PLDT forms shared digital services company called Digico

PLDT [TEL 1278.00 ?0.9%] [link] said yesterday that it has created “a new digital entity” called Digico that will act as a “platform for a serious [MVP Group]-wide digitalization effort”. Digico will be co-owned by TEL, Smart, Meralco [MER 365.20 ?0.5%], and Metro Pacific Investments (MPI), which the disclosure referred to as the “MVP Group of Companies”. According to TEL, Digico is expected to facilitate “payments and rewards systems” for users and “be ‘the app’ for all Filipinos”. Referring to the Filipino people, Manny Pangilinan (MVP) said that “your growth is a priority for us”, and followed this up by saying that Digico “will serve as a catalyst that could unlock new revenue streams and drive incremental value.”

MB BOTTOM-LINE: Lots of big companies have shared services teams like this, especially for IT assets and services. Why make each company spend the time and money to roll its own payment processing system when those efforts could be concentrated on delivering one system capable of handling the entire group’s needs? Makes sense on paper. Building this digital infrastructure also makes it easier for the MVP Group of Companies (is it just me, or is it kind of wild to refer to these companies in this way?) to grow new subsidiaries or pursue new customer-facing opportunities knowing that they’ve already got this part of the challenge solved: just plug the new company into the existing digital platform and away you go.