Fiber optic internet will buttress the growth of the telecommunication sector, according to Colfinancial.com.
Because of this, telco companies may post a combined service revenue of P395.9 billion this year, up 8.2 percent from last year’s projected revenues, Colfinancial said.
“Although this is slower compared to the 9.5 percent growth projected for 2021, we remain bullish on the broadband segment as stable internet access has become a necessity under the new normal,” it added.
Fiber expansion is seen to be ramped up in underserved market.
As of end November 2021, the Philippines’ fixed broadband penetration rate was at 20 percent of all households, a significant improvement from 12 percent as of end-2020, Colfinancial.com said.
“However, this is still much lower than the 40 percent average of its Southeast Asian peers.
This highlights how the country remains largely underserved with broadband operators still having a lot of room for growth,” it said.
“This year, we expect more households to connect to fiber broadband networks given the need for stable high-speed internet connection to accomplish daily activities,” Colfinancial.com added.
The growth in fiber optic internet connection is expected to boost telcos’ fixed broadband revenues in the sector, forecast to grow to P174.3 billion, up 12.3 percent.
Colfinancial.com said revenues from wireless are also expected to pick up as people become more mobile amid looser quarantine restrictions and higher vaccination rates.
“Mobility is expected to improve this year as the economy continues to reopen. However, surges, such as the one caused by the Omicron variant, could lead to temporary tightening of restrictions, hampering the speed of wireless revenue growth,” Colfinancial.com said.
“While the new stay-at-home lifestyle could bring broadband data usage to new heights, this change has delayed the recovery of the wireless segments of telcos. Nonetheless, we expect the recovery of this segment to be driven by the gradual increase in nationwide vaccination rates towards herd immunity,” it added.
