With mobile telephony now already considered a mature industry (cellular penetration exceeding 80 percent), broadband Internet services are expected to be the sector’s new growth driver. According to Business Monitor International (2010), Smart and Globe continued to report strong growth in their broadband business segment. Total broadband subscribers for the two operators crossed the two and one million mark respectively, and wireless broadband take-up is the main subscriber growth driver for Smart and Globe.
It is amidst this setting of falling revenues in cellular services (an industry segment nearing maturity) but with high prospects for broadband Internet services (another segment which is still in its infancy and expected to compensate for the decline in cellular revenues) that PLDT has recently acquired Digitel. The deal would result in a duopoly with PLDT’s Smart, Talk N’Text (Piltel), Red Mobile (Cure) and Sun (Digitel) on the one hand, and Globe Telecom and TM on the other. PLDT now controls 70 percent of the total cellular subscribers while Globe controls the remaining 30 percent. Digitel has 400,000 broadband subscribers to be added to PLDT’s two million subscribers.