VALUE CHAIN

A. Research

B. Production
Globe Telecom’s continued investment to enhance its network’s data capacities and
capabilities has resulted in overall capital expenditure spending of P19.0 billion as of the first six
months of 2019. Capital expenditure (capex) allocation for data-related requirements was around
75% of the total expenditures for the period. This was primarily to support the increasing demand
for data services and provide the most seamless experience to its customers. In the second quarter,
Globe reaffirmed its commitment to further improve the state of internet in the Philippines by
launching its Globe At Home Air Fiber 5G postpaid plans, making the Philippines the first country
in Southeast Asia to experience commercial fifth-generation (5G) fixed wireless broadband

C. Marketing
Globe Telecom is putting its strategy to promote digital transformation in the Philippines
into high gear. Globe’s aggressive fixed wireless home broadband strategy has pushed fast
broadband connectivity to a greater number of Filipino households in the past two years, with the
Philippine home broadband penetration rate hitting a milestone of 27% as of first quarter of 2019.
To connect more homes and businesses to the internet, Globe has been aggressively utilizing fixed
wireless solutions over airwaves to hurdle last mile challenges. Data from Kantar Philippines
showed the country’s home broadband penetration rate increased to 27% in the first quarter of
2019, from 16% in the same period in 2017.
The country’s impressive improvement in home broadband penetration rate comes
alongside the aggressive fixed wireless home broadband push of Globe. Globe’s fixed wireless
broadband subscriber market share also hit an all-time high of 84.4% in the first quarter of 2019,
from 76.9% in the same period in 2018. This was much higher than the 73.4% annual fixed wireless
broadband subscriber market share recorded in 2017.
Deploying fixed wireless solutions for homes has been a game changer for Globe. It
allowed the company to provide more homes with high-speed broadband as quickly and as
comprehensively as possible, according to Globe President and CEO Ernest Cu. Their fixed
wireless services have been redefining home broadband experience for Filipinos amid their
growing demand for bandwidth-intensive multimedia content.
In line with the company’s thrust to deliver fast, reliable, and affordable home internet to
more Filipinos, Globe in 2017 revolutionized the home internet space by being the first in the
Philippines to launch the Home Prepaid WiFi through a fixed wireless technology. Globe also
introduced the most affordable WiFi connection in the Philippines through the HomeSurf15
promo.
In December 2018, Globe launched a global innovation in home internet and entertainment
industry with Globe Streamwatch Xtreme Prepaid. This is the world’s first all-in-one device that
functions as an Internet modem, Set Top Box for streaming videos online, and access to clear local
TV channels that is reloadable.
Globe joined leaders of the global telecommunications industry by being the first in
Southeast Asia to commercially introduce 5G fixed wireless home broadband service in the
Philippines. This makes use of fixed location wireless radios instead of fiber and could provide
fiber-like speeds ranging from 50 Mbps to 100 Mbps.
Filipino households are set to benefit from Globe’s widespread adoption of wireless
broadband. While Globe continues its fiber rollout, its 5G deployment is a quicker and more
economical way to satisfy Filipinos’ fast-growing demand for data. This will help connect
households that are currently not connected to fiber-like internet speeds. These initiatives form
part of the company’s overall vision to bring the Philippines closer to first-world internet
connectivity.

D. Distribution
Globe has various sales and distribution channels to address the diverse needs of its subscribers.

1. Independent Dealers
Globe utilizes a number of independent dealers throughout the Philippines to sell
and distribute its prepaid wireless services. This includes major distributors of wireless
phone handsets who usually have their own retail networks, direct sales force, and sub-
dealers. Dealers are compensated based on the type, volume and value of reload made in a
given period. This takes the form of fixed discounts for prepaid airtime cards and SIM
packs, and discounted selling price for phone kits. Additionally, Globe also relies on its
distribution network of over 1.2 million “AutoloadMax” retailers nationwide who offer
prepaid reloading services to Globe and TM subscribers.

2. Globe Stores
As of 2019, the Company has over 200 Globe Stores all over the country where
customers are able to inquire and subscribe to wireless, broadband and fixed line services,
reload prepaid credits, make GCASH transactions, purchase handsets and accessories,
request for handset repairs, try out communications devices, and pay bills. The Globe
Stores are also registered with the Bangko Sentral ng Pilipinas (BSP) as remittance outlets.
In line with the Company’s drive to become a more customer-focused and service-
driven organization, Globe departed from the traditional store concept which is
transactional in nature and launched the redesigned Globe Store which carries a seamless,
semi-circular, two-section design layout that allows anyone to easily browse around the
product display as well as request for after sales support. It boasts of a wide array of mobile
phones that the customers can feel, touch and test. There are also laptops with high speed
internet broadband connections for everyone to try. The Globe store has an Express Section
for fast transactions such as modification of account information and subscription plans; a
Full-Service Section for more complex transactions and opening of new accounts; and a
Cashier Section for bill payments. The store also has a self-help area where customers can,
among others, print a copy of their bill, and use interactive touch screens for easy access
 to information about the different mobile phones and Globe products and services. Globe
stores also include NegoStore areas, which serve as additional sales channels for current
and prospective Globe customers. Moreover, select stores also have ‘Tech Coaches’ or
device experts that can help customers with their concerns on their smartphones. The
Company opened the first concept store in Greenbelt 4 in 2010 and accelerated its roll-out
throughout 2011, averaging 4-5 new stores a month.
In 2012, Globe introduced other store formats in response to the need for more
customer service channels to accommodate more subscribers availing of Globe postpaid,
prepaid and internet services. The new store formats - the premium dealership store, pop-
up store, microstore, kiosk, and store-on-the-go – were carefully designed based on
demographics, lifestyle and shopping behaviors of its customers, each providing a different
retail mix and experience to subscribers.
In 2013, Globe opened 50 concept stores and will open more concept stores in the
country as part of its commitment to a wonderful customer service experience.
In 2014, Globe simultaneously unveiled its Generation 3 flagship stores in SM
North EDSA, Quezon City, Manila and in Limketkai Mall, Cagayan de Oro. Designed by
Tim Kobe, the founder and CEO of Eight, Inc. and designer of Apple Stores, the Globe
Gen3 stores features reconfigurable and interactive elements, all designed to empower the
growing digital lifestyle of customers. The stores feature four lifestyle zones – music,
entertainment, productivity, and life – each with their own interactive kiosks.
Continuing with its journey of transforming customer experience, Globe opened
two more Gen3 stores in 2015. On July 2015, Globe opened its third Gen3 store in Ayala
Center, Cebu and on August 2015, opened its fourth Gen3 and first two-storey store in
Greenbelt, Makati.
In 2016, Globe opened its Flagship ICONIC store in Bonifacio Global City Central
Square Taguig. Designed by Tim Kobe of Eight Inc., the same designer of the Globe GEN3
stores, the Globe ICONIC store is the first all-in-one retail and entertainment space and
was launched in two phases. Phase 1 was completed in the June 2016 and featured the
entertainment space that will house shows, concerts, and a variety of on-ground events and
activities. Phase 2, completed in December 2016 features the complete Globe ICONIC
Store with a glass bridge that links two Globe stores from opposite sides of the BGC
Central Square.

3. Customer Facing Units

To better serve the various needs of its customers, Globe is organized along two
key customer facing units (CFUs) tasked to focus on the integrated mobile, Fixed Line
and international voice and roaming needs of specific market segments. The Company
has a Consumer CFU with dedicated marketing and sales groups to address the needs of
retail customers, and a Business CFU (Globe Business) focused on the needs of big and
small businesses. Globe Business provides end-to-end mobile and Fixed Line solutions
and is equipped with its own technical and customer relationship teams to serve the
requirements of its client base. Globe Business also caters to the international voice and
 roaming needs of overseas Filipinos, whether transient or permanent. Moreover, it is
tasked to grow the Company's international revenues by leveraging on Globe's product
portfolio and developing and capitalizing on regional and global opportunities.

4. Others
Globe also distributes its prepaid products SIM packs, prepaid call cards and credits
through consumer distribution channels such as convenience stores, gas stations,
drugstores and bookstores. Lower denomination IDD prepaid loads are also available in
public utility vehicles, street vendors, and selected restaurants and retailers nationwide via
the IDD Tingi load, an international voice scratch card in affordable denominations.