MVP sees no showdown yet with 3rd telco

Industry giant PLDT Inc. downplayed the immediate threat of a new major telco player a day after a provisional contender was named by the National Telecommunications Commission (NTC).

PLDT chair and CEO Manuel V. Pangilinan told reporters on Thursday it could take years for a new challenger to roll out its mobile service.

“Our sense is the third player will likely focus on the mobile side of the business,” Pangilinan said, adding that the company had a significant presence in its fixed-line internet business.

“Our view is the impact of a third player will not be significant in the first year,” he added.

A consortium led by businessman Dennis Uy’s Udenna Corp. and China Telecom, China’s third largest telco, was named the provisional third player by the NTC on Wednesday.

Fitch Ratings on Thursday said competitive pressures would “temper revenue growth and raise the [capital spending] pressure” for PLDT and main rival Globe Telecom.

“The severity of the threat from a new entrant is unclear at this stage, though government intervention may be needed to accelerate industry reforms to raise competition,” Fitch Ratings said.

Pangilinan shared his views as PLDT reported a modest gain in core earnings during the nine months through September this year on the back of gains in its wireless, home and enterprise segments.

PLDT said core profit from January to September this year hit P18.86 billion, up 4 percent compared to the same period in 2017. Its service revenue amounted to P109 billion, up 2 percent.

PLDT cited gains across its traditionally strong home and enterprise segments. Its wireless segment, once a drag for the company as subscribers transitioned to data services, rose 8 percent in the third quarter alone. For the nine-month period, it was up 4 percent to P45.5 billion.

“The wireless business will complete its turnaround this year,” said Oscar Enrico A. Reyes Jr., PLDT senior vice president of consumer business market development.

PLDT, which attributed the gain to the near-doubling of data traffic, in part due to its partnership with YouTube, said this was the fourth consecutive quarter of growth for the wireless unit.

Meanwhile, PLDT said its home and broadband segments accounted for 59 percent of total revenues. Total capital spending this year was on track to hit P58 billion.