PLDT pushes ‘digital pivot’ amid market uncertainties
Telco giant Philippine Long Distance Telephone Co. held its annual meeting Tuesday, months before it turns 88 years old, an event that underscored its enormous growth through the decades and fierce new challenges as it undergoes a multi-year “transformation” to survive in the digital future.
Looming large over the event were uncertainties over its recent joint acquisition with rival Globe Telecom of San Miguel Corp.’s telco unit for P69.1 billion.
PLDT and Globe wanted SMC’s valuable, unused, radio frequencies to bolster their Internet services— the segment delivering most of the new growth and profits.
However, PLDT and Globe were facing opposition from the newly-created Philippine Competition Commission, which questioned the manner in which they were informed about the deal.
The powerful PLDT-Globe telco duopoly built up the importance of the acquisition since it was revealed on May 30.
Officials Tuesday sought to calm shareholders, noting the deal was standing on solid legal ground and that it was not anti-competitive.
“We are planning on the basis that it will be resolved,” PLDT chair and CEO Manuel V. Pangilinan told reporters at the sidelines of the meeting.
“At the end of the day, we are one with everyone and we want to improve Internet services and you need added spectrum,” he added.
Pangilinan, earlier in the meeting, addressed shareholders in a candid talk about PDLT’s painful shift from its legacy business and its prospects moving forward.
“The journey to that digital future will be long, and the climb steep. There will be false starts, there will be speed bumps, there will surely be mistakes made,” Pangilinan told shareholders.
Some of these plans involved marketing changes. PLDT launched new corporate logos and changed its corporate name to just “PLDT,” dropping the “Long Distance Telephone,” reflecting the ending of that era as digital services led by explosive smart phone usage expand.
Its capital spending has ramped up beyond traditional ratios to P43 billion in 2016, similar to the level in 2015. The SMC deal would add another $100 million for 2016.
“This capex spend reflects a massive effort to transform our networks into the country’s most extensive and data capable infrastructure,” Pangilinan said.
He said the ongoing transformation that started last year would take until 2018. Pangilinan said there were early results, as the loss of subscribers to Globe had been “arrested” in recent months.
“Whilst our digital pivot has only just started and the impediments to our success remain significant, we are already seeing the first returns on our investment,” Pangilinan said.
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