Dropped calls, delayed texts? Globe readies solution

 

MANILA, Philippines – To all Globe users experiencing dropped calls and delayed text messages, the company hopes to get a “Cure” for your problems.

Globe CEO Ernest Cu said the solution will be a package of network upgrade and additional frequencies.

Cu explained that the delayed messages and failed calls consumers are getting have “a lot to do” with cell site congestion.

“As you know, when all of these services compete for the same radio resource, which would be SMS, voice and data traffic… The competition or congestion will [cause a] delay,” he said.

High network traffic is nothing new to Globe, especially since its mobile subscriber base has been growing by double-digits in the last two years.

What changed is that more of these consumers are now using data-heavy smartphones.

The transition to smartphones has been rapid explained Globe Advisor for Consumer Business Peter Bithos. 

“Approximately 60% of all handsets sold in the Philippines were smartphones in the 4th quarter of last year. Of that 60%, 80% were Android. If you work the math, half of all the phones sold in the Philippines were Android smartphones in the 4th quarter of last year.” 

He said Globe had estimated that within the next three years, smartphones would be half of all the phones in the country.

Bithos said, “It doesn’t matter where you are, the uptake of smartphones is dramatic.” 

Bidding for Cure

At the same time, Globe hasn’t added new frequency spectrums, a move that could decongest the network traffic.

Globe Chief Technical Adviser Robert Tan likened frequency spectrum to pipes. If SMS, voice calls and data are particles of water, the frequency spectrum is the pipe they rush through.

Globe wants to add more “pipes” and one of them is held by “Cure” or Connectivity Unlimited Resource Enterprises Inc., which is owned by rival Philippine Long Distance Telephone Co. (PLDT).

Globe currently holds 10 megahertz of spectrum, while PLDT has 35 Mhz, which will be reduced to 25 when it sells the 10 Mhz third-generation (3G) license of Cure.

PLDT must sell all its rights and interests in Cure as part of the conditions set by the National Telecommunications Commission in approving PLDT’s acquisition of third-ranked Digital Telecommunications Philippines Inc. (Digitel) in October last year.

Cu admitted they need Cure for future demand.

“In all seriousness, we do need (Cure). We do think a bigger highway will be required to the increasing number of subs (subscribers) that Globe will have and more specifically the number of subs that will be on smartphones.”

He explained that getting Cure is crucial for Globe’s high-end market.

Globe initially cornered the premium postpaid market, but Digitel’s Sun Cellular later catched up. PLDT unit Smart, meanwhile, has been strong in the mass market.

“Globe does have a premium base, as you know we have close to 1.6 million post paid subscribers and a very dominant share of revenues is in that particular segment. So therefore those particular consumers are going to ask us to supply even faster services in the future and that is directly proportional to the amount of spectrum you have,” said Cu.

Cu said Globe would “bid aggressively” for Cure, which will be instrumental in helping the company gain market share form PLDT.

“Of course your product, as in the network that we have, should be in top form to compete with a very strong incumbent,” he said.

“The difference in the gap (in market share) is quite large. We had a narrower gap before they acquired the third player but we expect… to continue to be an aggressive challenger with the objective of continually gaining share in this market,” he added.

Network upgrade

Also vital in ensuring Globe can handle the onslaught of smartphones and improve its services is the company’s $790-million network modernization program, which includes upgrading and adding new cell sites.

Of the $790 million, 80% will be spent between 2012 and 2013, and the remaining 20% disbursed over the next three years, explained Globe Chief Financial Officer Albert de Larrazabal. 

This year, meanwhile, Globe plans to spend $750 million for operations and capital expenditures. 

Larrazabal said Globe will raise P10 billion through the issuance of 7- and 10-year retail bonds in June to fund the capex.

The spending and planned improvements can’t come too soon for a company itching for more market share, and customers who are tired of delays. – Rappler.com