Red tape gets in the way, says Globe
Bureaucratic red tape in the telecommunication sector has a price tag, and it is steep.
Globe Telecom CEO Ernest Cu said the cumbersome and expensive permitting process for building new cell sites was the reason Globe spent only about $700 million in 2015. The amount was $150 million short of its capital expenditure target of $850 million for the year.
Cu said Globe was focusing on the need to build infrastructure as it started a new next phase of network expansion, which would involve ramping up mobile and wireline networks’ capacity by 70 percent. He said this would help bring faster Internet to some two million homes by 2020.
He said Globe was prepared to engage all stakeholders, including lobbying lawmakers.
The aim is to address bottlenecks in the permitting process at the local government unit level. He said the permit process requires about 25 steps and at any given time, Globe and rival Philippine Long Distance Telephone Co. have hundreds pending applications for new cell sites. Globe also wants to lay down “thousands of kilometers” of fiber cables” and replace copper wires.
Globe has so far committed to spending $750 million this year, although Cu said the figure could go higher.
“The limitations [to spending] are not us. The limitations are the permits, the right of way, site acquisition,” Cu said.
“We want to help eliminate that label of slowest Internet. It’s something that is always the biggest elephant in the room. We are going to fix it right now,” he added.
Globe remained on expansion mode, after recording another banner year in 2015 with core profit growing by 4 percent to P15.1 billion and service revenue jumping 15 percent to P113.7 billion.
Globe said mobile subscribers alone increased by 20 percent to 52.9 million, a slice of which came from people who switched from PLDT.
Growth was driven by Internet services. Globe said mobile data service revenue jumped 55 percent to P22.1 billion while its broadband business was up 38 percent to P17.5 billion—as data-hungry smartphones become more accessible to the broader public. Miguel R. Camus
