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Globe on SIM swap
(Businessworld)

Globe expects to save P300 million every quarter this year by pulling out of the SIM-swapping race.




Ayala-led Globe Telecom, Inc. said it will stop offering of swapping subscriber identification module (SIM) cards due to high costs.
This followed an announcement from rival Philippine Long Distance Telephone Co. of quitting the offering.

Globe expects to save P300 million every quarter this year by pulling out of the race.

Gerardo C. Ablaza, Globe chief executive and president, told the company’s stockholders yesterday the average revenue per user (ARPU) generated from Globe users fell due to high acquisition costs.

Globe said postpaid acquisition cost per subscriber reached P8,872 for the first quarter, higher than P8,340 the year before.

For prepaid subscribers, acquisition cost was pegged at P226 and P87 for its second mobile brand Touch Mobile.

High acquisition costs however did not result in higher revenues per subscriber. ARPU dipped in the first quarter, largely due to low margins from data and voice revenues.

Net ARPU for postpaid subscribers inched back to P1,524 from P1,612 the year before.

For prepaid users, net ARPU decreased 30% to P250 from P357 for the same period in 2004. For Touch Mobile, net ARPU was slightly up 2% to P192 from P189 last year.

Mr. Ablaza said revenues from the net additions of subscribers from SIM-swapping activities will be compensated by a restructured packaging of wireless value-added services.

Applications in the pipeline will be streamed through multimedia messaging system, G-Cash - the mobile commerce offering of Globe - and General Packet Radio Service, a wireless communication standard for browsing the internet and sending of electronic mails.

"It is difficult to see big bursts in revenues toward the fourth quarter," Mr. Ablaza said. "We have to make the most out of our subscriber base and earn from them."

Globe had about 12.9 million subscribers as of the end of the first quarter, with a net addition of only 442,000 users.

By end of the year, the company wants to expand its network to cover 95% of the 82 million population and 87% of all 16 regions.