Phone Firms Balk at Order to Extend Prepaid Loads (Manila Standard Today) 09 July 2009

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Phone firms balk at order to extend prepaid loads

By Fel V. Maragay

LEADING mobile phone service providers yesterday refused to commit to followinggovernment orders extending the validity of their prepaid credits.

At a meeting of a Senate technical working group, officials from SmartCommunications, Globe Telecom and Digitel Mobile Philippines said they were stillstudying the impact of the new order from the National Telecommunications

Commission.

Last week, the commission ordered the phone companies to extend the validity of their prepaid credits starting July 19, but the telecommunications executives saidthey doubted if this was possible given the “technical adjustments” they wouldhave to make.

In a separate circular, the commission banned the carriers from sending unsolicitedpromotional or advertising messages through mobile phones, a move that marketresearch company Nielsen Media said would shackle the growth of mobileadvertising.

Roy Ibay, Smart Communications senior manager, said they were surprised by thecommis-sion’s twin directives.

“We are still trying to [determine] the impact of the two circulars on our

operations, although the second one is addressed to the content providers,” Ibaytold newsmen after the meeting.

He said they had the option to appeal to the commission to give them more time.

Rodolfo Salalima, Globe Telecom’s chief legal counsel, said the new order onprepaid credits would hurt the company because it would cut profits and entailadditional expense to make changes in their billing software.

“The entire machinery have to be engineered to attune ourselves to the extendedvalidity of the load,” he said.

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Salalima said the commission should consider the right of service providers underthe law to realize a reasonable rate of return. He said they were likely to file amotion for reconsideration.

Commission chairman Ruel Canubas ruled out the possibility of recalling the orderand said the carriers had been given enough time to comply.

“With the new guidelines, necessarily they have to adjust the system,” he said.

Canubas said if the carriers wanted to seek a temporary restraining order, that wastheir right, but those defying the order would be sanctioned and fined P200 foreach day of violation.

Senator Mar Roxas, chairman of the committee on trade and commerce, said theorder to lengthen the validity of the prepaid load was too late and not enough toaddress consumer demand for a fair and equitable deal from the carriers.

He said his committee would push for the per-second metering on voice calls, aspracticed in other countries.

He welcomed the order prohibiting unsolicited promotional messages, but saidthere were other reforms thatmust be be implemented to protect cell phone users.

At a news briefing yesterday, Nielsen Media said the new order against “push” messages would hurt the mobile advertising industry.

“It will have a large impact on mobile advertising, which is a growing industry,” said Jay Bautista, executive director of the advertising research firm.

Eric Barrera, a researcher at the same firm who presented the results of a study onmobile phone users, said many companies were looking at the potential of mobileadvertising in the Philippines.

“A mobile phone is now a multi-media device. About 61 percent of the 10.4 millionresidents of Mega Manila who are 10 years old and up now own cell phones,” hesaid.

Bautista said a company using European technology was even planning tointroduce a mobile advertising service that would give subscribers free voice callsand text messaging in exchange for advertising.

He said the company had a pending application before the NationalTelecommunication Commission. “We don’t know yet if their application will beapproved,” he said.

Nielsen and advertising firm Trackworks disclosed the results of a survey of 100mobile phone users, who were at the same time commuters of LRT and MRT trains,from July 4 to 6 this year. The respondents were part of the mobile panel service of Nielsen, with a total of 1,000 members.

The survey found that aside from voice calls and text messages, about 30 percentof the respondents used their phones for Internet browsing, 12 percent for music,16 percent for chat, 16 percent for e-mail, and 12 percent for games.

In a separate study of MRT-LRT Travel Habits, Nielsen cited the big potential of train advertising. More than 52 percent of Filipinos in Metro Manila were mobile, itsaid.

“About five million passengers take the MRT and LRT trains each week, and manyof them are income earners who are more likely to go to malls, dine out in fastfood outlets and devote time to entertainment and sports,” Bautista said.

Bing Kimpo, vice president of Trackworks, said the results of the study could beused to attract more advertisers at the LRT and MRT stations.

About 30 to 40 companies were already placing ads at these stations, he said.With Roderick T. dela Cruz


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Phone Firms Balk at Order to Extend Prepaid Loads (Manila Standard Today) 09 July 2009

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