SEC approves Globe’s incorporation of tower-holding company

GLOBE Telecom Inc. has received the approval of the Securities and Exchange Commission (SEC) for the incorporation of its tower-holding company called GTowers Inc.

With the said approval, the company can now start to “operationalize the divestment of all or part of its tower assets” to the said tower company.

Ernest L. Cu, the company’s president, has said the tower holding firm was set up to allow any player to lease the towers using standard, nondiscriminatory commercial terms.

Globe officials have been floating the idea of establishing tower companies similar to those found in developed countries for several years now, noting the lack of cellular towers in the Philippines.

Based on a study made by TowerXchange, an independent community for operators, tower companies, investors and suppliers interested in emerging-market telecom towers, the Philippines lags behind its neighbors in Asia when it comes to cell-site build.

The number of unique physical cell sites in the Philippines is one of the lowest in Asia, with a combined 16,300 cell sites. Demand for cellular towers in the country is pegged at 70,000 sites.

China has the highest number with 1.18 million cell sites, followed by India with 450,000 and Indonesia with 76,477 cell sites. Vietnam has 55,000, Thailand with 52,483, Pakistan with 28,000, Bangladesh with 27,000 and Malaysia with 22,000 sites.

With 113 million mobile subscribers and only a combined total of 16,300 towers from PLDT Inc. and Globe servicing them, the Philippines has the lowest tower density score in Asia, with a meager 0.14 to Asia’s current giant China’s 1.43.

The government is in the process of crafting an official policy on common tower usage in the Philippines.

Under the said policy, the government intends to award two tower companies with licenses to build and operate common towers.

The two companies will be required to erect 25,000 towers each—for a total of 50,000 towers—over a period of seven years for $2 billion each.

Based on the preliminary guidelines released by the government on Thursday, two independent entities will have to build 25,000 towers each until the first half of 2027.

For the first year, each company shall build 1,000 towers on the first year; 2,000 for the second; 3,000 on the third; 4,000 on the fourth and 5,000 for the fifth to seventh years.

The government’s common tower initiative is a much-needed policy that is expected to dramatically improve telco services in the Philippines.

Having common towers—infrastructure where radio transmitters are housed—allows for a faster expansion and modernization of the rapidly changing telco infrastructure and technologies.

Aside from Globe, Isoc Holdings Inc. is interested in setting up common towers in the Philippines. It has submitted a P100-billion unsolicited proposal to the Department of Information and Communications Technology  for the creation of 25,000 common towers across the country.

This is the first unsolicited proposal the department received since it was created about two years ago.

As it is an unsolicited offer, the proposal will have to go through several approval processes and a Swiss challenge.

 

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Sources regularly see Lorenz at telco and transport conferences. He graduated from the University of Santo Tomas, and has been covering the beat since 2013. He likes to featurize stories, and tries to find another angle for spot news. He travels during his spare time, and likes his coffee black -- no cream, no sugar.