Globe Telecom is sustaining its level of capital expenditure (capex) this year, with $850 million approved by its board of directors, consistent with last year’s capex figure, the telco disclosed the other day.
Its 2018 capex is aligned with the telco’s vision to enable the Philippines to have first world Internet connectivity.
Globe continues to expand its data network and address the surge in customer demand for on-demand video content, said its President and CEO Ernest Cu.
“Majority of our 2018 capex is geared to meet customer demand for more bandwidth-intensive content, which, in turn, will support the revenue momentum of our data-related services,” he explained.
Globe has progressively increased its capex spending since 2015, averaging 31 percent annually on a capex to revenue ratio basis. Using the annualized year-to-date September 2017 revenues, and the full year 2017 guidance of $850 million capex, full year 2017 capex to revenue ratio would be nearly 34 percent.
“We continue to be efficient in our network build, evidenced by the superiority of our mobile network, in terms of higher 3G and LTE availability both on a regional and nationwide basis,” he elaborated, noting that for the first nine months of 2016 and 2017, Globe mobile data network carried over 2.4x the traffic of competition.
Capital spending for the year would finance the company’s commitment to provide fast Internet service to two million homes by 2020. A good portion of the company’s capex will also be used for deploying massive MIMO technology to expand and enhance its Long-Term Evolution (LTE) network.
The MIMO technology enables a mobile network to multiply the capacity of a wireless connection without requiring more antennas, increases wireless throughput, accommodating more users at higher data rates with better reliability while consuming less power.
In the case of home broadband, speed and range benefits of MIMO technology allows customers to have reliable data connection especially since more and more customers are now using video streaming services.
Source: https://business.mb.com.ph/2018/01/07/globe-telecom-sets-850-m-capex-for-2018/