CURE for a telco’s tumultuous history

Right from the start, something was already amiss with U Mobile and so I was not surprised when the company, now renamed Red Mobile, changed its name and eventually discarded its ad-supported business model that was supposed to be the first in Asia.The sudden change of name and business model were announced not through a press conference or a formal launch, but with advertisements and calls from telephone agents who informed subscribers that they will be given new SIM cards.

Right from the start, something was already amiss with U Mobile and so I was not surprised when the company, now renamed Red Mobile, changed its name and eventually discarded its ad-supported business model that was supposed to be the first in Asia.

The sudden change of name and business model were announced not through a press conference or a formal launch, but with advertisements and calls from telephone agents who informed subscribers that they will be given new SIM cards.

Red Mobile's "original" owner was an oddly named company called CURE, short for Connectivity Unlimited Resources Enterprises. Despite being a virtual unknown, CURE was able to snatch a 3G license in 2006 alongside the big guys--Smart Communications, Globe Telecom, and Sun Cellular.

It would not long, however, before CURE's financial capability was put into question. When it became obvious that rolling out a 3G network was way beyond its powers, CURE put itself on the trading block and was readily gobbled up by Smart for 420 million pesos (US$8.6 million). Please check out my earlier blog on this topic.

If you noticed, the word original is in quotation marks above. It's because even if Smart had already bought it, CURE was--and still is--listed as the operator behind, first U Mobile, and then Red Mobile, as indicated in its Web site.

When U Mobile was launched, I was eagerly anticipating how it would roll out its free 3G service and how the public would react to it. The ad-funded business model, I thought, was something really unique.

But I sensed something strange. During the carrier's commercial unveiling the service in May this year, I didn't see anyone from Smart--the company's parent company. How could an organization, even if it was operating separately, afford to have a formal public launch without the real owners in attendance?

That was something that I should have taken as a cue, but, looking back now, I should have recognized that as part of the writings on the wall. To most observers, it only reinforced the assumption that Smart had no intention of seeing its mobile subsidiary succeed, since it was only interested in CURE's 3G license and that CURE was only after money it wanted to gain from its 3G license.

My latest information is that Ardie Balderrama, the top executive who presided during the launch of U Mobile, and his whole team were asked to leave (or fired?) by Smart when it re-launched the company as Red Mobile.

I would love to see Red Mobile, with its claim of having the lowest rates in town, become the top 3G operator in the country. But with its troubled and problematic history, I doubt that will ever happen.