Fixed Wireless Access in the Philippines: A Case of Rapid Growth to Rapid Decline?

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3Q 2023 | IN-7040

After initially focusing on the rollout of Fixed Wireless Access (FWA) services in the Philippines, Communication Service Providers (CSPs) have switched to developing other forms of broadband connectivity. This ABI Insight discusses the potential reasons why FWA might be declining, the implications of that, and the potential takeaways for the Philippines in the future.

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Fixed Wireless Access Is Declining at a Rapid Rate in the Philippines


The Philippines is experiencing a shakedown of its Fixed Wireless Access (FWA) services, which is expected to continue declining through the next four quarters. The drastic increase in subscribers in 2019, during the initial push for FWA connectivity, followed by a decrease from 2021 onward suggests a shifting market scene for the country. At its peak in 2Q 2021, the Philippines had an estimated number of 4.3 million users accessing broadband through FWA.

In the 1Q 2023 financial reports from Globe Telecom and Smart Communications (owned by PLDT), however, both Communication Service Providers (CSPs) reported continued decline in their FWA subscribers. Globe Telecom reported a 1.2 million subscriber base for its fixed wireless services, a decline from 2.4 million subscriber base in 1Q 2022. Meanwhile, its fixed wired business grew to 1.1 million subscribers, up from 1 million subscribers in 1Q 2022. Similarly, Smart Communications also experienced a decrease in fixed wireless broadband subscribers between 1Q 2022 and 1Q 2023, citing a drop from 0.95 million subscribers to 0.70 million subscribers. Its fixed line broadband user base, however, saw an increase in subscribers from 3.1 million to 3.3 million within the same period.

New Trends and Alternatives Are Shaking up the Broadband Connectivity Scene


The Philippines is an exemplar case study for FWA services due to its geography. The Philippines is an archipelago, with more than 7,000 islands making up the entire country. Given the geographical challenges, launching fiber reliably across every island has been problematic. Furthermore, CSPs may be less incentivized to deploy fiber in areas with low population density, low Average Revenue per User (ARPU) areas due to complex deployment conditions, and long Return on Investment (ROI) periods.

The discussion that surrounds the decline of FWA services in the Philippines can be structured around three potential factors: 1) the selling of tower assets by CSPs to fund 5G growth; 2) the increased adoption of fiber in the country; and 3) alternative connectivity solutions like Satellite Communications (SatCom) for broadband connectivity on the rise.

In late 2022, Globe Telecom announced the sale of 7,059 network towers for ~US$1.84 billion (PHP111 billion), which was used to finance capital investments in the network, cover maturing debts, and pay out special dividends to shareholders. At the same time, Smart Communications (PLDT) sold 5,907 of its telecommunication towers for ~US$1.5 billion (PHP77 billion). Selling tower assets in the Philippines will enable CSPs to cut costs, as tower operations and maintenance will be handed to Independent Tower Companies (ITCs), which have the necessary expertise in tower operations, and CSPs can use the immediate capital gains to invest in their networks. Around the Asia-Pacific region, this strategy appears to be the trend. For example, Singtel Group sold a 70% stake in Australia Tower Network (ATN) in 2021 to fund its 5G rollout, expand its technology services unit, and facilitate other growth projects. Telstra in Australia also sold 49% of its tower business in June 2021 to improve the coverage and capacity of its network. Ultimately, the sale of network towers will impact the telcos’ capability to provide FWA services and may be considered a factor affecting the decline of FWA subscriptions in the Philippines.

At the same time, fixed line broadband connectivity is picking up in the Philippines as fiber connectivity is being rolled out throughout the islands. Considering that fiber provides more reliable connectivity than FWA, this shift from FWA to fiber is not entirely unexpected. For instance, Globe Telecom launched GFiber Prepaid in June 2022, the country’s first affordable fully digital home prepaid fiber Wi-Fi experience. GFiber was Globe’s strategy for transitioning out of FWA and reducing the digital divide. By offering a service that is prepaid and, therefore, on demand with no lock-in period, it is working to connect the unconnected in an attractive and different way. This, in addition to the increase of fiber accessibility across the country, has been boosting the country’s connectivity.

Furthermore, companies like Starlink and Astranis entering the Internet Service Provider (ISP) market in the Philippines and offering an alternative option for broadband connectivity is another factor to consider for the shift away from FWA services. The geography of the Philippines provides an ideal case for SatCom. This being said, satellite broadband in the Philippines is still a newer alternative to broadband connectivity and, therefore, an expensive option for consumers compared to the prepaid fiber and FWA. It may take a while for satellite broadband connectivity to pick up significantly throughout the country.

Will Continued 5G Development and Growth in the Philippines Be Good Enough to Retain FWA Services?


As of 2022, the Philippines has a broadband connectivity rate of approximately 68%, short of the Southeast Asian region’s average of 88%. Alongside this, the Filipino telecommunication market is known by its fierce competition and highly regulated market. The duopoly of Globe Telecom and Smart Communications (owned by PLDT) has remained for the past 20 years, despite the latest third entrant in 2020 (DITO Telecommunity). Furthermore, with the launch of 5G and the accelerated adoption of FWA in 2019 and the  recent focus of Millimeter Wave (mmWave) spectrum for 5G, it will be interesting to see where and if 5G FWA will find itself in the market as 5G penetration increases in the Philippines. The first 5G mmWave test in the Philippines is yet to take place, though 5G mmWave might be the key to sustaining FWA services in the country. The country may look toward Indonesia’s Telkomsel, which is gearing up to roll out 5G mmWave FWA services following its first successful test of mmWave for FWA with Ericsson and Qualcomm in February 2023.

As covered in a previous ABI Insight, “Philippines: The Future 5G Growth Market in ASEAN,” the Philippines is anticipated to be a future 5G growth market in the Southeast Asian region. Despite 5G growth being faster in the Philippines than Indonesia, the country lags behind Thailand. In terms of 5G value-added services, Globe Telecom launched 5G FWA in 2019, while Smart Communications launched its prepaid Home Wi-Fi 5G at the end of 2021. Thus, it is evident that there is increased demand for better connectivity in the Philippines. There is also an additional factor of more disposable income for consumers to spend on additional value-added services, citing the increasing Gross Domestic Product (GDP) growth and lowering unemployment rate in the country. Nevertheless, it is crucial that the government works to improve the broadband connectivity rate. Recent consumer behaviors that account for the pivot away from FWA services in the past 2 years suggest that the country is perhaps shifting its focus toward alternatives to reduce the digital divide. Consequently, CSPs should continue to work closely with regulatory bodies to build reliable and resilient networks by improving network infrastructure and expanding network capacity through cable system partnerships. The government may also consider lowering barriers to entry to allow independent Internet service providers to enter the market in the long term. In this manner, the government may decide to actively stay in touch with the industry to understand the potential of broadband connectivity to connect the unconnected in the Philippines. This awareness will form the basis of informed decisions on the best technologies to tap into.

What can the government/policymakers do about the decline in FWA in the Philippines? Given the increased demand for better connectivity in the country, telcos should work closely with regulatory bodies to build reliable and resilient networks by improving network infrastructure and expanding the network capacity through cable system partnerships. In the long term, this may open gateways for the Philippines to invest in data centers for the country to meet the demands of a well-connected country.



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