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Mobile broadband still lagging in Philippines

Sector has surpassed fixed broadband in country but mobile broadband adoption still lower than other markets in region, say industry watchers.
Written by Melvin G. Calimag, Contributor

MANILA--While mobile broadband growth has outstripped fixed broadband penetration in the Philippines, telecom executives are baffled that the country still lags behind its neighbors in terms of wireless broadband adoption.

At the Philippine Telecom International Summit 2009 held here Friday, Jaikishan Rajaraman, senior director for services at GSM Association (GSMA), said it was interesting to note that the country only has "less than a million" users despite having launched 3G service three years ago.

"I'm curious to know the reasons as to why the adoption of mobile broadband has lagged behind here," said Rajaraman, in a press briefing after his presentation at the regional forum organized by research firm Frost & Sullivan.

The GSMA official then solicited answers from local reporters, who said Filipinos were still reluctant to use their 3G phones to connect to the Web due to cost and speed factors.

Leading landline operator PLDT and its mobile subsidiary, Smart Communication, have a combined broadband subscriber base of 1.2 million. About 700,000 of these use Smart Bro, which is comprised of fixed and wireless--via USB dongles--broadband users.

Main rival Globe Telecom, on the other hand, has 379,000 broadband subscribers, of which 180,000 are subscribers of its Globe Tattoo wireless plugin broadband service.

Another market player, Sun Cellular, has also rolled out its fixed and wireless broadband services but its subscriber base is still just a few thousands, and nowhere near the numbers of Smart and Globe.

While wireless broadband adoption--in the form of USB dongles or plugins--has surpassed fixed broadband in the Philippines, the use of 3G phones as a mobile broadband tool has yet to take off.

Nitin Bhat, Asia Pacific senior vice president for ICT practice at Frost & Sullivan, said during his presentation that the growth of mobile broadband has been impressive, but the challenges of fixed broadband economics are beginning to emerge.

Bhat pointed to the cutthroat pricing models and huge data traffic, particularly video, as two factors that may inhibit the proliferation of wireless broadband in the Philippines.

GSMA's Rajaraman, however, said the impact of mobile broadband in emerging markets is "deeply transformative", noting that remote areas now have the chance to harness the power of the Internet like their urban counterparts.

An organization that oversees the interest of GSM suppliers and operators, GSMA champions mobile broadband access via 3G, particularly HSPA (high speed packet access) technology, rather than wireless broadband platforms such as WiMax.

Rajaraman said there is often too much hype over the span of WiMax network coverage. "It's also not cheap [and] that's why there are very few users around the world. WiMax will have a hard time catching up [to 3G]," he said.

Melvin G. Calimag is a freelance IT writer based in the Philippines.

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