Globe allots $51.5M for provincial landline upgrade

MANILA, Philippines - Ayala-owned Globe Telecom Inc. has earmarked $51.5 million this year to modernize its wireline infrastructure in key areas in the central and southern parts of the country.

Robert Tan, chief technical advisor of Globe, said in a statement that the company intends to modernize its Globelines wireline infrastructure in the provinces through a four-phase project.

The project involves the change-out of old “legacy” digital line concentrators from the core switches down to the street-side cabinets with next generation network equipment providing voice and data.

“Each phase has three tracks: Productization, infrastructure and migration. Productization involves the readying of the billing system for migration, infrastructure entails the building of the new street-side cabinets and integration to the new switching system, while migration has to do with the actual movement of the subscriber connections from the old to the new ones,” Tan said.

He explained that the project is on top of the $700-million nationwide wireless modernization also currently being undertaken by the company.

“This will make our network more resilient while providing additional capacity to our subscribers. It also reduces our operating expenses after completion; power consumption and space requirements will also be minimized,” he added.

Earlier in 2010, areas in cities of Makati, Mandaluyong, Pasig and Marikina have been modernized, as part of first phase of this transformation program. Provinces which are now experiencing better landline and wired internet services are Aklan, Iloilo, Roxas, Antique, Biliran, Siquijor, Guimaras, Lanao del Norte and the islands of Negros, Leyte and Samar.

According to the company’s Network Technical Group, subscribers from the aforementioned areas have been transferred to the modernized infrastructure. Other areas that will be upgraded this year include Cavite, Batangas, Cebu and Bohol.

“This undertaking gives our customers improved network performance and a more reliable service. In terms of accessibility, it would also be easier for them to get broadband service with the new system in place,” Tan said.

Globe is spending about $650 million for its capital expenditures this year despite recording a sharp drop in net income last year as part of its ambitious network modernization and transformation program.

To fund this year’s capital expenditures, Globe chief financial officer Alberto de Larrazabal earlier said the company is looking at several fund raising activities to raise between $320 million and $350 million of the total amount.

These include the issuance of detailed peso bonds, bilateral peso loans, among others as several institutions has approached the company to act as book runners for the said fund raising activities.

According to him, Globe is looking at raising $200 million within the first quarter of the year to fund its expansion program.