THE warning signs were everywhere in 2005. When Sun Cellular crashed into the Philippine market with unlimited text and call packages, it didn’t just disrupt pricing-it announced the beginning of the end for telecommunications as Filipinos had known it for a century.
At the dawn of the millennium, pager companies vanished almost overnight. Trunk radio operators shut down. Small provincial telephone companies that had enjoyed comfortable local monopolies found themselves unable to compete with mobile networks and quietly closed shop.
Just a decade later, Sun Cellular itself – the disruptor – was absorbed by PLDT Inc., swallowed whole for P74 billion.
The Philippine telecommunications industry over the past 20 years is littered with such corporate corpses. It is a sector where technological change moved faster than any regulator could manage and where survival demanded constant, exhausting reinvention.
Those who hesitated died. Those who adapted became something entirely different from what they started as.
Call them ‘techcos’
Today, the companies that survived don’t even call themselves telecommunications companies anymore. They are ‘digital solutions platforms’ and ‘technology companies’ – ‘techcos’ as they put it – that happen to own networks.
They make more money from fiber-to-the-home broadband than legacy mobile services, operate artificial intelligence-ready data centers, and control payment platforms used by tens of millions.
The transformation happened so completely that industry executives now speak casually about a future where traditional connectivity is merely one component of vast digital ecosystems.
The lesson, repeated like a mantra by survivors: adapt or die. Follow the money or join the graveyard.
Technology as executioner
‘IT is technology-the development of technology,’ said Edgardo Cabarios, former Deputy Commissioner of the National Telecommunications Commission (NTC), explaining what truly drove the industry’s transformation. ‘You cannot legislate and regulate technology.’
While debates raged and regulators issued guidelines, technology itself was rewriting the rules, outpacing policies. The shift from telegraph to telephone took decades. The displacement of landlines by mobile took years. But the subsequent waves of disruption-from voice to data, from 2G to 3 G to 4G to 5G, from copper to fiber-arrived with accelerating velocity.
‘Many entities died because of mobile technology, and it keeps on developing,’ Cabarios recalls. ‘Those that remained are the ones that adapted.’
But even the survivors had to transform repeatedly.
PLDT and Globe Telecom Inc., which dominated the market through the 2000s with their supposed duopoly, were making enormous profits from simple text messages and voice calls. But when Sun Cellular came up with unlimited packages in 2005, the economics shifted overnight.
‘The margins were pretty high at one peso per text, and we became the texting capital of the world- those were the heydays,’ said Eric Alberto, who, out of retirement from PLDT, joined third player Dito Telecommunity Corp. as CEO. ‘The Gokongweis really disrupted the talk and text by coming up with unlimited packages.’
The competitive threat forced PLDT to acquire Sun in 2011, but by then, a more fundamental shift was underway. Smartphones were proliferating. Mobile internet was emerging. And Filipinos were discovering that they could send messages for free through Facebook,
WhatsApp, and other ‘over-the-top’ services that bypassed traditional SMS.
The cash cows were dying. The telcos needed new revenue streams, urgently.
Following the money trails
TWO decades ago, voice calls and SMS dominated telecommunications revenue. Today, they barely register.
Based on the latest financial data, legacy mobile services barely account for a percentage of the total revenues of the major telcos.
The pivot to data began tentatively in the late 2000s with 3G technology, but accelerated dramatically with 4G and fiber-to-the-home deployments. Globe’s decision to offer free Facebook access in 2013 proved transformative, helping it claw back market share while simultaneously training an entire nation to consume data voraciously.
‘With 3G, you saw a shift in the mobile business,’ Alberto said. ‘But the advent of 3G came also with the evolution of devices.’
The greener pastures of growth, however, were in fiber – both for homes and businesses. In fact, the telcos’ broadband revenues are growing much faster than mobile, although mobile is still king.
Dennis Anthony Uy, CEO of Converge ICT Solutions, had understood this earlier than most. He spent years experimenting with coaxial cable broadband in Pampanga in the 1990s and started offering pure fiber connectivity to enterprises in Clark in the early 2000s.
When he founded Converge in 2007, building a nationwide fiber network seemed like a huge ambition. But Uy was following the money into the future.
‘We see fixed broadband as a necessity, a mainstay, of the connectivity landscape. As I’ve been saying for decades, when it comes to quality and speed of internet connectivity, as well as providing unlimited capacity, wired fiber broadband is still the best.
‘This is why we’re focused on growing not just our consumer business but our enterprise unit as well, because businesses, perhaps even more than homes, need this high-capacity connection,’ Uy said.
His bet paid off. The company’s subscriber base has exploded from just over half a million in 2019 to 2.82 million households by mid-2025, with its network now reaching 17 million homes-nearly two-thirds of all households in the country.
The incumbents followed, investing tens of billions of pesos in fiber infrastructure. PLDT now operates over one million kilometers of fiber across the Philippines. Globe accelerated its rollout during the pandemic, when work-from-home and distance learning made broadband internet essential rather than optional.
But even fiber, the telcos realized, wouldn’t be enough.
Adapt or die
The fundamental problem facing telecommunications companies by the mid-2010s was existential: connectivity itself was becoming commoditized, margins were compressing, and competition was intensifying.
The real profits were flowing to the companies that owned the services running on top of the networks-Facebook, Google, Netflix, Spotify.
If telcos wanted to survive, they needed to own more of the value chain. They needed to become technology companies.
Globe moved aggressively into fintech, transforming a modest 2004 mobile wallet called GCash – originally intended for mobile load top-ups -into a financial services behemoth now used by eight out of 10 Filipinos.
‘The realization came when customer needs were moving beyond connectivity, with payments, online safety, data security, all pain points waiting to be solved,’ explained Carl Cruz, Globe’s President. ‘At the same time, returns were shifting to platforms and intelligence layered on the network.’
The company created 917Ventures, a venture builder that spawned e-commerce platforms, telehealth, pet care services, and advertising technology companies. It launched Kickstart Ventures to fund frontier technologies. Globe partnered with global brands like Spotify, Netflix, and Disney to become what executives call ‘the purveyor of the Philippine digital lifestyle.’
‘What’s changed is that we’ve gone from selling SIMs to solving everyday problems and pioneering new technologies. From owning everything to partnering intelligently,’ Cruz said.
PLDT’s path
PLDT took a different path, though with similar logic. Aside from launching its own digital financial services platform Maya, the company invested massively in data centers, culminating in the launch of Vitro Sta. Rosa, billed as the country’s first hyperscale, AI-ready data center.
The strategic vision was clear: control the entire digital value chain from submarine cables connecting the Philippines to the world, through the fiber backbone, to the data centers where cloud services and AI workloads run.
‘Data centers are at the core of PLDT’s future as a technology company,’ PLDT wrote in written responses. ‘They complete the digital ecosystem we’ve been building.’
The industry, Cabarios said, has learned a harsh but valuable lesson: in telecommunications, standing still means death.
Third player disruption
BY 2017, the Philippines’ telecommunications duopoly had become some sort of a political liability. Former President Rodrigo Duterte publicly criticized Globe and PLDT for poor service quality, threatening to invite foreign competitors if they didn’t improve.
Back then, Internet speeds remained among the slowest in Southeast Asia despite high costs. Coverage gaps persisted across much of the archipelago. Customer dissatisfaction was widespread.
The government’s solution was to issue a new major telecommunications franchise to a third player: Dito, which launched with aggressive ‘commitments’ for both coverage and speed – 84 percent population coverage with 55 Mbps of average speeds within its first five years.
When Dito entered the market in 2019, download speeds that had languished at 10.55 Mbps suddenly jumped to 58.83 Mbps in 2025.
Per-gigabyte costs also dropped from about $1.42 per GB of data in 2019 to about $0.59 in 2024. The threat of a credible third player forced Smart and Globe to accelerate network investments and improve service quality.
‘Dito’s entry was a real inflection point in the industry,’ Dito Chief Revenue Officer Adel Tamano said. ‘If there’s any success that we can claim, it’s that we really changed the market for the consumers’ benefit.’
Yet Dito’s journey has been challenging. The pandemic delayed its full market entry, and the company has yet to post a profit. Dito’s subscriber base, while growing, remains far smaller than the incumbents.
Even as a new entrant unburdened by legacy systems, Dito recognizes it cannot escape the same economic pressures pushing incumbents toward techco transformation.
‘If we want to incorporate digital play, we will partner – not buy and build – because it’s not our core expertise,’ Alberto said. ‘This is the age of cooperation and partnerships.’
Better, but .
FOR all the technological progress and competitive improvements of the past two decades, ordinary Filipinos’ experience with telecommunications remains paradoxical.
The progress is real, though. Download speeds have increased fivefold, costs have dropped, coverage has improved, and fiber broadband now extends to nearly two-thirds of households. Digital services – from mobile wallets to streaming platforms – have proliferated.
Yet critics note that significant gaps persist.
‘Affordability is still an issue,’ Winthrop Yu, the chairman emeritus of the Internet Society – Philippine Chapter, observed. ‘Access has gradually improved, but many locales are still geographically isolated and disadvantaged areas.’
The affordability issue is particularly acute for lower-income Filipinos. While affordable mobile data buckets and fiber packages have proliferated for middle-class consumers, those in the C, D, and E economic segments still struggle to afford reliable connectivity. This digital divide risks excluding millions from the economic opportunities and government services that are increasingly available only online.
Likewise, Department of Information and Communications Technology (DICT) Secretary Henry Aguda acknowledged the challenge of coverage, estimating that only 50 percent of households have fiber lines, just 70 percent are on mobile, while a smaller 50 percent have access to 4 G.
More frustrating still, customer support remains ‘extremely poor across-the-board,’ according to Yu. For many Filipinos, getting help with service problems remains frustrating and time-consuming, despite telcos’ investments in digital customer service platforms and contact centers.
Regulatory reset, Konektadong Pinoy
FOR much of the past two decades, the Philippines’ telecommunications industry operated under a framework established in 1995 with Republic Act 7925, which deregulated the sector and opened it to competition. But the law still classified telcos as ‘public utilities,’ a designation that limited foreign ownership to 40 percent and constrained investment.
The amendments to the Public Services Act in 2022 reclassified telcos as public services, allowing for full foreign ownership. But what is expected to change the landscape fundamentally is Republic Act 12234, or the Konektadong Pinoy Act.
The measure seeks to ease market entry for small internet providers, especially in remote and underserved areas, through streamlined permitting, improved spectrum management, and mandatory infrastructure sharing.
‘Between then and now, I think nothing will match Konektadong Pinoy,’ Aguda replied when asked about consequential policy decisions. ‘Konektadong Pinoy basically changes the whole industry.’
The law’s immediate effects are expected to be dramatic.
‘The cable ISPs and smaller players in the provinces will be able to expand more freely,’ Grace Mirandilla-Santos, the convener of the Better Internet Philippines, said. ‘Data centers will have a broader market as access to meet-me rooms is no longer restricted by regulation.’
She added that if the law’s implementing rules and regulations (IRRs) are ‘done correctly, there should be an avenue even for the micro internet service providers, such as the piso WiFi, to legitimize operations and expand.’
Aguda’s ambitions are explicit and grand, although noting that changes will not be seen ‘overnight.’ He pointed to three things that should improve: coverage, cost, and quality.
He expects both mobile and fiber coverage to expand as early as 2026, while predicting Filipinos should see ‘at least a 30-percent drop in prices’ and a transformation in service quality.
‘The IRR will specifically give those measurable metrics as an industry – everyone will be accountable to those metrics. We will spell out the minimum requirements. There have to be holistic improvements in the country,’ Aguda said.
The law also addresses wholesale markets, which policy advocates have long identified as a bottleneck. By requiring infrastructure sharing and competitive access to backbone capacity, the Konektadong Pinoy Act aims to enable smaller internet service providers to compete without building redundant national networks.
Perhaps most significantly, the law is being complemented by the fact that the government is entering the infrastructure market directly.
The National Broadband Plan will offer capacity that ‘many will be enticed to come into the last mile because they can lease capacity from the government,’ Cabarios explained. This public infrastructure could prove especially important for serving far-flung areas where private investment alone has been insufficient.
More importantly, the law preserves one key regulatory principle that Cabarios credits with accelerating technology adoption: technology neutrality.
‘This policy and regulation helped technology flourish and be adopted fast in the Philippines,’ he said.
Rather than mandating specific technical standards, regulators allow operators to deploy whatever technology best serves their customers on the assigned spectrum.
However, the Konektadong Pinoy Act also raises new policy questions, particularly around market concentration as telcos expand into adjacent digital markets.
Consumer protection
AS telecommunications companies transform into technology conglomerates operating in fintech, cloud services, data centers, e-commerce, and digital advertising, among others, concerns about market power and fair competition have intensified.
‘If there’s a limit, my answer is yes,’ Aguda responded when asked whether there should be constraints on how much of the digital economy a single telco can control. ‘What’s hard to answer is how much and what sector. I always believed in avoiding concentration risks, because if you concentrate too much in one company, you create what the banking industry calls systematic risks.’
The concern is not merely theoretical. GCash now processes such a large share of the Philippines’ digital payments that prolonged service disruption carries macroeconomic implications.
PLDT, Globe, and Converge control the vast majority of internet connectivity, the fiber networks that enterprise customers depend on, and increasingly, the data centers where their applications run.
‘The telcos as carriers have an unfair advantage in digital markets they are expanding into,’ Yu warned. ‘The Philippine Competition Commission should seriously look into both horizontal and vertical integration with a view to enforcing FRAND [fair, reasonable, and non-discriminatory] access and the need for structural separation.’
He said the industry could look into the best practices in other territories and meld them together to tailor what is needed by the Philippines.
‘One can pick certain features from other countries,’ Yu said. ‘Indonesia’s requirement that its dominant player provide FRAND access to smaller players; Singapore providing access to frequency spectrum at lower prices; India’s encouragement of new players and focus on affordability.’
Privacy and data security represent another dimension of consumer protection that becomes more critical as telcos handle ever more sensitive personal and financial information.
AI Natives and the next wave of disruption
TODAY, telcos face a new horizon defined by AI, generational shifts in technology use, and the ongoing capital intensity of next-generation infrastructure.
Gen Alpha, born after 2010, and the emerging Gen Beta are growing up in a world where AI assistants, personalized algorithms, and machine learning are ambient features of digital life. Their expectations for connectivity, services, and experiences will differ fundamentally from those of earlier generations.
‘We’re closely watching AI, which is reshaping every industry before our eyes,’ PLDT wrote in its written responses. ‘It’s always stimulating to think of how they’ll transform our workplaces, our economy, and our lives, and how PLDT will enable them to thrive.’
Cruz agreed, saying that Gen Alpha will demand creation-ready platforms and AI tools.
Uy, on the other hand, promised to ‘go beyond connectivity’ as Converge seeks to ‘power the digital journeys of tomorrow,’ investing in data centers, international cables, and AI-enabled services under a new tagline: ‘From Fiber to Future.’
The infrastructure requirements are quite substantial. PLDT’s launch of AI-ready hyperscale data centers represents an early move to capture this market, offering GPU-as-a-service and machine learning infrastructure to enterprises.
Likewise, the capital demands of 5G densification, fiber expansion to underserved areas, and next-generation submarine cable systems continue to mount.
The ambitions and visions are grand. But they rest on an industry that has learned, often painfully, that no position is secure and no advantage permanent.
Corporate graveyard
WALK through the corporate landscape of Philippine telecommunications and you find ghosts in many corners – even companies that made rational decisions based on the information available, that invested in infrastructure and hired talented people, that served customers profitably.
Even Sun Cellular, the upstart that shattered the duopoly with ‘unli’ packages, has sunsetted. It is a headstone now, absorbed into PLDT.
The survivors transformed themselves so completely that they bear little resemblance to their former selves.
PLDT, founded in 1928 as a telephone company, now generates more revenue from data centers and cloud services than from traditional telephony.
Globe, once simply a mobile operator, has become a digital conglomerate spanning fintech, venture capital, and enterprise technology.
Dito created a network without any legacy infrastructure, banking on the future of mobile technologies. Converge built an entire company on the bet that fiber will soon become a necessity.
They survived by accepting a fundamental truth: in telecommunications, your core business is always in a constant state of technologically-driven evolution and reinvention. The only question is whether you can build the next one fast enough.
The game isn’t really about telecommunications anymore. It’s about who controls the digital infrastructure of Filipino life: the payments, the cloud, the data, the artificial intelligence. The telcos reinvented themselves as techcos because they had to.
‘You have to go to tech. You have to create tech companies. Otherwise, you will die. Similar to what happened before, those who did not shift from telegraph to telephone to mobile to data will die. If they remain complacent, nothing good will happen to them,’ Cabarios said.
The industry may forever live in a cycle of creative destruction and rebirth. The evolution of Philippine telecommunications isn’t finished – it may never be.
The graveyard might grow, even as new giants rise. And the companies that rule today must live with the truth that shaped their survival: adapt and reinvent, or resist and die. Either you follow the money or join the dead.