Ranopa, Jan A.

4 BLM

Chapter 1

Introduction

A. Basic information of the company and its business

Globe Telecom, Inc. is the number one mobile company in the Philippines. They provide cellular,
broadband and mobile data services, recognizing the growing preference of our customers towards
content-rich offerings and multimedia applications that enrich the Filipino digital lifestyle. Globe
Telecom is supported by seven thousand one hundred eighty employees; with over one million one
hundred thousand retailers, distributors, suppliers and business partners nationwide. Globe Telecom
operates one of the largest most technologically-advanced fixed line and broadband networks which can
be used by consumers in any form like individual small or medium enterprise as well as corporations.
Globe telecom has risen to become the country’s leading mobile company.

A1. Name of the company:

Globe Telecom Inc.

A2. Nature of the business

Globe Telecom Inc. is a Communication service provider which provides the public mobile
telephone, prepaid promos, and fixed-line telephone and broadband services. Globe Telecom is not the
ultimate producer but they give mobile telephone to encourage consumers to use their network. In
fixed-line telephone globe provides landline telephones and broadband internet for home and pocket
Wi-Fi for traveling.
A3. Location of head office

Globe telecom Inc.’s head office is located in Globe Tower, 32nd Street corner 7th Avenue
Bonifacio Global City, Taguig. Metro Manila Philippines but it has lot of branches nationwide. This tower
is designed by JojoTolentino of Aida Philippines.

A4. Rationale in choosing the company

The student chooses Globe Telecom Inc. because he is a subscriber of the company. The student
also has interest to the company because he is interested on how the company operates.

B. Basic background of the company.

Globe Telecom Inc. known today partnered by Singapore Telecom Inc. was known as Globe
Wireless Limited in January 16 1935 until 1992.Globe Telecom inc. is a company that provides wireless
communication nationwide under Globe postpaid or prepaid, Touch mobile and Globe Tatoo pocket
data used for Wi-Fi. Globe Telecom Inc. has 11 Board of Directors and one of them is Ernest L. Cu which
is also the president and the Chief Executive Officer of the company, He served as a Globe Director since
2009. In 2016, Mr. Cu was named as the best Chief Executive Officer by Finance Asia for the third time
since 2010.

C. Affiliation of the company

Globe Telecom is associated with Singapore Telecom or also known as Singtel, Singtel group is
Asia’s leading communication group and Ayala Corporation also leading in its country and in the region.
Globe is also member of Bridge alliance, a partnership of thirty four mobile operators from asia-pacific,
Middle east and Africa.

D. Response to Globalization

Globe Telecom Inc. Exert effort to create their lasting contribution to the society, they worked
with key partners Singtel and Optus to bring Digital Thumbprint Program in the Philippines this Digital
Thumbprint Program is brought here in the Philippines to educate our youth on responsible digital
citizenship this is achieved through workshops namely digital insight, digital impact, digital ambition, and
digital truth. Digital insight promotes cyber awareness in security and safety of the youth, digital impact
helps the youth to be responsible and to teach the youth of the online etiquette, digital ambition help to
promote cyber leadership and empowerment while digital truth helps the youth to have critical thinking
skills and data critiquing.

E.) Environmental Sustainability

For the Environment, Globe Telecom invested more than two million pesos for reforestation
programs, solid waste management in their corporate offices; hazardous waste disposal and treatment.
Globe also donates seedlings to non-profit organization like Hineleban Foundation which advocates
environmental conservation and livelihood. Globe also set up e-waste recycling bins called Project
1Phone (P1P) stations at Globe stores to entice our customers to return electronic products and
accessories that have reached end of life to further promote environmental awareness and protection.
Globe works with Total Environment Solutions Asset Material Management, through its local arm TES-
AMM Philippines, on recovering precious metals and plastics for remanufacture from the disposed
gadgets. Aside from responsibly collecting and recycling our operations’ electronic wastes, Globe
continued to expand the scope of this program by initiating stronger partnerships with Huawei
Technologies Philippines, BPI, Accenture, LeadSurf Data Marketing, Unionbank, Oxfam, among others;
and exceeding our target of collecting and recycling e-waste. Globe’s efforts in energy and waste
management across all Globe sites are reflected in their compliance records and certifications they fully
comply with the Department of Environment and Natural Resources, Department of Labor and
Employment, and Department of Health, AdministrativeOrders, Republic Act 8749, the Philippine Clean
Air Act; Republic Act 9136, Electric Power Industry Reform Act of 2001; Republic Act 9003, the Ecological
Solid Waste Management Act; and Republic Act 6969, Hazardous Waste Management Act; Attained
certifications, namely the Quality Management Systems (ISO 9001:2015), Environmental Management
System (ISO 14001:2004 and ISO 14001:2015), and Occupational Health and Safety (OHSAS
18001:2007).
 Chapter 4

EXTERNAL ANALYSIS

POLITICAL AND SOCIO-ECONOMIC RISKS our growth and profitability may be influenced by the overall
political and economic situation of the Philippines. Any political instability in the Philippines could
negatively affect the country’s general economic conditions which, in turn, could adversely affect our
business, financial condition or results of operations, including the ability to enhance the growth of its
customer base, improve its revenue base and implement its business strategies.

General Environment

The general environment comprises political forces, economic forces, social, cultural, and
demographic forces, technological forces, environmental forces, and legal forces.

4.1. Political Forces

Political forces determine the extent of influence of the government’s different policies to a certain
company or industry. Tax policies, stability of the government, regulations, social policies, and trade
regulations are some of political and governmental forces that may affect an industry.

4.1.1. Duterte Administration

The newly-elected administration is seen to bring potential changes that can positively or
negatively affect the telecommunications industry. These includes pressure to improve network
performance,possible pressure on pricing, potential entry of foreign telecom players, potential
improved LGU support, promise of increased infrastructure spend A regular environmental scanning
exercise is performed to ensure the identification of any uncertainties arising from political and
socioeconomic factors. Management is closely monitoring the shift in policies to anticipate the potential
impact to the business plans as well as maintaining open communication lines with the various
government sectors. President Rodrigo Duterte’s plan of opening the communication to foreigners is
one factor that could affect the company which could largely affect the growth of the company.
4.2. Economic Forces

To carry out effective strategic plans for a corporation, economic factors or the health of the
country’s economy should be taken into consideration. A corporation should give attention to the
country’s levels of Gross Domestic product, Interest, Taxes, And Business and consumer confidence.

4.2.1 Gross Domestic Product Growth Rate

The Philippines GDP expanded 1.3 percent quarter-on-quarter in the September quarter of
2017, following an upwardly revised 2.0 percent growth in the June quarter. The figure came below
market estimates of a 1.6 percent expansion, as the services and the industry sectors grew at slower
paces while the agriculture contracted.

In the third quarter, the services sector rose 1.5 percent, slower than a 1.9 percent rise in the June
quarter. Also, the industry sector went up 1.4 percent, easing from a 2.4 percent expansion in the
previous three months. Meantime, the agriculture, hunting, forestry and fishing contracted by 0.8
percent, after a 1.6 percent increase in Q2.

Year-on-year, the economy expanded an annual 6.9 percent, following an upwardly revised 6.7 percent
expansion in the previous quarters and above consensus of a 6.5 percent growth. It was the strongest
growth since the September quarter 2016.
4.2.2 Gross Domestic Product from Services

GDP From Services in Philippines decreased to 1229016 PHP Million in the third quarter of 2017
from 129066 PHP Million in the second quarter of 2017. GDP From Services in Philippines averaged
917311.25 PHP Million from 2008 until 2017, reaching an all time high of 1226677.13 PHP Million in the
fourth quarter of 2016 and a record low of 675416.60 PHP Million in the first quarter of 2008.

4.2.3 Consumer Confidence

Consumer Confidence in Philippines decreased to 9.50 in the fourth quarter of 2017 from 10.20
in the third quarter of 2017. Consumer Confidence in Philippines averaged -17.54 from 2007 until 2017,
reaching an all time high of 13.10 in the second quarter of 2017 and a record low of -52.80 in the third
quarter of 2008.
4.2.4 Philippines Internet Speed

Internet Speed in Philippines increased to 5450.74 KBps in the first quarter of 2017 from
4527.48 KBps in the fourth quarter of 2016. Internet Speed in Philippines averaged 1886.55 KBps from
2007 until 2017, reaching an all time high of 5450.74 KBps in the first quarter of 2017 and a record low
of 795.57 KBps in the third quarter of 2009.

4.2.5 Philippines Corporate Tax Rate

4.3. Social Forces

4.4. Technological Forces

4.5.1 Mobile Phones

 Number of mobile phone users in the Philippines from 2014 to 2020 (in millions)

 Philippines’ mobile engagement

 Mobile Internet and Mobile Broadband Subscription in the Philippines

 Mobile phones have evolved over time and there has been a large increase in the use of these
devices. Mobile users in the Philippines have embraced and adapted the new services of the mobile
devices. Phones back in early 2000s are only capable of texting and calling services but now that
technology has progressed a lot, it expanded the services it can offer. Everyone, at any time can access
to the Internet with the use of their mobile phones and this has increased the number of individuals
who are actively using the Internet through their phones. It is evident that the mobile devices were not
left behind in the continuing technological development.

4.5.2 IT Governance and Cyber Security

Globe recognizes that IT risks such as technology shift risk, change program risk, competition
risk, cyber threats, data privacy and business disruptions remain part of our top risks, which is why we
have set out practices and procedures to address these including, but not limited to, partnering with
relevant institutions such as the Philippine Disaster Recovery Foundation (PDRF). Unlike most
organizations, we have our Information Security and Data Privacy Division (ISDP) which is a fully
operationalized, independent group that focuses on Globe’s privacy and cybersecurity matters. The
appointment of our Chief Information Security Officer (CISO) and Data Privacy Officer (DPO), Mr. Anton
Reynaldo M. Bonifacio, further establishes Globe’s adherence to the country’s Data Privacy Act of 2012
(Republic Act 10173). Mr.Bonifacio also leads ISDP and reports directly to our CTIO together with our
CTO, for complete governance and enforcement of policies especially those in relation to cybersecurity
and data privacy.
 Globe, through the leadership of our Board of Directors, invests generously to ensure that our
cybersecurity programs are effective. We fully acknowledge the different issues, concerns and
regulations that are inherent given a very active digital world. Globe sees these as opportunities for
cooperation and collaboration with both private and public entities in achieving sustainable quality
business.Among its activities on cybersecurity, Globe has been running a 3-Year Cybersecurity
Transformation Program since 2014. We are now on the tail-end of its completion and have launched
the next phase, which will be another 2-Year initiative. In March 2017, Globe launched the Globe
Advanced Security Operations Center (ASOC), a state-of-the-art cyber-security center dedicated to
protect Globe and our customers' data amidst an increasingly hostile digital environment. Our ASOC is
linked to more than 1,600 cyber security professional worldwide and houses the infrastructure and
teams which deliver customer service, platform management, threat detection, threat hunting and
incident response for both Globe and our customers.

4.5.3 Internet Peneteration by Country

Internet penetration in the Philippines on year 2017 is at 58% of the total population
4.5.5 Time allocated on internet

Filipinos spend the most time on the internet with an average total of 8.59 hours per day which
5.23 hours per day using a laptop or desktop and the remaining3.36 hours of internet usage was spent
using mobile phone or mobile devices. It shows that Filipinos really do embrace social media, mobile
phones as well as internet.

4.5. Environmental Forces

4.5.1 Working on waste management

 Globe Business also takes significant steps in lowering solid waste, electronic waste (e-waste),
and hazardous waste from products and operations to reduce impact on the environment. Last year,
Globe Business helped launch its wide-scale e-waste recycling program via Project 1 Phone to build
schools in Aklan made from old mobile phone parts.

By spearheading Project 1 Phone, Globe Business led the biggest e-waste recycling program in the
country, encouraging clients to take active part by donating old phones during caravans in their
respective companies. Project 1 Phone was instrumental in building schools in Aklan, which was badly
hit by Typhoon Haiyan in 2013. The program ultimately helped Globe as a company generate more than
P8 million in funds to rebuild classrooms in the said province.

4.5.2 Encouraging energy optimization

Globe Business also harnesses environmental sustainability initiatives starting with its own
portfolio of products and services which encourage tempering carbon dioxide in the environment. Its
teleconferencing solutions and collaboration tools for instance reduce the need for road travel and
flights, indirectly cutting down CO2 emissions. The innovative Canvas software also pushes for a
paperless workplace, cutting down the need for printing documents to save trees as a result. By
promoting the use of the Google suite of applications, especially Gmail, businesses can save up to 172.8
kW of energy as well as 101.6 kilograms of carbon per user yearly as they use a cloud service rather than
those running on local servers.

The business segment of Globe also manifests care for the environment with its world-class data
centers. They operate with recent global industry certifications, such as ISO 14001 for Environmental
Management System, Occupational Health and Safety Management Systems 18001:2007 in one facility,
and an ISO 14001:2014 certification in another. Other initiatives cover cost reduction in electricity
consumption to more than P30 million in 2014.
4.6. Legal Forces

Every state has unique regulations that guide licensing requirements, incorporation procedures
and labor issues.

4.6.1 AN ACT CREATING THE DEPARTMENT OF INFORMATION AND COMMUNICATIONS TECHNOLOGY,

DEFINING ITS POWERS AND FUNCTIONS APPROPRIATING FUNDS THEREFOR, AND FOR OTHER
PURPOSES

SEC. 2. Declaration of Policy. – It is hereby declared the policy of the State:

(a) To recognize the vital role of information and communication in nation-building;

(b) To ensure the provision of £ strategic, reliable, cost-efficient and. citizen-centric information and
communications technology (ICT) infrastructure, systems and resources as instruments of good
governance and global competitiveness;

(c) To ensure universal access to quality, affordable, reliable and secure Id’ services;

(d) To promote the development and widespread use of emerging ICT and foster and accelerate the
convergence of ICT and ICT-enabled facilities;

(e) To ensure the availability and accessibility of ICT services in areas not adequately served by the
private sector

(f) To foster an ICT sector policy environment that will promote a broad market-led development of the
ICT and ICT-enabled services (1CT-ES) sectors, a level playing field, partnership between the public and
private sectors, strategic alliance with foreign investors and balanced investments between high-growth
and economically-depressed areas;

(g) To promote and assist the development of local ICT content, applications and services which may
include support for ICT-based start-up enterprises through strategic partnerships;

(h) To promote the use of ICT for the enhancement of key public services, such as education, public
health and safety, revenue generation, and socio-civic purposes;
(i) To encourage the use of ICT for the development and promotion of the country’s arts and culture,
tourism and national identity;

(j) To promote digital literacy, ICT expertise, and knowledge-building among citizens to enable them to
participate and compete in an evolving ICT age:

(k) To empower, through the use of ICT, the disadvantaged segments of the population, including the
elderly, persons with disabilities and indigenous and minority groups;

(l) To ensure the rights of individuals to privacy and confidentiality of their personal information;

(m) To ensure the security of critical ICT infrastructures including information assets of the government,
individuals and businesses; and

(n) To provide oversight over agencies governing and regulating the ICT sector and ensure consumer
protection and welfare, data privacy and security, foster competition and the growth of the ICT sector.

4.6.2 REPUBLIC ACT No. 7925 AN ACT TO PROMOTE AND GOVERN THE DEVELOPMENT OF PHILIPPINE
TELECOMMUNICATIONS AND THE DELIVERY OF PUBLIC TELECOMMUNICATIONS SERVICES

Section 5 Responsibilities of the National Telecommunications Commission - The National

Telecommunications Commission (Commission) shall be the principal administrator of this Act and as
such shall take the necessary measures to implement the policies and objectives set forth in this Act.
Accordingly, in addition to its existing functions, the Commission shall be responsible for the following:
Lawphil&159;

(a) Adopt an administrative process which would facilitate the entry of qualified service providers and
adopt a pricing policy which would generate sufficient returns to encourage them to provide basic
telecommunications services in unnerved and underserved areas;

(b) Ensure quality, safety, reliability, security, compatibility and inter-operability of telecommunications
facilities and services in conformity with standards and specifications set by international radio and
telecommunications organizations to which the Philippines is a signatory;
(c) Mandate a fair and reasonable interconnection of facilities of authorized public network operators
and other providers of telecommunications services through appropriate modalities of interconnection
and at a reasonable and fair level of charges, which make provision for the cross subsidy to unprofitable
local exchange service areas so as to promote telephone density and provide the most extensive access
to basic telecommunications services available at affordable rates to the public;

(d) Foster fair and efficient market conducts through, but not limited to, the protection of
telecommunications entities from unfair trade practices of other carriers;

(e) Promote consumers welfare by facilitating access to telecommunications services whose

infrastructure and network must be geared towards the needs of individual and business users;

(f) Protect consumers against misuse of a telecommunications entity's monopoly or quasi-monopolistic

powers by, but not limited to, the investigation of complaints and exacting compliance with service
standards from such entity; and

(g) In the exercise of its regulatory powers, continue to impose such fees and charges as may be
necessary to cover reasonable costs and expenses for the regulation and supervision of the operations
of telecommunications entities.