PLDT looks overseas for content acquisitions

Philippine Long Distance Telephone Co (PLDT) is scouting for overseas opportunities as part of its convergence strategy after its failed acquisition of GMA7.

PLDT chairman Manuel V. Pangilinan last week told reporters that the company is looking beyond the Philippines for content providers, with an eye on global Internet companies.

Pangilinan said GMA7 is no longer on its "radar screen" after the controlling shareholders of GMA Network Inc agreed to sell a minority stake to San Miguel Corp president Ramon S. Ang.

When asked if Ang's deal with the GMA shareholders would put an end to the PLDT Group's attempts at investing in GMA-7, Pangilinan said: "It's not up to us, isn’t it? It takes 2 to tango."

PLDT saw the acquisition of GMA7 as a boon to the group's strategy of evolving from a traditional telecommunications company into a multimedia service company.

The PLDT Group has been aggressively expanding its media portfolio, starting with its acquisition in 2009 of Associated Broadcasting Corp, operator of what is now known as TV5, a distant third in a ratings war lorded over by behemoths ABS-CBN and GMA. InterAksyon.com is the online news portal of TV5.

Besides TV5, the PLDT Group also owns Cignal, a direct-to-home pay-TV service – both folded under MediaQuest Holdings Inc. The group likewise has acquired interests in the country's biggest newspapers --Philippine Daily Inquirer and Philippine Star – as well as in niche broadsheet BusinessWorld.

PLDT expects to meet its core net income target in the first half of the year of P19.75 billion on the strength of its broadband business. For the entire 2014, the company is targeting a P39.5 billion core net income.

PLDT's core profit, which excludes foreign exchange transactions and other non-recurring items, went up by 2 percent to P9.8 billion in the first quarter this year from P9.6 billion in the same 3 months of last year.

Portable mobile broadband, network service upgrades behind PHL telecom growth in 2013 - IDC

Thanks to portable mobile broadband and upgrades in network service, the Philippine telecom market grew steadily in 2013, market intelligence firm IDC said Thursday.

But IDC said mobile services driven by mobile broadband and value-added services are likely to drive growth in the next five years.

"The growth momentum in the next five years will largely come from mobile services, driven by mobile broadband, mobile Value Added Services (VAS), and customized mobile applications. Mobile operators are heavily focus on mobile broadband strategy as they have rolled out full overage of 3G services and starting to roll out 4G network across the archipelago," said Ashadi Cahyadi, senior research manager for IDC Asia Pacific.

IDC said revenues from the telecommunications sector amounted to $5.012 billion in 2013 - two percent higher than the previous year.

Driving the demand in telecom services in the Asia-Pacific market that includes the Philippines is the development or expansion of multinational corporations in the region.

"With fast-growing bandwidth demand and increasing price pressure, usage is expected to increase fast while ARPUs of most services across fixed line and mobile will be on a slow decline. Over-The-Top (OTT) applications are cannibalizing the revenue of some core traditional telecom services such as messaging and voice calls," IDC said.

Cahyadi added that while IDC expects positive revenue growth, the main challenge is how the mobile broadband strategy "can support customer retention and loyalty program in a market of predominantly prepaid mobile users."

IDC noted overall forecasts remain optimistic, although conservative, at a CAGR of 4 percent.

Next 5 years

Sherrie Huang, research manager for IDC Asia/Pacific, said fixed line telecom services may be defined in the next five years by bandwidth upgrade, service improvement, migration from standalone basic communications.

They may also involve connectivity offerings toward managed solutions and bundled packages for fixed line telecom services, she added.

"IDC recomemends that the telecom service provider (SP) community reviews their offerings portfolio and examine the ROI of the services especially those basic, legacy, or standalone services. SPs need to strengthen their managed and professional services capabilities, and come up with innovative solutions and integrated/bundled packages/offerings to remain competitive, rather than continue selling the same portfolio with standalone communications and connectivity services," Huang said.

She added SPs have "to closely monitor market trends and technology evolution to ensure they remain on the right track."

Bigger fines for poor mobile phone, slow Internet services in Philippines

Rep. Arnel Ty said due to widespread consumer complaints of slow Internet access, as well as recurring blocked or dropped mobile phone voice calls,House Deputy Minority Leader now said he is batting for an administrative fine of up to P50 million for telecommunications companies that fail to comply with directives to improve their services.

“We are pushing for new legislation that will revise and update the financial punishment that regulators may impose on telecommunications companies that are unable to live up to mandatory quality of service standards,” Ty said in a statement sent to the regional newspaper Mindanao Examiner.

He said at present, the National Telecommunications Commission may exact a fine of only up to P200 per day on telecommunications companies offering services that do not meet quality benchmarks. The amount is based on a 78-year-old law, the Public Service Act of 1936 and as a result these companies would rather risk paying the paltry fine, than upgrade their services.

“There are bills seeking to raise the maximum fine to any amount, as may be deemed appropriate by the NTC, provided it shall not exceed P50 million,” he said.

Citing the Consumer Act of 1992 - to protect the interest of consumers, including mobile phone and broadband subscribers, promote their general welfare, and to establish standards of conduct for business and industry - Ty said he favors the classification of broadband or high-speed Internet access as a “basic service,” along with voice calls and text messaging.

“We are pushing for universal broadband service. Government’s goal should be to ensure that all citizens have access to high-speed Internet service at a fair price,” he said, stressing the need to renew the telecommunications laws to make them highly responsive to rapidly evolving new technologies.

“In the case of broadband, we have to enable the NTC to push for greater public access to the service via minimum quality standards and reasonable user rates,” he said, adding, at present, high-speed Internet access is being treated as a value-added service, meaning its speed and price are supposed to be dictated by the free market.

Ty also filed House Resolution 186 calling for a congressional inquiry into the deteriorating services of telecommunications companies. He said that a growing number of consumer complaints received by the NTC pertain to blocked calls (denied access by the network), dropped calls (involuntarily disconnected), delayed call set-up, inadequate reception, and deficient broadband services.

Besides the poor signal quality wherein voice transmission in an ongoing call becomes choppy or garbled, Ty also cited complaints that it takes a long time for subscribers to get the first ring after dialing a called party.

“The degraded services may be due to extreme congestion. It would appear that telcos have been taking on an incremental number of subscribers every quarter, without building up their networks fast enough, their huge earnings notwithstanding,” he said.

PLDT rolls out 5,000 new 4G stations

Leading multimedia and telecoms provider Philippine Long Distance Telephone Co. (PLDT) has rolled out 5,000 new 4G (fourth generation) base stations as it continues to rapidly expand its fixed wireless and mobile broadband network all over the country.

PLDT president and chief executive officer Napoleon Nazareno said the deployment of new long term evolution (LTE) base stations would bring ultra-fast wireless connectivity to nearly all cities and municipalities in the country in the coming months.

“This aggressive expansion of our LTE network is part of our thrust to provide broadband connectivity to the whole country,” Nazareno said.

According to Nazareno the PLDT is aggressively rolling out of both LTE and Time Division-LTE (TD-LTE) as it looks at a 50 percent coverage by the end of the year.

“By the end of this year, we should be hitting about 50 percent coverage for LTE.

We are now maybe about 30 percent,” he stressed.

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He said the expansion complements the efforts of the PLDT Group to provide connectivity to all Filipino homes through fixed lined services including the fiber-to-the-home (FTTH) and the Next Generation Network (NGN) services.

PLDT’s wireless subsidiary Smart Communications Inc. launched its mobile LTE service in 2012.

PLDT has so far fired up 2,000 base station for fixed wireless version of LTE since April this year to provide high-speed wireless broadband services to homes via its service PLDT HOME Bro Ultera that provides speed of up to 10 Mbps.

Originally offered in Metro Manila, PLDT executive vice and HOME Business Group head Ariel Fermin said the PLDT HOME Bro Ultera is now available in provincial areas from as far as Cagayan province in northern Luzon and Davao del Sur in Mindanao.

Fermin said the take up of the PLDT HOME Bro Ultera has been phenomenal.

“This new service revolutionizes the country’s internet experience as it enables more Filipino families to gain ready access to multimedia services like social media, movies, games, and music,” Fermin said.

This LTE to the Home service utilizes TD-LTE, one of the two wireless data transmission technologies that fall under the international standard of LTE.

PLDT Technology Group head Rolando Peña said the ultra-fast TD-LTE has maximum speeds per individual user of up to 42 Mbps that is almost six times faster than WiMax and 21 times more than Canopy.

The deployment of more LTE base stations would also enable Smart to expand its high-speed mobile broadband service.

The PLDT Group decided to raise its budget for capital expenditures this year to P32 billion from P29 billion to put up base stations that could withstand strong winds after Super Typhoon Yolanda battered provinces in the Visayas last November.

This year’s budget would also be used to attain a 100 percent 3G (Third Generation) coverage, build more LTE sites, expand its fiber optic network to about 100,000 kilometers, a new international cable system, among others.

In 2013, PLDT spent P28.8 billion for capital expenditures last year, 21 percent lower from P36.4 billion in 2012.