Fitch Ratings Inc. (Fitch) has predicted intense competition in the country’s telecommunication (telco) industry as Philippine Long Distance Telephone (PLDT) and Globe Telecommunications Inc. (Globe) are set to pursue aggressive expansion programs and increase their capital expenditures (capex). “We believe domestic competition will further intensify in the next year due to PLDT’s aggressive strategy to acquire market share as it affirmed Globe’s long-term foreign and local-currency issuer default ratings at BBB,” Fitch said. Fitch said Globe’s robust expansion into long-term evolution (LTE) will keep its capex/revenue ratio elevated at 27 percent to 28 percent in 2016-2018. Under a three-year network deployment plan, both telcos aim to accelerate network expansion, broadband infrastructure, and internet access coverage to cover over 90 percent of the country’s cities and municipalities by 2018. Oyson expects a rebound in the telcos’ stocks since they can now move forward with their planned capex to improve service.

Source: Manila Times September 17, 2016 10:30 UTC