3G has been hyped as the next generation in wireless services, enabling faster transmission of data and therefore allowing telcos to offer rich multimedia services such as video conferencing, audio and video streaming, and mobile Internet.
While there is no doubt that the technology to make all this happen is already in place, the four players -- Smart Communications Inc., Globe Telecoms Inc., Digital Telecommunications Inc., and newcomer Connectivity Unlimited Resources Enterprise Inc. (CURE) -- are quick to acknowledge issues such as handset availability and content as they begin competing for 3G subscribers.
Some of these players have also hinted at how they intend to deploy 3G within the next two to three years.
Smart, which currently has the largest mobile subscriber base at more than 20 million, was awarded the largest radio frequency bandwidth of 15MHz x 2 and had the first crack at choosing preferred frequency bands after scoring the highest among the four players in NTC's grading system.
It chose the 1920-1935MHz/2110-2125MHz-frequency spectrum (or channels 1, 2, and 3). 'We will maximize the use of this radio frequency spectrum we have selected in order to deliver the optimum quality of 3G services to our customers,' said Rolando Pe'a, Smart's network services division chief, in an issued statement.
Globe, meanwhile, settled for 1945-1955MHz/2135-2145MHz (or channels 6 and 7). Digitel was awarded frequencies 1935-1945MHz /2125-2135MHz while CURE, which scored the lowest in NTC's grading system, was assigned 1955-1965MHz/2145-2155MHz.
NTC awarded the said frequencies in a recent closed-door meeting with representatives from the four companies.
5MHz edge?
Ramon Isberto, spokesperson for Smart, a subsidiary of Philippine Long Distance Telephone Company (PLDT), noted in an interview that the company was able to choose the 'cleanest, most efficient' channels with the least interference from other frequencies.
'If you look at broadcast radio, for example, the major stations are located in the lower frequencies,' he said. 'In the case of 3G, this allows our consumers better access to our services and for us to provide these services at better quality.'
According to industry sources, the extra 5MHz of bandwidth given to Smart can accommodate around 20 to 25 million subscribers, or theoretically, about half more than the other players. But according to its competitors, this does not spell an automatic business advantage for Smart.
Atty. Rodolfo Salalima, Globe Telecom's senior vice-president for corporate and regulatory affairs, downplayed Smart's larger frequency bandwidth, noting that it boils down to 'realistically perceiving demand.'
'Right now, we have nearly 30 million mobile subscribers and that number can be readily accommodated by two channels. Not everyone will readily move to 3G,' he said in a separate interview. 'Talking about advantages, there is none.'
Eric Recto, CURE's official representative during the NTC meeting, also agreed that there is no need for the additional channel, although he added that 'something else is afoot and Smart may have something up its sleeve.'
For his part, Smart's Isberto said this allows the company flexibility to 'deploy 3G where most needed.' He noted that the rate of rollout would depend on subscriber take-up.
He added, 'We (Smart) were the first to focus on provincial deployments. We will continue that (with 3G) and our deployment will be nationwide.'
New entrant
Meanwhile, CURE's Recto said his company would focus first on deploying in urban areas -- where there is a larger concentration of subscribers -- in order to get the most out of its investments.
'Initial investment in technology is usually high and decreases over time. We don't intend to go full force early but do it in a subdued manner,' he said. CURE expects to cover 90 percent of the country's municipalities within five years.
Hong Kong-based operator Hutchinson Whampoa Ltd. is reportedly eyeing to invest in CURE, which was confirmed by a legal counsel for the company in an interview during the sidelines of the NTC meeting.
But Recto neither confirmed nor denied the report, only describing CURE as a company backed by an investment group led by businessman and former Department of Trade and Industry secretary Roberto Ongpin. The company has no experience as a mobile operator but was previously a player in the prepaid Internet card business.
Onset of handsets
With 3G becoming more imminent, these players are hoping this would encourage handset makers not only to make more affordable 3G mobile phones but also to make them more readily available in the Philippines.
Handset makers like Nokia and Sony Ericsson, for example, have already introduced WCDMA (the standard that supports 3G) handsets locally but these handset models still cost more than US$200 or approximately P20,000.
CURE's Recto said the company is looking at partnering with manufacturers to subsidize the cost of 3G handsets. Meanwhile, Smart's Isberto noted plans by Chinese manufacturer Huawei Technologies Co. Ltd, to come up with 3G-capable handsets priced at around $100.
'Now that 3G operators (in the Philippines) have licenses, hopefully more handset models would be coming in,' Isberto said.
3G trials
Dominant players Smart and Globe have been conducting 3G trials since last year and are expected to beef up their infrastructure further this year.
After NTC awarded 3G licenses late December, Smart has begun the deployment of its 'nationwide 3G network,' with a number of its cell sites nationwide tested and utilized for demonstration to subscribers in key areas in Metro Manila and Cebu.
Globe, meanwhile, demonstrated its capability during the recent Southeast Asian Games wherein live video streams were shown to the public using 3G technology.
Although not as pronounced as Smart and Globe, Digitel, which broke the duopoly and became the third industry player, is likewise looking to rollout 3G services within the year.
'We are currently finalizing our technical plans for the 3G rollout. We're almost done conducting trials for our 3G offering which we hope to offer anytime within the year. We've also been upgrading our base stations and improving our network capacity,' William Pamintuan, Digitel senior vice president, said in an interview.
He added Digitel is in the process of negotiating interconnection and roaming agreements with other service providers, including co-location of network facilities in order to offer its services nationwide.
Digitel is investing around $200 million to upgrade its network from 2.5G to 3G, Pamintuan added. 'We are also currently eyeing probable 3G infrastructure providers.'