Smart acquires 40% stake in Primeworld Digital Systems

MANILA, Philippines – Smart Communications Inc., the wholly-owned wireless subsidiary of Philippine Long Distance Telephone Co. (PLDT), has acquired a 40-percent stake in local Internet service firm Primeworld Digital Systems Inc. (PDSI).

Company officials said subject to various regulatory approvals, Smart plans to increase its ownership of PDSI to 100 percent within the year.

The acquisition is intended to strengthen Smart’s leading position in the wireless broadband business, they added.

Established in 1996 as one of the pioneering Internet service providers (ISPs) in the country, PDSI has evolved into a telecommunications company specializing in IP communications services such as premium Internet connectivity, data center services, VPN, VOIP and managed security.

Smart said PDSI has established a reputation for excellent customer service with a nationwide client base of government and educational institutions, and medium to large corporations. The company also owns and operates its own wireless local loop network.

PDSI operates under a legislative franchise granted in 2001, to provide telecommunications services throughout the Philippines and between the Philippines and other countries and territories, including mobile, cellular, wired or wireless telecommunications systems and their value added services.

It also has a provisional authority to build and operate an information and data communications network issued by the National Telecommunications Commission.

Earlier, PLDT reported that its wireless service revenues rose to P23.9 billion in the first quarter of 2009, six percent higher than the P22.5 billion realized in the same period last year. The group’s total cellular subscriber base for the first quarter of 2009 grew to 36.9 million subscribers, a 17 percent growth year-on-year.

SmartBro, Smart’s wireless broadband service - through its wholly-owned subsidiary Smart Broadband Inc. – continued to expand as its wireless broadband subscriber base grew 71 percent to reach 596,000 at end-March 2009, 183,000 of which were on SmartBro’s prepaid service.

Wireless broadband revenues grew 40 percent to P1.3 billion, a significant improvement over the P919 million recorded in the first quarter of 2008.

“Smart continues to explore all means in making Internet access as affordable and accessible as possible. Our research shows that our Internet traffic has been growing 80 percent annually since 2006, proving that Internet access is fast becoming an indispensable communication tool. Whether via the cellular phone, PC, or any mobile Internet device, we aim to provide our subscribers with a faster and richer broadband experience,” Smart chief wireless adviser Orlando Vea said.