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Why Globe Telecom partnered with Facebook

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Globe Telecom partners with Internet companies such as Facebook to stay relevant.

When profit began declining in 2008 after peaking a year earlier as traditional call and SMS revenues stagnated, when people stopped sending text messages and became obsessed with Facebook and Viber, a dangerous atmosphere for a telco in the Philippines, which used to be known as the 'texting capital of the world, Globe changed its business stragegy.

Globe evolved from a telecom operator into a communication services provider that understands and responds to the needs of its subscribers in the digital age.

“We chose to re-orient our focus to customer above all else,” Globe Telecom president and chief executive Ernest Cu says.

The transformation of Globe’s focus from utility concept to service/customer concept, along with introduction of innovative ideas, arrested months of market share loss, says Cu.

“Customer-centricity became our number one mantle,” says Cu.  “We simplified our vision—happy customers, happy employees and happy shareholders.”

Globe also the digital age and decided to work with over-the-top players and instant messaging applications, instead of competing against them.

“We were the first partners of Facebook in the Philippines. Through them, we gained a lot of digital market share. We also partnered with Viber and WhatsApp. We have to embrace the OTT players.  They are gonna come and get you anyway.  You better use them to your advantage,” says Cu.

Globe modernized its network, replacing the base infrastructure with digital technology through a $700-million investment.  It changed the format of its stores and tapped the interactive solutions of Amdocs, a US company that provides software and services to telcos around the world.

In a span of seven years, Globe grew its postpaid subscriber base from 700,000 to 2.4 million, while simultaneously expanding the prepaid base. “Today, we are now the top mobile brand in the Philippines,” says Cu.

Globe earned a record profit of P13.4 billion in 2014 from service revenues of P99 billion.  This continued in the first quarter of 2015, when net income surged 43 percent to P4.2 billion, as service revenues climbed 13 percent to P26.2 billion, on the back of a 31-percent gain in broadband business.

“We have built a new Globe in sync with the customers,” says Cu, adding that the company is now one of the most in demand stocks in the Philippines, with a 63-percent gain since the start of 2015.  It currently has a market capitalization of $7.8 billion.

Cu says amid declining SMS revenues, Globe decided to broaden its product offering to include digital entertainment, in partnership with the likes of Disney and Marvel Studios.

“We consider Globe now to be the purveyor of Filipino digital lifestyle. We actually have a chance to shape an emerging lifestyle in the Philippines,” he says.

Cu says Globe continues to innovate, as it taps Amdocs to bring more features that will excite subscribers.  He says one of the projects with Amdocs is to eliminate “bill shock” among subscribers, adding that the technology is on the way.

Globe earlier signed a seven-year agreement with Amdocs for the transformation and management of its business support systems and enterprise data warehouse.

Telecom executives agree that digital age is around the corner and telcos need to evolve with the changing times.  

 

 

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