Piltel suffers from identity crisis

While its sister company Smart Communications Inc. is enjoying huge subscriber uptake, Pilipino Telephone Corp. (Piltel) suffers from an "identity crisis" both for its analog and digital cellular phone networks.

All AsiaCapital Securities noted in a recent assessment of Piltel, that the company only had an additional 1,338 subscribers in one year for its digital service based on the US-developed code division multiple access (CDMA) technology.

Even Piltel's analog network was not spared from the company's proof performance. Using another American developed standard, the advanced mobile phone system (AMPS), Piltel merely had 78,555 new customers in 1999.

All Asia pointed out that the results showed very low percentage increases as compared with other digital operators using Europe's global system for mobile communications (GSM) platform.

In fact, Smart reported that for January and February this year, it attracted an average of 100,000 subscribers per month.

"Piltel continued to bleed and suffer an identity crisis on the type of product position it should pressure. Mobiline digital and analog subscribers manifested weak growth as compared with other operators with digital service," All Asia said.

With the so-called "Generation Text" dominating cellular phone subscription, the group said Piltel with its CDMA minus the highly-popular short message system (SMS), will find it hard to sell unless the SMS service is adopted.

However, SMS service would entail huge cost and Piltel's parent firm, the Philippine Long Distance Telephone Co. (PLDT) is not willing to spend on it.

"Increased subscriber base is the only way for Piltel. With its upcoming marketing blitz, the former front-runner may be able to regain its composure," All Asia said.

So far, though, PLDT has no plans to make Piltel abandon either its analog or digital network despite moves to consolidate its operations with that of Smart.

Instead, PLDT president and chief executive officer Manuel Pangilinan said that high-end Piltel customers will be convinced to shift to Smart's GSM service.

Piltel currently has about 450,000 mobile phone subscribers, with barely 50,000 of which using digital. Moreover, an estimated 70 percent of the company's analog customers are into prepaid.

The cash-strapped firm had dominated the Philippine cellular phone market for several eyars before being saddled by issues of cloning and bad debts which made it lose not only a huge amount of money but also public confidence.