Lopezes not giving up on Extelcom

The Lopez Group is not yet giving up on Express Telecommunications, noting that there are enough opportunities in the wireless phone industry for other players.

Benpres Holdings chief operating officer J. Xavier Gonzales said Extelcom, despite trailing behind industry leaders Smart and Globe can still compete in the cellular business if it can catch up with the advancement in technology.

The merger of Globe and Islacom and the close affiliation between Smart and Piltel further downgrades Extelcom's standing in the cellular race. Extelcom, the pioneer in cellular technology in the country, has long given up its leadership to the more aggressive new players.

Extelcom has some 140,000 subscribers, of which 110,000 thousands are in the lower-margin prepaid card subscription. In contrast, both Smart and Globe have touched off the one-million subscriber-mark in their cellular base.

Holding company Benpres owns Bayantel, which has a 47-percent stake in Extelcom. Gonzales said while the Lopez group has remained passive investors and has not figured prominently in the firm's management -- controlled by the combined forces of Millicom Holdings and GMA Network -- the transition toward a more "Filipinized" management team led by former Unisys Philippines head Benny Quiblat could lead to more positive changes for the company.

Gonzales said the country's wireless phone industry is characterized by three distinct trends. Foremost is the constant change in the leadership among the companies, with Piltel giving way to Smart, then to Globe, then Smart again.

In addition, the churn rate for cellular is much faster than landlines since the mobile units are more accessible, handy, and have more advanced features. They have also became much cheaper. "Technology is the great leveller," he added, noting that from the analog or TACS units, cellphones have shifted to digital features (GSM and CDMA) and would move on to the next stage of 3G or third generation technology that converges audio, video and the Internet in the phone units.