With a vast population that is expected to hit 109 million by the end of 2019, the Philippines consists of more than 20 million households. However, less than four million of these are connected to the Internet through broadband, most of which are still relying on a copper cable system.
While telco giants Globe Telecom and Smart Communications address the deficiency through mobile Internet, consumers are still experiencing network congestion as there are only around 16,500 cell sites available to serve the country’s more than 115 million mobile phone subscribers. The country needs at least 100,000 cell sites so that subscribers could get better mobile service.
Helping in addressing the communications infrastructure and connection problems in the country, Converge ICT, a service provider of various IT products and solutions, is rolling out to consumers a fast broadband service based on pure fiber technology. The company now has more than 200,000 subscribers.
Taking into account that a huge number of households in the Philippines are dissatisfied with their broadband connection, Jesus Romero, COO of Converge ICT, is seeing an enormous opportunity. “In terms of broadband, the market is really underserved. It is better to focus on something that is growing and underserved, rather than trying to kill each other in a mature market where nobody wins,” said Romero.
Converge ICT is a 27-year old company that started in 1992. It has witnessed important technological milestones that had happened over the years, for example, the shift to digital from analog and coaxial. The company was among the first to digitize cable infrastructure, allowing them to offer digital TV and Internet connectivity. It is also the first to launch GPON and FTTX.
Converge ICT owns a subsidiary that does the construction of its infrastructure, differentiating the company from other service providers or telcos that would typically subcontract. The subsidiary has machines that implement horizontal directional drilling (HDD) for building the backbone and microtrenching for laying the fiber cable.
While the traditional way of building a fiber network is open trench which is very disruptive and would take one lane of the road, HDD and microtrenching are both non-disruptive. For microtrenching, the machines are just as wide as a person and come with a big wheel that can dig two-inch wide trenches. In these trenches pass microducts that contain 1,000 fibers. The machines can do up to two kilometers of trench in an asphalt road in one day. If the road is concrete, the process would take much longer.
Converge ICT’s existing backbone in Metro Manila begins in Valenzuela down to Muntinlupa. The company is in the process of penetrating the municipality of Pateros. Outside Metro Manila, Converge ICT has already reached Baguio in the north and the Bicol region in the southern portion of Luzon. The company is aiming to connect Luzon, Visayas, and Mindanao through a subsea cable system. Converge ICT’s CAPEX to operate nationwide for five years is USD 1.8 billion.
By providing a fast, reliable fiber-based Internet connection, Romero believes that Converge ICT is not only helping the broadband sector but also the mobile network. “We are actually helping the mobile network. How? When you are on fixed broadband, you should not use your mobile connection at home. Mobile connection should be used when you are mobile or on the move. If home users are still competing at the same capacity on the mobile network, it impacts the mobile experience of those who are outside their homes,” he said
“When people start getting fixed broadband from us for home, we remove them from the mobile network. Hence, the mobile network gets less congested. In a nutshell, we are helping the entire industry by deloading the mobile network,” Romero concluded.