Upstart DITO takes on PLDT-Globe duopoly in Philippines: Ookla

·Senior Editor
·4 min read
Filipinos use their mobile phones at a park in Taguig, Metro Manila, Philippines, August 2, 2018. Picture taken August 2, 2018. DITO has 9 million subscribers since its entry into a saturated mobile market in the Philippines 15 months ago. REUTERS/Erik De Castro
Filipinos use their mobile phones at a park in Taguig, Metro Manila, Philippines, August 2, 2018. Picture taken August 2, 2018. DITO has 9 million subscribers since its entry into a saturated mobile market in the Philippines 15 months ago. REUTERS/Erik De Castro

Fifteen months after it first entered the saturated mobile market in the Philippines via commercial operations in Visayas and Mindanao, upstart telco Dito Telecommunity (DITO) has carved out a 1 per cent market share, or 9 million subscribers as of June 2022.

This is lower than expected of a new market entrant, and is dwarfed by telco giants Globe (87.4 million) and Smart (70.3 million). Nevertheless, DITO has cracked a market dominated by the PLDT-Globe duopoly since PLDT acquired Smart in 2011.

And according to Internet analytics company Ookla, DITO is targeting 12 million subscribers by year end, aided by promotional packages such as unlimited data for 30 days with 25 GB of data, unlimited text and 300 minutes of calls.

In addition, the introduction of Mobile Number Portability (MNP) last September, which allows subscribers to keep their existing mobile number when changing mobile providers, could shift the landscape.

"This hasn’t been as successful as expected – with only 5,000 requests being made in a space of three months (September to December 2021)," said Ookla's Sylwia Kechiche in a June 30 analysis.

"In time, and with more customer education, we foresee MNP to have more of an impact on the market."

Saturated telecom market

INFOGRAPHIC: Ookla
Upstart telco DITO has carved out a 1 per cent market share, or 9 million subscribers as of June 2022. (INFOGRAPHIC: Ookla)

According to GSMA Intelligence, Filipino market penetration stood at 137.5 per cent with an average of 2.1 SIMs per user in Q1 2021.

The Philippines has the highest number of social media users globally, while Filipinos also spend a lot of time online - according to the Digital 2022 report, internet users aged 16 to 64 spent an average of 10 hours and 27 minutes using the internet each day.

"Yet, the Philippines suffer in terms of having relatively low mobile internet speeds due to challenging geography and affordability," said Kechiche.

The two-operator mobile market was also not good for Filipino consumers. "A 2014 study by the think tank LIRNEasia found that internet users in the Philippines have paid more for worse connectivity compared to other Asian countries with investment into the telecom sector held back," noted Kechiche.

A third player was therefore introduced to the market to add competition, improve network performance, and reduce prices in the market.

Playing to its strengths

The new operator’s license came with coverage and performance obligations, which are tracked by technical audits performed on behalf of the National Telecommunications Commission (NTC).

But DITO has met all of its coverage and performance obligations, and plans further investment and expansion of its 4G and 5G networks. DITO doesn’t operate 2G and 3G networks so its customers must have 4G-capable phones.

"The newcomer’s strategy wasn’t to start a price war with the incumbent operators," said Kechiche, noting that DITO instead focused on delivering faster speeds, differentiated customer experience and simpler products.

The operator tapped into its parent company’s distribution network – retail stores of Udenna Group and gasoline stations of Phoenix Petroleum to distribute its services. It also leveraged China Telecom’s know-how and funding.

Five-year plan

According to DITO's five-year plan, it has already achieved two key goals and is well on its way to achieving the other goal.

For example, the operator committed to reach more than 37.01 per cent country population with a minimum average broadband speed of 27 Mbps. According to a February 2021 Audit, DITO has already achieved 37.48 per cent population coverage.

It has also exceeded its 51.01 per cent population coverage target, by achieving 52.57 per cent population coverage, according to a September 2021 Audit.

Year 5 will see an 84 per cent population coverage obligation, which DITO has increased to over 90 per cent, and the goal of an average mobile internet speed of 55 Mbps speed.

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