Pourcines noted that there is a trend among service providers to merge and this is prompting equipment makers such as Alcatel and Nortel to likewise consolidate as the market gets smaller.

'It's a very competitive market where you have too many players fighting for the same market, so this is creating a wave of consolidation at the supplier level,' he said.

Developing market

Although Alcatel sees the acquisition as a way to build on an expanding UMTS market, Pourcines acknowledged that the Philippines is still a developing market in terms of 3G adoption.

'It will take time- with advertising and education - to entice users to use data services,' he said. According to the Alcatel official, the Philippines is a 'handset-driven market' where people buy 3G handsets to upgrade to the latest models than to avail of available 3G services.