Local 3G users to reach 1.6M by 2012 – Smart

Smart Communications expects the number of third-generation mobile communications (3G) subscribers to grow significantly to 1.6 million by 2012 as more mobile users get wirelessly connected to the Internet and the cost of 3G phones drop.

Based on submissions to the National Telecommunications Commission (NTC) furnished The STAR, Smart said the number of subscribers for HSPA850 (3G frequency) is projected to increase from 200,000 in year one (2008) to 1.6 million by year five (2012).

Just recently, Smart officials said that there are now over 1.2 million 3G-enabled handsets in their network with around 500,000 regular users.

Smart has high hopes on the future of 3G that it acquired last March 25 from the Ongpin group the entire issued and outstanding capital stock of PH Communications Holdings Corp. and Francom Holdings, which collectively own 100 percent of Connectivity Unlimited Resources Enterprises (CURE) for P419.54 million.

In addition, Smart is acquiring up to 40-percent stake directly in CURE and is investing up to P210 million in the form of subscription of new shares of the company. Smart officials explained that the investment is necessary to provide CURE with funds for its commercial start-up this month.

CURE is one of the four licensees awarded by the NTC with a 3G frequency in December 2005. Other awardees include Smart, Globe Telecom, and Digitel Mobile.

According to Smart president and CEO Napoleon Nazareno, the acquisition dovetails with Smart’s plan to provide expanded and enhanced 3G services nationwide, including higher speed wireless broadband services.

CURE is envisioned to provide Smart with a platform to offer and provide differentiated 3G services for targeted markets. CURE and Smart have entered into a facilities management agreement that will allow the former to utilize part of Smart’s network especially for the provincial areas. CURE’s own network, on the other hand, will cover Metro Manila.

In dousing apprehensions from some quarters about the future of 3G in this country as well as in explaining Smart’s decision to acquire CURE and expand its 3G network and coverage as well as, Smart chief wireless adviser Orlando Vea noted that the benefits of new technologies are often overstated in the short term and understated in the long term.

“3G has gone through this phase of hype, then a period of disappointment. Globally, we are now entering 3G’s realistic phase. 3G is now wirelessly connecting mobile users to the Internet and to rich content. Smart’s 3G usage and subscriber takeup follows this marked trend and will continue to rise as cost of devices drop. Content gets more compelling, and the user community grows,” Vea, former president of Smart before it was acquired by the First Pacific Group, said.