008 - 2013
Table 60 – Cable modem subscribers – 2005 - 2013
Table 61 – Historical - Number of registered ISPs – 2001 - 2007
Table 62 – Number of registered ISPs – 2008 - 2013
Table 63 – PLDT broadband subscribers – 2005 - 2014
Table 64 – Historical - PLDT’s DSL subscribers – 2001 - 2004
Table 65 – PLDT’s DSL subscribers – 2005 - 2013
Table 66 – PLDT’s total fixed broadband subscribers – 2008 - 2014
Table 67 – PLDT’s mobile broadband subscribers – 2007 - 2014
Table 68 – Smart’s wireless broadband subscribers – 2005 - 2014
Table 69 – Sun Cellular / Digitel’s broadband subscribers – 2011 - 2014
Table 70 – Globe Telecom’s broadband subscribers – 2007 - 2014
Table 71 – Globe Telecom’s DSL subscribers – 2009 - 2014
Table 72 – Globe Telecom’s wireless subscribers – 2009 - 2014
Table 73 – Key broadcasting statistics - 2013
Table 74 – Historical - Total mobile subscribers and penetration rate –1994 - 2004
Table 75 – Total mobile subscribers and penetration rate –2005 - 2014
Table 76 – 3G mobile subscribers – 2012 – 2013
Table 77 – Mobile market share - major operators – March 2014
Table 78 – Historical - Mobile services revenue – 1993 - 2004
Table 79 – Mobile services revenue – 2005 - 2013
Table 80 – Total SMS messages – 2003 - 2012
Table 81 – Forecast fixed line subscribers – 2015; 2020
Table 82 – Forecast Internet subscribers – 2015; 2020
Table 83 – Forecast mobile subscribers – 2015; 2020

List of Chart

Chart 1 - Fixed line operators - market share - 2012
Chart 2 - Fixed lines in service and annual change - 2005 – 2014
Chart 3 - Fixed broadband subscribers - 2006 – 2014
Chart 4 - Mobile broadband subscribers - 2009 - 2014
Chart 5 - Broadband subscribers by major service provider - 2010 – 2013
Chart 6 – PLDT’s broadband subscribers - 2008 - 2014
Chart 7 - Globe Telecom’s broadband subscribers - 2009 - 2014
Chart 8 - Total mobile subscribers and annual growth - 2005 – 2014
Chart 9 - Mobile market share - major operators – 2014
Exhibit 1 – Major submarine cables with landing points in the Philippines - 2013

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