60 percent mobile phone penetration rate in the Philippines

The penetration rate of mobile phone subscribers in the Philippines is seen to climb to 70 percent by end of 2008, according to Globe Telecom president and chief executive Gerardo Ablaza.

Ablaza, speaking at the sidelines of the company's fourth quarter analysts briefing at Renaissance Makati Hotel yesterday, said this will be an improvement from about 60 percent subscriber identity module (SIM) penetration rate as of December 2007.

As of December last year, there were more than 55 million mobile phone subscribers in the country, representing over 60 percent of the population.

These included 30 million subscribers of Smart Commmunications, 20 million Globe subscribers, and more than 5 million subscribers of Sun Cellular, the mobile phone unit of Digital Telecommunications.

Ablaza said the mobile phone market is expected to expand by another 8 to 10 percent this year, on the back of the continuing growth of the wireless business as well as the extraordinary growth in broadband market.

Globe Telecom reported that its revenues rose 11 percent to P63.2 billion in 2007, as its subscriber base expanded by more than 20 percent while its broadband subscriber base rose 133 percent.

Other mobile phone operators such as Smart and Sun Cellular have yet to report their 2007 revenues.

Ablaza said the industry will continue to grow, but its pace will depend on developments in broader economy.

Analysts expect the strong peso, rise in crude oil prices and the uncertainty in the United States to weigh on consumer spending in the Philippines.

Ablaza said the strong peso, in particular, could affect the market segment of the overseas Filipino workers, whose earnings have been dwindling in peso terms.

The company, which is owned by conglomerate Ayala Corp. and Singapore Telecom, booked a record net income of P13.3 billion in 2007, up by 13 percent from a year ago.

Globe chief financial officer Delfin Gonzales said the company is allotting $400 to $450 million in capital expenditures this year, which will include investments in core mobile services, as well as wired and wireless broadband technologies.