Background of FTTH Development
With the full maturity of fiber-to-the-home (FTTH) technology and the rapid decline in cost, passive optical network (PON) has been gradually recognized by operators and users because of its low cost, high reliability, long lifecycle and easy maintenance. Moreover, the neighboring countries of the Philippines have deployed PONs on a large scale and operated successfully. This provides a good reference model for the FTTH industry in the Philippines.
Converge Information and Communications Technology Solutions Inc (Converge ICT) was founded in Angeles City of the Philippines in 1996. After a careful and in-depth analysis of the market, Converge ICT decided to completely transform its networks to FTTH in 2018, taking PON as the only technical route for FTTH, and invested heavily in building HomePass and developing end users. By sticking to the rapid expansion strategy, Converge ICT deployed a large number of HomePass devices to seize the fiber-to-the-home market, took high-value cities such as Manila and Cebu in the Philippines as its main expansion targets, and enhanced its brand reputation by taking advantage of the opportunity of less than 20% FTTH penetration rate in the country. Converge ICT also attached great importance to the quality of FTTH networks and Wi-Fi experience to ensure user stickiness.
Road of FTTH Construction
Converge ICT started FTTH transformation in 2018 and chose ZTE as its partner to jointly build the FTTH network. They determined to use the FTTH solution and evolution path that leverage the dual-band optical network terminals (ONTs) to meet user needs for high-quality Wi-Fi experience and the Any-PON solution to meet user needs for smooth evolution to 10G PON. Converge ICT adopted ZTE's C350 optical line terminals (OLTs) as well as F660 and F670L ONTs. The scheme met the needs of Converge ICT for fast and flexible network deployment and dual-band Wi-Fi. By actively deploying the interoperability technology, Converge ICT broke down the barriers between different equipment suppliers, so that ZTE's ONTs and OLTs could be rapidly deployed in areas where Converge ICT needed to expand.
Since 2020, Converge ICT has deepened its cooperation with ZTE and deploying ZTE's OLT C650 on the new-generation TITAN platform on a large scale. This is also the stage when the user base of Converge ICT has soared. Converge ICT not only grasps the opportunity of rapid expansion of FTTH users, but also makes full plans for bandwidth-hungry and low-latency FTTH services in the future. The unique Any-PON service card deployed on the OLT C650 provides GPON service through the GPON optical module, and the GPON ONT can drive down the deployment cost. When upgrading to 10G PON services in the future, Converge ICT only needs to replace the GPON optical module with any 10G PON optical module and does not need to make any change to ODN. Considering both the current cost and the convenience of future upgrade, this solution has become a universal solution used by Converge ICT in all its networks. Converge ICT has also adopted ZTE's dual-band ONTs, with F670L as the main delivery model. The dual-band ONT solution helps Converge ICT improve Wi-Fi experience of end users, gain market reputation, and further secure and expand the market share.
Achievements of FTTH Transformation
Converge ICT had more than 1.6 million FTTH users and more than 11 million HomePass users from 2018 to the first quarter of 2022. Its FTTH users exceeded that of the powerful competitors, making Converge ICT the second largest FTTH providers in the Philippines. The FTTH revenue of Converge ICT in the first quarter of 2022 exceeded 100 million USD.
Thanks to precise market strategies and user positioning, the FTTH ARPU of Converge ICT has been maintained a high level. This gives Converge ICT more confidence to further increase its investment in FTTH. Targeting the FTTH market in major cities in the Philippines, Converge ICT had successfully developed more than one million subscribers in Manila, the capital of the Philippines, and Cebu City, the Philippines' second largest city as of the first quarter of 2022. Its FTTH brand Fiber X has been greatly favored in the Philippines, and was rated as "Top-Rated Fixed Network" in the country by a third-party network evaluation company Ookia in the first half of 2022.
Prospects for the Future
The current FTTH penetration rate in the Philippines is only about 20%, and a large number of users are still using FWA or DSL services. However, PON-based FTTH has already been recognized by operators as the only future-oriented fixed broadband technology. Other major operators in the Philippines are also gearing up, aiming to rapidly increase their market share in the fierce competition that follows.
Converge ICT now has full confidence in the next round of competition. It is widely deploying HomePass in densely populated areas in the Philippines to seize the key urban user market, deploying ZTE's TITAN-based OLTs for the next-generation PON on a large scale, establishing market brands such as Fiber X, and expanding sales partners nationwide. These strategies will lay a solid foundation for rapid growth of Converge ICT in the future, and Converge ICT's FTTH business will continue to maintain high-quality and rapid growth in the Philippines.