Vibrant market fuels network deployment in Philippines

The flourishing local economy and insatiable demand for Web-connected devices are pushing firms to roll out the latest networking technology to stay competitive. But next-gen stuff like software-defined networking remains nascent.
Written by Melvin G. Calimag, Contributor on

MANILA--The country's flourishing economy and growing adoption of Web-connected devices are driving new deployments in the networking space, as enterprises work to keep pace with demand. 

Apart from its unofficial titles as "SMS capital of the world" and "call center capital of the world", the Philippines recently also earned its place as the fastest growing economy in Asia in the first quarter of 2013. With a gross domestic product (GDP) rate of 7.8 percent, the country's economy was better than regional powerhouses China at 7.7 percent, Indonesia at 6 percent, Thailand at 5.3 percent, and Vietnam at 4.9 percent.

The rosy local economy and insatiable demand for Internet-connected devices among Filipino consumers are pushing operators and companies here to roll out the latest network technologies--both wired and wireless--in order to stay competitive and attuned to the times.

In fact, mobile operators Globe Telecom and Smart Communications were among the first in the region to launch LTE networks as early as two years ago in anticipation of bandwidth-heavy services such as data, video, and cloud computing. Both carriers have also rolled out fiber-to-the-home (FTTH) service, offering broadband speeds up to 100Mbps.

Ericsson Philippines, which counts Globe Telecom and Smart Communications as clients, said LTE implementations are crucial in addressing consumer demands on mobile infrastructures.

"In the Philippines, what we're seeing is that subscribers are very data-savvy, especially those who are based in the urban areas," said Elie Hanna, president and country manager for Ericsson Philippines and Pacific Islands. "Last year, when we did a ConsumerLab study on the country, the Philippines led other emerging markets in Southeast Asia with regard to smartphone and tablet penetration in the urban areas. These devices, of course, place greater demand on mobile networks."

Demand for bigger bandwidth, though, was just starting, Hanna said. "We believe that in the near future, traffic is going to be 90 percent video. So we are helping our customers optimize for video," he said.

For Stephen Misa, country general manager for the Philippines at Cisco Systems, the shift toward more powerful wireless technologies was a no-brainer. "We have been seeing a lot companies empower their executives and workforce with applications on their multiple mobile devices, whether company-provided or employee-owned. So 4G/LTE and hi-speed Wi-Fi is not an option anymore--it is now a must," Misa said.

While LTE has already entered the daily lexicon of mobile users, other next-generation technologies such as software-defined network (SDN) and Gigabit Wi-Fi have yet to gain widespread traction.

However, Emmanuel Estrada, head of network technologies strategy at Globe Telecom, said the company is keeping a close eye on these emerging trends. "Globe is also looking into the deployment of Gigabit Wi-Fi and SDN as soon as these technologies become commercially viable and more stable in the country," he said.

Hanna said the SDN concept is still in the development phase, although the company was able to show some architectural advances, proof-of-concept developed with network operators, and new control interfaces at the Mobile World Congress in February. 

"It was also during that event when we announced our commitment to deliver the first commercial service provider SDN application in the fourth quarter of 2013," he added. 

Challenges in deployment

Although the Philippines' economic growth has paved the way for increased investment opportunities in new technologies, major hurdles still confront local companies in their technology adoption.

In the case of dominant carrier PLDT, which owns Smart Communications, the networking industry is still hounded by IP (Internet Protocol) transport issues and lack of standards for core interfaces.

Globe Telecom, on the other hand, said the most common challenge, at least from an implementation perspective, is backhaul transmission, as data traffic continuous to increase and new broadband technologies such as LTE are deployed. 

"To address these, Globe's network transformation program provides for the deployment of major fiber optic backhaul transmission system to provide a future-proof and highly scalable transmission to meet the demands of broadband and data services," Estrada explained.

Cisco Philippines' Misa said the main challenge sometimes is that organizations, quite simply, have silos of networks. "[This] results in inefficiencies, high cost of maintenance, and scalability issues, which can hamper their ability to innovate and for some, delay in launching new services and longer time to market new products or offerings," he said. 

Storage vendor EMC Philippines said local organizations should be proactive in managing their networks.

"IT managers not only need to support current technologies, manage an increasingly complex data center, manage and store data created, but also need to keep an eye to the future and consider the kinds of technologies and infrastructure they will need to support," it said.

Melvin G. Calimag is a freelance IT writer based in the Philippines.


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