The number of mobile subscribers in the Philippines has continued to soar, fuelled by the availability of low cost tariffs and by investments totalling PHP1.37bn among the largest telecoms operators – Philippines Long Distance Telephone Company (PLDT), Globe Telecom and Digitel – which largely went to fund the upgrade and expansion of the country’s mobile networks. Over the first half of 2008, there were 6.62mn net additions, which beat the number of net additions in the same period of the previous year. By June 2008, there were 69.10mn subscribers with penetration rates of 77.1%, and forecast by BMI to reach 78.5% by the end of the year. Over the next five years ended 2013, rates will have risen to 154%. This will include a number of multiple SIM customers, given the range of promotions and affordable tariffs on the market.

The issue of mobile number portability (MNP) continues, with the government stating that it was indefinitely postponing plans for MNP due to the cost of the service being too high. The problem appears to arise from the prospect of routing text messages via a central hub in order to enable MNP to take place.

SMS text messaging is incredibly popular in the Philippines, with around 1.4bn messages sent every day, making this a key issue both for operators and for the regulator when considering the introduction of MNP. Further to this, leading mobile operators are threatening to increase mobile tariffs, according to reports published in October 2008. The announcement comes as the government looks to take half of revenues generated from SMS charges to fund new health and education initiatives in the country.

The delivery of mobile broadband services is seen as the next step in the provision of 3G services, with both PLDT and Globe Telecom noting significant increases in wireless broadband subscribers. PLDT’s wireless broadband service revenues rose by 50% year-on-year (y-o-y) as of H108 to PHP2bn, while Globe Telecom planned to commercially launch its wireless broadband services over a WiMAX network in Q408, with Sun Cellular (Digitel’s mobile unit) similarly launching wireless broadband over its 3G network either before the end of 2008 or in early 2009.

The cost of PCs and laptops is falling, as are tariffs, making broadband increasingly affordable. At the end of 2007, there were around 950,000 broadband subscribers, and BMI estimates that this figure rose to over 1mn to reach 1.5mn by YE08. The deployment of WiMAX networks from a number of operators in the next few years will fuel competition against the traditional broadband operators, and should contribute to stronger growth. By the end of our forecast period in 2013, we are forecasting a penetration rate of 5.5%.