Philippine CDMA 3G competition looming

Somewhat related to my previous post about Windows Mobile 5 Palm Treo 700w being sold in Lanao del Norte, here is an article from Businessworld online about the looming competition between local telcos in providing CDMA2000 services.

Adopting CDMA seen to give telcos new revenue stream

With the much-hyped third-generation (3G) cellular service practically fizzling, would jumping into the next-generation fixed-line service give telecom providers the hoped-for new revenues?

Dubbed as the wireless local loop, the fixed-line service is built using the code division multiple access (CDMA) technology.

Christian Villareal, sales manager of CDMA gear maker ZTE Corp., said the company is wooing the country’s top three telecom companies — Philippine Long Distance Telephone Co, Globe Telecom, Inc, and Digital Telecommunications Phils., Inc. — to roll out the service.

ZTE is the same company that is planning to offer 3G handsets that could go as low as P10,000 per unit, much lower than today’s minimum price of P20,000.

Simply put, wireless loop subscribers will be able to make unlimited landline calls using CDMA-enabled mobile phones within a specific radius from a base station.

Here, Lopez-led Bayan Telecommunications, Inc. (BayanTel) — which is yet to launch its cellular service — was the first to launch the service in March, packaged under the brand, SPAN. SPAN is built on the infrastructure supplied by ZTE.

A SPAN user can make an unlimited number of calls or send a short messaging service or text to another user within a 2.5-km service radius.

This is available for an activation fee of P2,200 and a monthly fee of P749, including VAT, making CDMA rates cheaper than cellular rates. The service is now being offered in Marikina, Manila, Tacloban, General Santos and Davao.

CDMA is expected to generate 500 million users worldwide by 2010 from 300 million now.

"We are bullish about the prospects of SPAN given its high-value proposition of limited mobility with unlimited calling within the network. We hope to make the service more widely deployed in the next coming months, particularly in major cities outside of Manila," BayanTel chief executive consultant Tunde Fafunwa said.

ZTE’s Mr. Villareal said an unlimited wireless service offer is a potential new source for fresh revenues.

Smart and Globe had confirmed separately "the killer application," the come-on which they hope would bring in new 3G users, remains elusive.

Globe said it might take longer than two years before it could recover its investment in 3G.

For the first phase of the rollout, which will run until next year, Globe has allocated some $100 million in investments.

When asked if BayanTel is ready for the looming competition, Mr. Fafunwa said the company has already "assumed" the competition, but the company will continue to have the first-mover advantage.

Since the CDMA technology uses the existing fixed-line infrastructure of telcos, cost is not seen as a major barrier.

Source: BusinessWorld: I.T. Matters – News


2 thoughts on “Philippine CDMA 3G competition looming

  1. thanks for pointing this out (no name). I would have emailed the writer of this article but theres no email address indicated on the source webpage

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