MOBILE PHONE WAR

The National Telecommunications Commission (NTC) called for an emergency meeting last Feb 7 among the top officials of cellular phone service companies Globe, Smart and Sun Cellular in an apparent bid to avert a war over Sun’s marketing strategy.

At the meeting arranged by NTC Chairman Ronald Solis were Innove president Gil Genio, representing Globe Telecoms; Smart Communications chief executive officer Norberto Nazareno, and Sun CEO Lance Gokongwei and his uncle, Digitel director James Go.

The closed-door meeting started at 3 p.m. and was still ongoing by 7 p.m., when Solis reportedly had food sent into his office at the NTC headquarters in Quezon City.

Solis called the meeting after news broke out that Globe and Smart, through their subsidiaries — Innove and Piltel, respectively — filed petitions with the NTC asking the commission to issue a cease-and-desist order against Sun’s "24/7" service, which offers unlimited calls and texting among Sun-to-Sun subscribers per month for an additional P250 for pre-paid and post-paid subscribers.

The service allows subscribers unlimited local Sun-to-Sun calls and texts. Post-paid plan holders can subscribe to the service by paying a minimum fee of P250 every month on top of their current plans while pre-paid subscribers can load P100 valid for 10 days and load option of P250 valid for 30 days.

Innove and Piltel claimed Sun was practicing "predatory" or cut-throat competition pricing in offering the "24/7" service.

The complainants wanted the NTC to set all call rates at P5.50 per minute and bar Sun Cellular from charging much lower rates. Globe and Smart currently charge roughly P4.50 per minute.

The service, originally offered as a promotional campaign by Sun, was made permanent following its success in luring thousands of new customers. The promo has been popular among college students and low-income consumers.

The success of Sun’s "24/7" service drove the company’s subscriber base to 1.1 million as of end-December last year.

In its complaint, Globe’s Innove claimed Sun had employed "predatory pricing" in its promotional gimmick, branding it as "an anti-competitive measure employed by a dominant company to get/protect market share from new or existing competitors."

For its part, Smart’s Piltel said that its rehabilitation program was compromised by Sun’s 24/7 service due to the "unwarranted action of Digitel in importing rates arbitrarily."

Sun Cellular is the trade name of Digitel Mobile Philippines Inc., a unit of listed Digital Telecommunications Phils. Inc., owned by tycoon John Gokongwei.

Digitel’s 24/7 plan, according to Piltel, was destroying the "fundamental or basic market pricing considerations when it has priced its service at a level where no new market entrants in the cellular market can still compete, and that any losses Digitel may incur at the moment may be recovered later on when it has severely weakened its competitors and successfully driven them out of the market."

Piltel claimed Sun’s pricing scheme threatens its viability in the already crowded cellular market.

"Digitel charges Piltel a wholesale rate of P4.50 per minute access charge to its network, while its own subscribers have an unlimited retail access to its own network at P250 a month, or P100 every 10 days," Piltel said.

"Piltel by itself is charging its subscribers an average retail P5.50 per minute and has not embarked on an atrocious wholesale pricing scheme," the firm added.

Analysts noted the net additions of both cellular phone companies suffered due to marketing efforts of Sun Cellular which attracted a substantial number of new users due to its unlimited call and short messaging services for additional fees on top of a subscriber’s prepaid load or postpaid plan.

Smart and Globe are the two dominant cellular firms with more than 95 percent of the market.

Compared to these two giants, Sun Cellular is a very small competitor with less than five percent of the market, Digitel officials said.

================================

As of Friday 6pm Feb 11, 2005, TV Patrol annouced that NTC did not allow suspension of 24/7 promo by Sun, the next hearing for the case is scheduled on March 7, 2005

ZERO NDD

In a meeting between Telecom Board Chairman Edwin J. Piano and PilTel Manager Sonny Danoog held this afternoon at PilTel office, Mr. Danoog confirmed that he had indeed submitted a resignation that may take effect March 31, 2005. He however clarified that the top management has not yet acted on the letter. He further informed Chairman Piano that a meeting will be held on Tuesday February 15 at PLDT main office and that the "One Rate One Province" implementation at Olongapo City, Subic Bay Freeport and Province of Zambales will be discussed.

Bill filed to protect SIM card holders from syndicates

To crack down on mobile phone robbery syndicates, a congressman filed a bill requiring telecommunications companies to store identity profile of all Subscriber Identity Modules (SIM) card holders in the country.

But as early as now, telcos and a consumer group are opposing the plan, saying that not only the move would result in logistical problems for telcos but it would also be a step closer to resurrecting the much-opposed National ID System in the Philippines.

Congressman Simeon L. Kintanar (2nd district, Cebu) proposed in House Bill 3497 that all SIM card holders present Professional Regulations Commission certificates and other valid cards to the National Telecommunication Commission (NTC) for proper identification.

Mr. Kintanar argued that SIM card registration will let telcos deliver to proper addresses the monthly billing statements of all pre-paid and post-paid mobile subscribers.

He added that listing of SIM cards would likewise reinforce the government's thrust of countering mobile phone robbery.

Currently, the government blocks the International Mobile Equipment Identification from a mobile phone network if phones were reported to have been stolen or lost.

NTC said that there have been a total of 25,492 reported cases of stolen or lost phones in 2002, which declined to 16,954 in 2003.

Over 28 percent of 80 million Filipinos have SIM cards as of September 2004.

Globe Telecoms Inc. however opposed the plan. Globe legal counsel Froilan M. Castelo told Congress this week that registration will require maintenance of database servers and even additional manpower costs to implement.

Mr. Castelo said that the proposed "logistical nightmare" would also be unreasonable as most mobile carriers sell SIM cards to distributors who may not have the money to invest in servers.

Philippine Long Distance Telephone Company (PLDT) on the other hand said that the proposed SIM registration would slow down purchase of SIM cards.

"This can be complied with but it is subject to the the operators' capability and policy," PLDT said in a statement.

The sentiments of the two telcos were supported by consumer group TXTPower, which said that registration of SIM cards would entail huge accounting and "humongous" administrative costs that telcos can easily pass on to subscribers.

"It will be an overkill. If the policemen cannot catch petty carnappers even if licenses are registered with the Land Transportation Office, we cannot be sure that policemen can catch mobile phone robbery syndicates through registration of SIM cards. It is a step closer to the National ID System," TXTPower founder Anthony Ian Cruz told Congress.

Proponents of National ID System argued that this system will let Filipinos use a single ID to avail of government services. A few years back however the project has been met with strong opposition from the public as well as lawmakers, who said that national ID can infringe on privacy of individuals.

AGENDA 4th Telecom Board Meeting

Republic of the Philippines
TELECOM BOARD
OLONGAPO CITY

AGENDA

4th Telecom Board Meeting
February 14, 2005
9:00 Am

1. Prayer
2. Roll Call
3. Reading and adoption of Minutes of 3st Telecom Board meeting
4. Order Of Business
a.) City Computerization Program – c/o Mr. Sunny Basobas
b.) Accomplishment report – c/o Engr. Ebue and Mr. Nards Perez
PABX update and Cell site inspection
c.) Draft Guidelines / Internal Rules for Olongapo City Telecom Board - c/o Hon Gina Perez
5. Other matter
a.) Meet with Mayor Bong Gordon Jr., February 15, 2005 3pm
6. Calendar of next meeting
7. Adjournment





HON. EDWIN J. PIANO
Chairman
TELECOM Board

CITY HALL TELEPHONE DIRECTORY

By dialing below listed telephone numbers,
callers may be able to contact all offices
within the City Hall Complex:

222-2206, 224-8390, 222-2845, 222-2699
222-3301, 224-6329, 222-2661, 222-5401

Callers can simply ask the operator to be
connected to a specific person or the caller
may also give the LOCAL number as indicated.

MAYOR BONG : : LOCAL>> 4444
MAYOR’S OFFICE STAFF 4000
MAM ANNE GORDON 4201
MAYOR’S OFFICE STAFF ( MON) 4206
MAYOR’S OFFICE STAFF ( JIMMY L.) 4204
MAYOR’S OFFICE STAFF (ERNIE) 4207
MAYOR’S OFFICE ( LEIZEL) 4208
MAYOR’S OFFICE RECEPTION AREA 4209
VICE MAYOR’S STAFF 4234
SANGUNIAN SECRETARY 4233
SESSION HALL 4236
KGD. NOEL ATIENZA 4221
KGD. CYNTHIA G. CAJUDO 4222
KGD. TED DEL ROSARIO 4223
KGD. BELLA ASUNCION 4224
KGD. BEBETH MARZAN 4225
KGD. HALLY ANDRADA 4226
KGD. BRIAN GORDON 4227
KGD. ELMO AQUINO 4228
KGD. EDWIN J. PIANO 4229
KGD. GINA PEREZ 4230
KGD. NOLI CAPISTRANO 4231
KGD. ROBINE ROSE BUENAFE 4232
SANGUNIAN STAFF 4218
SANGUNIAN STAFF 4219
SANGUNIAN MAIN LINE (MLX 10) 4102
ACCOUNTING OFFICE 4311
ASSESSOR’S OFFICE (Dept. Head) 4125
ASSESSOR’S OFFICE STAFF 4126
BUDGET OFFICE 4309
BUSINESS CENTER 4139
BUSINESS PERMIT DIVISION 4130
C.O.A. 4305
CITY ENGINEERING’S OFFICE (Architect Luz)4302
CITY ENGINEERING’S OFFICE (Dept. Head) 4301
CITY ENGINEERING’S OFFICE (Maintenance)4328
CITY HEALTH (Dept. Head) 4147
CITY HEALTH STAFF 4134
CITY POPULATION OFFICE 4136
COMELEC 4238
CPDO (Dept. Head) 4215
CPDO STAFF 4213
D.I.L.G. 4304
D.S.W.D. 4303
DESK SGT (POLICE) 4166
DPWH
ESMO (Dept. Head) 4313
ESMO Staff 4314
FIRE DEPARTMENT
FMA HALL
G.S.O. 4214
INFORMATION LOBBY GROUND FLOOR 4129
LABOR CENTER 4150
LEGAL OFFICE (Dept. Head) 4210
LEGAL OFFICE STAFF 4240
M.I.S OFFICE 4239
PERSONNEL OFFICE
PHIL. HEALTH 4151
PHIL. NATIONAL POLICE STA. 1 (Desk Sgt.)4166
PHIL. NATIONAL POLICE STA. 1 (Head) 4176
PLEB
PUBLIC AFFAIRS OFFICE (Dept. Head) 4200
PUBLIC AFFAIRS OFFICE STAFF 4241
PUD (Dept. Head) 4122
PUD BILLING (1ST Floor) 4124
PUD POSTING (3RD Floor) 4307
PUD STAFF 4123
REALTY TAX SECTION 4133
REGISTRAR OFFICE 4132
SENIOR CITIZEN OFFICE
SMED
STATION COMMANDER 4176
SUGPO 4171
TOURISM OFFICE
TRAFFIC MANAGEMENT BOARD (TMB) 4177
TRAFFICE MGT.BUREAU 4177
TREASURER’S OFFICE 4127
TREASURER’S STAFF 4128

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