Converge selects ZTE for XGS-PON rollout in the Philippines; ISP sets FY22 CAPEX figure

22 Mar 2022

Fibre broadband provider Converge ICT Solutions is teaming up with China’s ZTE for the commercial launch of 10-Gigabit-capable symmetric passive optical network (XGS-PON) infrastructure in South Luzon and the Visayas by May 2022. In a press release, the vendor noted that the ISP will be the first operator to provide XGS-PON services to the mass consumer segment in the country and added that, going forward, it will cooperate with Converge to expand the commercial range of XGS-PON in the coming years. ‘In the future, we will continue to work with ZTE to build a stable and efficient network in the Philippines,’ said Ronald G Brusola, CTO at Converge. ‘The next few years will be a window period for 10GPON development. We hope to work with ZTE to build a fixed broadband network that everyone can afford.’

Under the deployment, ZTE said it utilised multiple XGS-PON devices with ultra-high bandwidth, such as F8648P and Flex PON technologies, for a smooth evolution from GPON to XGS-PON. In addition, it has begun its tests on its WiFi 6 ONT and Mesh WiFi products, which it claims will provide high-quality and comprehensive XGS PON solutions and products. ZTE’s ONT has a 10GE downlink port to satisfy users’ high speed access requirements, it added.

In related news, Converge this week announced that it is setting aside around PHP26 billion-PHP28 billion (USD496 million-USD534 million) this year for capital expenditure projects – eclipsing the PHP25 billion it spent in FY21. The telco’s CFO advisor, Matthias Vukovich, confirmed the plans during a virtual press briefing noting that the CAPEX will be allocated for its ongoing backbone expansion as well as for selected investments into international subsea cables and enhancement of its ICT systems.

The ISP booked revenues of PHP26.48 billion in FY21, up from PHP15.65 billion in the previous year as residential turnover soared 83% to PHP23.13 billion and enterprise revenue rose 11% year-on-year to PHP3.35 billion from PHP3.02 billion. The uptick in sales helped boost net income to PHP7.16 billion in full year 2021, more than double the figure of PHP3.39 billion reported in FY20, as Converge added a net 115,000 residential subscriptions for a year-end total of 1.7 million. With its EBITDA margin also increasing to 55.9% (FY21) from 52.5% (FY20), the company claimed it is ‘on track to reach its adjusted goal of approximately 55% nationwide household coverage by 2023, two years earlier than promised during the initial public offering’. ‘We expect that strong demand for reliable high speed broadband will result in continuous growth of our residential subscriber base to approximately 2.4 million by the end of 2022,’ it added.

Philippines, Converge ICT Solutions, ZTE