INTERNET provider Converge ICT Solutions Incorporated recently signed an investment deal with Warburg Pincus LLC, an American private equity firm, to strengthen its current capabilities, as it aims to improve and upgrade the online experience of Filipinos.
Converge president Dennis Anthony H. Uy said the partnership will allow Converge to reach more people and thereby serve more Filipinos by providing the kind of internet access needed to thrive in today's world and offer the most affordable service plans, the first step to serving the people is by reaching them.
At present, internet rates in the Philippines are high that the number of underserved and unserved people is still at an alarmingly level, according
Uy said only 63 percent of the Filipino population have direct access to the internet.
"Given how vital connectivity is in today's lifestyle, that figure shows how considerable the gap to be bridged is. We need more investors in the IT industry. This is where Converge ICT can truly make a national impact," he said.
Since the firm went full throttle with the roll-out of its fiber network and package offerings, the change in overall internet performance has been noticeable, he said.
"In 2018, the average internet speed increased to 18Mbps from the earlier 4Mbps, a move that has improved the Philippines' ranking in the Southeast Asian Region in terms of broadband internet speed. Converge doesn't take full credit but the company's contributions has been undeniable," Uy added.
He also cited a study conducted by Nathan Institute and Oxford Institute showing the GDP's correlation to an increase in percentage of the population having access to Information and Communications Technology (ICT).
The study indicated ICT can improve the overall GDP by as much as one percent that is why it is crucial for countries to have a strong national broadband infrastructure made available at a more affordable cost for the people because a 10-20 percent increase in the number of internet users in the population would speed up economic growth, according to Uy.
"We want nothing but the very best for the Filipinos. We have taken it upon ourselves to be the local world-class internet provider. That is our
commitment to the Filipinos. To serve the under-served and un-served. Together, we will use technology to be what it has been set out to be: to make information more readily available, services faster, communities safer and life, in general, better. Convenience on-demand," he said.
He said this partnership with Warburg Pincus will power the nation to dream even bigger as it will be the lead-in to how Converge have been consistently upholding its commitment to upgrade the Filipino online experience.
"We need to reinforce our efforts to ensure that we serve and save more Filipinos from bad internet. This partnership intends to take care of the nation through connectivity. By upgrading your way to access the world, we are uplifting the way you live. Today is one of the most important days in the digitization of the Philippines," Uy said.
Warburg Pincus managing director Saurabh Agarwal expressed hope that the joint venture will transform the lives of Filipinos across the Philippines and around the world by bringing high-speed fiber broadband to each barangay in the country.
Agarwal said Warburg Pincus, the oldest growth investor in the world with a 53-year history of investing, was among the first private equity firms to invest in Asia, starting in China and India over 25 years ago, and in SEA about seven years ago.
He said their firm had invested over US$70 billion in more than 800
companies in over 50 countries and currently have over US$60 billion under management and over US$20 billion available in new capital to invest behind exciting companies.
Agarwal said their company has sought to invest behind market-leading companies with superior management teams and sustainable competitive advantages.
"And we saw in Converge all of these core strengths. Converge exemplifies a company that is uniquely able to capitalize on attractive macro fundamentals and secular tailwinds in the Philippines to grow, while at the same time, serving a critical yet unmet need of the Filipino people," Agarwal said.
He narrated that when Dennis and his wife Grace set out to build Converge in 2012, they wanted to make high-speed internet accessible to the Filipino people. So, they went to the market with a simple value proposition: High-speed, high-reliability fiber broadband connectivity, at an affordable price point, accessible to as many households and businesses in the country who need it.
"Their vision and value proposition resonated well with many Filipinos, propelling Converge to become the fastest-growing telecoms company in the country. It is truly a remarkable business and growth story, and we attribute that to the leadership of Dennis and Grace, and the dedication of their teams. In the past 12 months that we've gotten to know them and their teams, I've seen how dedicated and persistent they've been in pursuit of excellence and growth," Agarwal said.
He said the Philippines, with its young digital-savvy population and thriving services industries, combined with the country's focus on infrastructure spending, is poised for further explosive growth, especially in the telecoms sector.
"Our US$250 million investment in Converge will enable us to participate in addressing these growth needs with fast, reliable and yet affordable internet. We intend to leverage both our domestic and international partners, that includes our partners in government, to bring to Converge all the support it needs," Agarwal said.
He said the funds from Warburg Pincus will help finance Converge's plan to build a US$1.8-billion nationwide internet backbone.
Uy said the project includes a US$70-million domestic submarine cable with 20 landing stations across the Philippines. The Luzon backbone will be substantially complete by the first quarter of 2020.
He said he plans to connect the whole country and provide dependable broadband internet service to the people even in far-flung barangays.