Wireless broadband firm Now Telecom is slated to become country’s fourth telecommunications industry player after the National Telecommunications Commission (NTC) issued last Sept. 14 the extension of its provisional authority (PA) to operate a mobile telecommunications system.
There are now four cellular mobile telephone service (CMTS) licensees in the country: Smart Communications, Globe Telecom, Dito Telecommunity, and Now Telecom.
Now Telecom was one of the applicants of the third telco slot which was eventually awarded to Dito owned by Davao City-based businessman Dennis Uy.
Now Telecom said in a statement that the provisional authority is not specific to 3G mobile communications technology but can extend to other technologies such as 4G, 5G, or even outer space.
The PA is subject to a number of conditions, foremost of which is the infusion of an additional capital of at least P1.9 billion based from the first two years capital expenditure of P6.3 billion in the submitted rollout plan and approval by the Securities and Exchange Commission (SEC) of the increase in the authorized and paid-up capital.
It also required Now Telecom to accelerate the installation of broadband data service in the suburban and rural areas and that in each of the phases of project implementation, it shall strictly comply with the 70:30 ratio of urban to suburban and rural network rollout coverage.
The NTC order, signed by commissioner Gamaliel Cordoba and deputy commissioners Edgardo Cabarios and Delilah Deles, prohibits Now Telecom from sharing or co-using its frequency to either Smart, Globe, Dito, or any other entity without first securing approval from the agency.
In extending Now Telecom’s PA, the NTC said that based on the company’s financial position, its debt-to-equity ratio complies with the 70-30 requirement of the commission. It said its total capital requirement for five years amounts to P15.9 billion and the company has to infuse at least 30 percent of total capex requirement for two years or in the amount of P1.89 billion.
In February 22, 2018, Pres. Rodrigo Duterte signed Republic Act 10972 approving the renewal of Now Telecom’s legislative franchise for another 25 years to engage in the business of providing telecommunications throughout the Philippines and between the Philippines and other countries territories, including outer space.
As the country’s fourth telco, Now Telecom, an affiliate of publicly listed telecommunications firm Now Corp., is currently setting the stage for its public listing as well as its 5G network rollout.
Earlier, Now Telecom revealed that it plans to spend $713 million for its five-year 5G fixed wireless access business plan. The company aims to deploy the 5G FWA network in the National Capital Region and offer a broadband plan of up to 10 gigabit per second service.
Now Telecom recently appointed Unicapital Inc. as financial advisor for a planned corporate restructuring as well as exclusive issue manager and financial advisor for a planned listing by way of introduction (LBWI) in a stock exchange.
Together with its advisor, Now Telecom is also assessing the suitability of listing its shares on the local bourse or within the region, given its medium-term business plans.
“We are moving forward with the corporate restructuring of Now Telecom to take it to the next level. Now Corp. and Now Telecom were the first to introduce 5G broadband speed of up to 2Gbps direct to our existing enterprise clients. Our next move is to extend said service to the residential and consumer markets,” said Mel Velarde, who is also the Now Group founder and chief executive officer.
Now Telecom is hoping to build on its current stronghold, particularly business enterprises, highly dense residential areas, high-end residential homes, and high-rise buildings. Company officials emphasized that the telecom firm is well-positioned in the enterprise and high-end residential market in the country via 5G FWA and that with fairly limited competition in this space, there is a strong opportunity to gain a profitable market share.
It will be recalled that last year, Now Telecom signed an MOU with SK Telecom, South Korea’s largest telecom provider, to help design the company’s 5G network.
The company also inked a memorandum of understanding with Singapore-based HyalRoute Group, through local subsidiary Philippine Fiber Optic Cable Network, Ltd. (PFOCN), in connection with shared fiber infrastructure assets nationwide.
Velarde earlier noted that in all these years, the company has succeeded on the basis of a clear and highly differentiated competitive strategy by focusing on addressable and profitable target customers, and by building a wireless broadband network with cutting-edge technologies.