Globe spends, makes money on mobile data phenomenon

Chrisee Dela Paz

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Globe spends, makes money on mobile data phenomenon
Globe says it needs to adjust its plans to accommodate a key market shift – the mobile data revolution

MANILA, Philippines – As mobile data’s strong growth continues to be impressive, Globe Telecom, Incorporated expects to sustain its annual investment of $700 million to $750 million in the next 3 years.

This is to fill the infrastructure gap needed for fast-growing mobile data usage, Globe chief finance officer Rizza Maniego-Eala told reporters in a briefing in Taguig on Wednesday, February 10.

“It’s a comfortable amount where we are capacitized to support the growth with or without competition… We plan to spend around the same amount, $750 million, to support the growth in mobile data,” Maniego-Eala said.

In a separate disclosure to the local bourse, Globe announced that its capital spending budget for 2016 will be around $700 million to $750 million. 

This includes investments for deploying long-term evolution (LTE), increased network capacities and coverage, and modernization of fixed line and data infrastructure.

Data from Globe Telecom disclosure

Riding the wave

Globe’s net income in 2015 grew by 23% to P16.5 billion ($347.77 million) from P13.4 billion ($282.43 million) in 2014.

“It was a really good year for Globe. The momentum is such that we are really looking forward to a good 2016,” Maniego-Eala said.

Globe’s mobile data revenue accounts for the biggest pie of its service revenues, increasing by 55% to P22.12 billion ($466.21 million) in 2015 from a year ago.

“On all fronts, one is obviously fortifying the mobile business – which is data. The next for us is to serve the data needs of the home,” Maniego-Eala said.

According to the Globe official, mobile data represents the strongest revenue growth opportunity for operators, especially since the traditional voice business continues to decline.

READY. Globe's Rizza Maniego-Eala says her telco is ready for the mobile data revolution. Photo by Chrisee Dela Paz/Rappler

“To be honest, we have to update our 3-year plan and we just started with 2016 as our base. We have to go through a few more alterations… As the market changes, we have to build that all into consideration,” Maniego-Eala said.

With the increasing demand for mobile data, she noted that Globe has to build more cell sites.

The Ayala-led telco currently has a total of 28,336 base stations, with over 18,300 for 4G, to support the service requirements of its subscribers.

Globe’s mobile subscriber base in 2015 reached 52.9 million or 20% higher than those in 2014.

For the coming years, Globe is preparing for the intense competition in the local telco industry.

“We are concerned about competitors and it is not about PLDT (Philippine Long Distance Telephone Company) and Telstra (Corporation),” Maniego-Eala said. 

“Everybody wants a share of the Filipinos’ wallet. We have international competitors. We also have to be a bit schizophrenic on that end. [W]e have to secure more partners, as long as we have the same values. It’s a win-win situation for us.” – Rappler.com

$1 = P47.46

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