Converge Pushes to Provide Broadband Connectivity in Unserved Areas, Granted Tax Incentives Until 2026

Telecommunications service provider Converge ICT Solutions Inc. was recently granted tax perks until 2026 by the Fiscal Incentives Review Board (FIRB) in an effort to aid its missionary connectivity initiative of offering high-speed broadband connections in 1,200 undeveloped and underdeveloped areas nationwide.

For the next four years, the telco firm will receive income tax holidays, which will be followed by five years of enhanced deductions or special corporate income tax under the CREATE Law. Converge is also set to be granted duty-free importation of capital equipment, raw materials, spare parts, or accessories for 11 years beginning from November 2021.

The company is, likewise, eyeing to expand the coverage areas under its license, but this is still subject to approval. Nonetheless, it will be rolling out Fiber-to-the-Home infrastructure which includes the establishment of a terrestrial backbone, distribution networks, ports, and routers in the sites it currently covers.

Converge aims to provide higher capacity and faster data transmission as it utilizes the latest technologies for its digital infrastructure. This nationwide project forms part of the 2020 Investments Priorities Plan as it is categorized as a strategic service in the telecommunications sector, which is recognized by the FIRB. Improving broadband connectivity throughout the country is also among the priority sectors under the government’s long-term vision AmBisyon Natin 2040.

“We’re glad that the government appreciates the cutting-edge technology we will be using to bring broadband connection to underdeveloped areas,” said Converge CEO and co-founder Dennis Uy. “We’ve always believed that connectivity is a right, not a privilege of a few. With this investment in the network, we will be allowing more Filipinos to exercise this right.”

“We look forward to the opportunities that this project will open up for our countrymen, especially in the rural areas,” added Uy, noting that the project is also geared to generate direct and indirect jobs. Converge looks to address the digital divide prominent in the country as access to fiber broadband has been considered to be “dismally low” at just 17%, significantly lower compared to other ASEAN countries which have attained upwards of 40%.

By 2025, broadband internet penetration has been targeted at 65% for middle-income countries like the Philippines, according to the Broadband Commission for Sustainable Development. Around 95% of new Converge subscribers have been found to be first-time high-speed broadband users as part of the company’s effort to reach unserved markets. Over the past two years, Converge’s subscriber base has seen consistent growth starting from 529,629 subscribers at the end-2019 to more than 1 million in 2020, and, finally, reaching 1.8 million as of end-March 2022.

Source: Manila Bulletin