Investments needed to make Philippine internet prices cheaper, says research group

MANILA, Philippines – An international research organization said that the Philippines needs more investments to improve its digital connectivity and bring down prices, which are more than double the Southeast Asian average.

BMI Research, a unit of the Fitch Group, said that while the Philippines is investing in improving its digital infrastructure, at its current rate, it may only provide marginal upsides to its outlook. 

The country recently approved the P16.1-billion World Bank-financed Philippines Digital Infrastructure Project (PDIP), which is set to construct a public broadband infrastructure network to help increase broadband connectivity in far-flung areas. 

According to the 2024 World Bank report dubbed "Better Internet for All Filipinos: Reforms Promoting Competition and Increasing Investment for Broadband Infrastructure," the Philippines' internet connectivity is the most expensive in the Southeast Asian region but is relatively slow compared to Singapore, Thailand, Malaysia, Vietnam and Brunei.

“Execution and project management will be key for the success of the PDIP to boost stronger fiber uptake among Philippine-based households. By extensively co-financing last-mile area rollout, wholesale network providers and internet service providers may be encouraged to further decrease prices on fiber bundles though at the expense of average revenue per user figures,” BMI said in a report.

“Renewed government efforts to fiberize the Philippines’ last-mile areas will be beneficial for the players with a large risk-seeking stance. Regardless, wider digital transformation ambitions and the attractiveness of the Philippines’ ICT market are set to benefit from a stronger nationwide backbone and last-mile network density,” it added.

In a 2023 study conducted by international consulting firm Arthur D. Little dubbed "Can required digital infrastructure of Southeast Asia be built profitably in the next 5 years," it showed that the Philippines recorded the second lowest cumulative investment in fiber coverage and targets among SEA countries.

The study showed that the Philippines needs to spend around $1.1 billion to reach the required target coverage levels, as the