Broadband service; the major growth driver for Philippine Long Distance Telephone Co. (PLDT)

Philippine Long Distance Telephone Co.  (PLDT), the country’s biggest phone company shows increase in profit, as result of the broadband service. Manuel V. Pangilinan, the chairman of the company reported on Friday, that they were looking to post an increase in first quarter net profit as compared to the P9.6 billion on 2009.

According to Pangilinan, both the wired and fixed broadband businesses help to add on to the increment, mainly in the corporate-data services, spanning the small and medium enterprises. The firm expects the broadband subscribers to be twice in 2010, more than the last year’s reported 1.6 million, even as wireless sector continued to decline. Pangilinan claim that the legacy business, that of wireless remained flattish. He however went on to say that the wireless takers even then will be more than from last year. The report states the end- 2009, PLDT total cellular subscriber base up to 4.13 million, a 17% rise annually.

Meanwhile, Napoloen Nazareno, the President of PLDT responds that the trend in the increase of subscribers for the first 2 months of 2010 remain the same as in January and February 2009. This means that there was an added 500,000 latest wireless subscribers for January, in addition to another 500,000 in February 2010.

Pangilinan goes on to add that the cellular business end up facing challenges as result of the high market penetration. Other reasons that add to it include the market’s rising inclination for unlimited offers and multiple SIM ownership, on top of competition from social networking and broadband. He also claims that his group was looking to buy about 4% stake in the Manila Electric Co. owned by PhilPlans Inc., a company owned by Eusebio Tanco. Tanco’s stake was the result of buying the shares from state pension fund Government Service Insurance System in December, last year.

The PLDT group, via Pilipino Telephone Corp. and Metro Pacific Investments Corp, has over 41% stake in Meralco. Additionally, if it gains Tanco’s stake, its interest in the country’s largest utility firm, will show an increase up to 45%.

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