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51221582
51221582
A course requirement in
CASE STUDY
About
MANG INASAL
Submitted to:
MRS. NORMIDA HERNANDEZ
Submitted by:
RIZALYN M. GLUA
BSBM-BE III
company’s business can be divided into three main business areas: fixed line, wireless, and
PLDT is the leading telecommunications service provider in the Philippines. Through its
three principal business groups-wireless, fixed line, and information and communications
technology-PLDT offers the largest and most diversified range of telecommunications services
across The Philippines’ most extensive fibber optic backbone and wireless, fixed line and
satellite networks.
PLDT is listed on the Philippines Stock Exchange (PSE: TEL) and its American
Depositary Shares are listed on the New York Stock Exchange (NYSE:PHI) and the Pacific
Exchange. PLDT has one of the largest market capitalizations among the Philippine listed
companies.
The fixed line business provides local calls, national and international long distance
services, which operates around 2.1 million access lines. The wireless segment provides
cellular, satellite, and VSAT services. PLDT provides cellular services through SMART, while
Piltel is a reseller of SMART’s digital GSM capacity under its own branding and pricing strategy
applications and multimedia content delivery, with use of internet protocol-based solutions. The
internet accesses are provided by Infocom – a subsidiary of ePLDT. And other investees of
During the time of Spanish colonization of the Philippines, the Spaniards organized a
telephone company that opened in 1890. PLDT was established on November 28, 1928, by an
means of a merger of four telephone companies under common US ownership. Known as Act
3436, the bill granted PLDT a 50-year charter and the right to establish a Philippine telephone
network linking major points nationwide. However, PLDT had to meet a 40-day deadline to start
implementing the network, which would be implemented over a period of one to four years.
By the 1930s, PLDT had an expansive fixed-line network and for the first time linked the
Philippines to the outside world via radio telephone services connecting the Philippines to
Telephone service in the Philippines was interrupted due to World War II. At the end of
the war, the Philippines' communications infrastructure was in ruin. U.S. military authorities
eventually handed over the remains of the communications infrastructure to PLDT in 1947, and
with the help of massive U.S. aid to the Philippines during the 1940s and 1950s, PLDT
recovered so quickly that its telephone subscribers outpaced that of pre-war levels by 1953.
Ramon Cojuangco took control of PLDT after buying its shares from the American
telecommunications company GTE. The group took control of PLDT's management on January
1, 1968, with the election of Gregorio S. Licaros and Cojuangco as chairman and president of
PLDT respectively. A few months later, PLDT's main office inMakati City (known today as the
Ramon Cojuangco Building) was opened, and PLDT's expansion programs begin, hoping to
of the then existing policy of the Philippine government to integrate the Philippine
telecommunications industry, purchased substantially all of the assets and liabilities of Republic
Telephone Company, becoming the country's telephone monopoly. However, after he was
overthrown, the company was re-privatized. By 1995, with the passage of the
In 1991, Smart Communications was incorporated, with its major shareholders at the
time being certain Philippine companies and other affiliates of First Pacific (the parent company
of PLDT), as well as NTT Communications Capital (UK) Limited. Both groups owned around
On March 24, 2000, PLDT completed its share-swap acquisition of Smart, making Smart
On November 29, 2008 celebrate 80 years and the slogan is We're Changing Lives live
on Eat Bulaga at GMA Network in Saturday. On March 2, 2010, PLDT announced that its
subsidiary, Media Quest Inc., has acquired 100 percent of Associated Broadcasting
Manuel V. Pangilinan, Chairman | Napoleon L. Nazareno, President and CEO | Dan Ibarra,
BOARD OF DIRECTORS
PLDT will be the preferred full service provider of voice, video and data at the most
attractive levels of price, service quality, content and coverage, thereby bringing maximum
Helen Y. Dee
Ray C. Espinosa
Tatsu Kono
Takashi Ooi
Oscar S. Reyes
Juan B. Santos1
The following are PLDT's wholly-owned subsidiaries and affiliates (as indicated), divided
Wireless:
Telesat Philippines
Smart Communications
Smart Broadband
I-Contacts Corporation
Wolfpac Mobile
Wireless Card
Smarthub
Ph Communications Holdings
Francom Holdings
ACeS Philippines
Fixed-Line:
PLDT Global
PLDT US
PLDT US Retail
PLDT UK
PLDT HK
PLDT HK 1528
LDT HK Ltd
PLDT SG
ePLDT
ePLDT Ventus
Vocativ Systems
Parlance Systems
SPi Technologies
Broadcasting:
Primedia Inc.
Cignal Digital TV
Wireless
PLDT reported that as of December 31, 2009, its mobile phone subscriber base reached
41,328,641 users, combining subscribers using Smart, Talk 'N Text, and Red Mobile.
MISSION STATEMENT
PLDT will be the preferred full service provider of voice, video and data at the most
attractive levels of price, service quality, content and coverage, thereby bringing maximum
VISION STATEMENT
PLDT is an employer of choice. A high performing organization, a great place to work in,
attracting and retaining the best talents in the marketplace, best in class and proud of its
heritage.
MATRIX OF MISSION AND VISION OF PLDT AND COMPETITORS
The mission of PLDT is short but complete that the readers can easily understand what
the company vision is. It is also interested to read for the reason that it is short so.
The PLDT vision is very interesting. It is also good that PLDT make their vision broad.
FUNCTIONAL AREAS OF PLDT
Management
The company is the largest and most diversified telecommunication company in the Phil.
The company has managed the business onto 3 main segments, wireless, fixed line and
Smart Communications, Inc and Pilipino Telephone Corporation. Fixed line Telecommunications
service primarily provided trough PLDT. Information and communications infrastructure and
Marketing
The company’s goal is to reach out to their consumers and all possible market. They
want to reach out to satisfy their needs. The company hires all the right staff for this kind of job.
Finance / Accounting
On a consolidated basis, PLDT used net cash of Php41, 557 million for financing
activities in 2006, compared to Php27, 937 million in 2005 and Php30, 827 million in 2004. The
net cash used in financing activities in 2005, 2004 and 2003 was mainly attributable to interest
payments and debt repayments by PLDT in line with its ongoing debt reduction program.
Production / Operations
PLDT consolidated net cash flows from operating activities in 2006 increased by Php17,
542 million, or 31%, to Php73, 514 million from Php55, 972 million in 2007 and by Php1, 334
A growing portion of our consolidated cash flows is generated by our wireless business,
which accounted for 61% of our consolidated revenues and other income in 2006, compared to
57% in 2005 and 51% in 2004. Revenues from our fixed line and information and
communications technology services accounted for 37% and 2%, respectively, of our
consolidated revenues and other income in 2006, compared to 41% and 2%, respectively, in
Wireless’ cash flows from operating activities accounted for 57% of our consolidated
cash flows from operations owing to the sustained growth of our cellular subscriber base and
service usage. Our fixed line business contributed 41% to our consolidated cash flows from
operations in 2006 with improved collection efficiency and lower cash expenses in line with our
cost-containment efforts. We believe that our continuing strong cash flows on a consolidated
basis will allow us to defray our current liabilities despite our current ratio being less than 1:1 as
Philippine Long Distance Telephone Co. has recently forged new partnerships with
leading software and computer hardware companies to expand its innovation laboratory and
churn out new innovative solutions for clients and thereby uplifts information and
Intel, Microsoft, ProSoft, GIS, JIMAC, IBM Avaya, Veritas and Microdata teamed up with
PLDT in the expansion of the PLDT InnoLab, where research and development on
can be conducted. The expansion involved converting the whole PLDT TelTEC Building on Boni
Street in Mandaluyong City into the PLDT InnoLab Building, where PLDT InnoLab used to
The new partners for PLDT InnoLab provided the applications and some of the
equipment for demonstration, training, and research and development activities with
government, academe and PLDT clients. PLDT also added new laboratory and training rooms
Management Information System (MIS) receives information from both the external and
internal evaluation of an organization. It gathers data about marketing, finance, production and
EXTERNAL ASSESMENT
The entry of new competitors poses a low threat in the industry. The business requires a
huge capital outlay to engage to it. It is not that easy to invest in a business like this.
Rivalry among Competitors is medium. Rivalry among competitors in this industry is not
that intense. It is not that intense because it is really hard to dominate in this kind of industry
Threat of Substitute
Threat of substitute is medium. Even though cell phones are already such a click as a
Bargaining Power of Suppliers is low. The business does not need any suppliers. The
business must have a large network and the most updated technology to cope up with the fast
Bargaining Power of Buyers is low. Consumers cannot bargain. The consumers can only
INTERNAL ASSESMENT
SWOT ANALYSIS
STRENGTHS
Owns top position – PLDT owns the top position in the Philippines for the telecoms industry.
They initially provided fixed line to the Philippine market during the early times, and have now
extended their market for wireless technology. By acquiring SMART as their wireless partner,
they became the number 1 provider for wireless phones. As technology continued to boom, then
came the internet, which started as dial-up connection and eventually produced the broadband
connection, widely known as the DSL. Then came ePLDT, which stood as the technology arm
of PLDT. ePLDT gave the answer to internet problems and also took the top position.
Majority of Philippine market share – Having a wide range of products, from fixed line, wireless
line, and internet connection, PLDT was able to capture majority of the Philippines market.
PLDT holds the Philippine market for fixed line. By taking a gamble of getting SMART during the
time when the GSM (Global Service for Mobile Communications) service and cellular market
growth was still uncertain, they now earned the market for wireless lines, used of mobile
phones, which accounts for 52% of PLDT Group’s revenues. As technology was taking over the
public’s attention, PLDT also caught the market in broadband and narrowband internet. They
launched the product Vibe for dial-up connections, and DSL for broadband connections.
Industry specialists – With the long history and very vast knowledge in the industry, PLDT has
invested on their people. As technology becomes more sophisticated, the company provided
trainings to their employees to keep them up to date with the latest technologies and be at par
or better than their competitors. PLDT provides training with a trainer and by use of online
materials.
National and global coverage – After successfully capturing majority of the market in the
Philippines, PLDT decided to go global by expanding their market in Hong Kong. They launched
the 1528 Smart to cater for the Filipino people in Hong Kong. This was a partnership of Hong
Kong CSL Ltd and PLDT (HK) Ltd. It allows the Filipinos in Hong Kong to access Smart mobile
services and content, which includes Smart Money, Smart Load, Smart Pasaload, and Smart
Padala – the world’s first text-based remittance service. This also provides a cheaper rate for
OFWs when they make long distance calls or send text messages to the Philippines. The cost is
Creative marketing strategies – PLDTs marketing proved to be one of the best by continuously
coming out with new ideas to capture the Philippine market. Aside from the products that they
already sell to customers, they think of ways on how they can satisfy the needs of the people by
providing more reasonable and affordable rates and give chance to the less fortunate to
so PLDT thought of ways to capture the mass market. With a wide range of products they can
offer, they transformed them into smaller forms to make it more affordable to the majority of the
public. For the fixed line, they came out with the “Telesulit”, which offered a prepaid version of
the fixed line. This enabled PLDT to retain their customers who cannot afford the normal fixed
line, and resulted to 33% more fixed line users from a year ago. For the Vibe, the dial-up
internet connection service, they also offered a prepaid version, by allowing customers to
purchase scratch card that contained the connection details, which only amounted to 100 and
allows the customer to use 20 hours of internet. If we calculate it in a per minute basis, it only
costs 8 cents per minute. Aside from the prepaid internet offered for the Vibe, it also has what
they call the pay-per-surf. Using this kind of package, the customers will only pay for the
minutes they use. For the wireless services, SMART introduced the Smart Load, which enabled
WEAKNESSES
Customer service – When PLDT launched its Vibe and DSL products, which allowed customers
to have a faster connection to the internet using broadband, there were a lot of complains
regarding the service provided. Much of the complaints were because of the slow connection
which didn’t meet the customer’s expectations. And that complaints made or reported were not
attended at a reasonable time. This kind of situations may cause customers to decide and
change their providers, who they believe are much better in providing the service needed.
Foreign Investments – PLDT is very much exposed to the risk of peso weakness because 98%
of its US$2.5 billion is denominated in foreign currency. Around half of the company’s total debt
are covered by the US Dollar, which is equivalent to around USD$351 million. The risk of the
depreciation of peso is mitigated by the linkage of about 40% of PLDT’s revenues to US dollar.
Since about 18% of PLDT’s US dollar linked revenues are from the monthly charges payable by
the postpaid fixed line customers, these monthly charges may increase if the peso depreciates.
OPPORTUNITIES
Venture for new technologies – Ideas of introducing a new technology to the market is a good
move, especially if the product is very attracting to the public. People are very much interested
for new products that are launched in the market, and how it can add do the current technology
they are using. Being the very first to release a new technology will have a good chance of
capturing the market sales, therefore increasing in customers and revenue. An example for this
Dropping prices of PC and laptops – As more and more people are turning into the computer
business, it is predicted for prices of PCs and laptops to go down to affordable prices, as other
computer manufacturing companies are trying to offer lower cost for these equipments. The
more affordable these electronic equipments go, the more people will be willing to purchase
one. And as more computers are sold, there will be a bigger demand for broadband service.
Partnership with other establishments – With the internet becoming part of the everyday life
nowadays, people are looking for ways to connect to the worldwide web wherever they go –
restaurants, hotels, shopping malls, resorts, and other public places. Having a broadband
socket or hotspot in place may attract more people in choosing this certain area other than their
competitors. This may result for the establishment to gain more customers and at the same
Fixed line market drop – There are predictions that the fixed line market will drop as the future
nears. With new communication technologies coming out at a very fast rate, the public are now
considering of using those new technologies that offer more comfort and convenience. Even for
PLDT, who holds the market for fixed line, may be affected of this drop in sales.
Industry competitors – Presently, there are already different competitors providing the same
services as PLDT and SMART have, not to mention other competitors that may still enter the
playing field. If one of those competitors will be able to introduce a new product that may
interest the public, then there’s a chance that customers will consider having a deal with those
competitors.
SUMMARY
and services in the Philippines. The company’s Wireless segment provides cellular mobile
development and sale, maintenance, and support services; solutions and systems integration
services; satellite communications services; and satellite information and messaging services.
This segment also delivers global system for mobile communication (GSM) capability for
the maritime sector, promotes the sale and/or patronage of debit and/or charge cards, and
trades in satellites and GSM enabled global telecommunication markets, as well as engages in
Internet broadband distribution business. Its Fixed Line segment offers fixed line
telecommunication services, such as local exchange, international long distance, national long
distance, and data and other network, as well as infrastructure and related services.
infrastructure and solutions for Internet applications, IP-based solutions, and multimedia content
delivery. This segment also provides knowledge processing and customer interaction solutions,
as well as operates Internet data center under the Vitro brand name; and offers Internet and
online gaming services. As of December 31, 2009, Philippine Long Distance Telephone
Company served 41 million subscribers. It also resells software licenses, server solutions,
RECOMMENDATION
The products of PLDT, like the DSL/broadband internet, can installed in the location of
its partners, like hotels, resorts, restaurants, shopping malls, and other places where most of the
people usually go. The broadband internet is quickly becoming one of the necessities,
People who are not yet familiar with PLDT broadband will be introduced to the product.
And if the public experiences the fast connection, they may also consider having that at their
As their product gets known to the people, PLDT will also earn from what is being
If the establishment doesn’t give a good impression to the public, then there will be
PLDT needs to cash out some money to install the devices in those establishments and
Market for other establishments with existing agreements with other competitors may no
longer be available
REFERENCES:
PLDT WBESITE
Wikipedia
Yahoo.com
Google.com
http://www.usnewslasvegas.com/business/pldt-group-to-develop-a-technology-to-
monitor-power-consumption/
http://www.manilatimes.net/business/pldt-warns-of-slowdown-until-2012/
http://www.thepoc.net/thepoc-features/mukhang-pera/mukhang-pera-news/1686-the-
battle-of-business-empires-rages.html
http://www.manilastandardtoday.com/2009/june/5/business5.htm