Nokia sees saturation point at 50% of population

[silver_corolla]

Nokia, the country’s most popular mobile phone brand said that wireless penetration rate would hit a saturation point once the number of Filipinos owning a mobile phone handset has reached 42 million, or 50 percent of total population.

That would be six million away from the current number of subscribers of 36 million.

Nokia country general manager Parikshit Bhasin said the trend in the industry now is upgrading handsets.

"The market is moving towards an upgrade from black and white to color screen; text messaging to multi-media service; from an ordinary phone to a camera-phone and consumers are more aware of the use of warranty period," he said

The Nokia official said it would be up to the cellular operators to address the impending decline in subscriber growth so as not to affect their revenues.

"It is up to them to address this and not us mobile phone makers," said Bhasin.

At present 36 million Filipinos have cellular phones. They represent 43 percent of the total population of 84 million.

Smart Communications Inc., has 58 percent of the market with 20.5 million subscribers. Rival Globe Telecom follows with 13.6 million cellular subscribers, representing about 38 percent of the market. The remaining four percent belongs to Sun Cellular, the cellular band brand name of the Gokongweis.

Bhasin said there will be a plateau in subscriber growth once penetration rate hits 50 percent. Subscriber growth, he added, in the past several months comes from the D and E markets.

"The growth will not be as rapid as it was in the past. There will be opportunities and expansion in the cellular market but the comfortable level will stay at 50 percent," said Bhasin.

Globe estimates that penetration rate will hit 50 percent by year end.

Following this prediction, the downward trend in subscriber additions is expected to be more pronounced.

Smart already saw increasing churn rates coming as it added only 537,000 new subscribers in the second quarter. This is 49 percent lower than the one million recorded in the first quarter this year and 68 percent lower than the 1.7 million activations recorded in the second quarter of last year.

Smart president Napoleon Nazareno attributed the decline to the SIM-swapping activities. Though he said this promo, in itself, is not expected to affect the company’s underlying revenues.

The Smart official said it would be focusing on achieving growth not in subscriber base and but on increasing revenues.

"We will be looking at promos that will enhance usage in the field of entertainment and information on demand. Also, to further address demand in the lower end of the market, we will come out with promos relevant to micro payments," said Nazareno.


Globe meanwhile said the company’s programs for the remaining months of the year, which will include the completion of a persuasive nationwide network, is said to be critical to Globe’s competitiveness.

"To manage the pressure that this puts on our cost-revenue equation, we need to significantly reduce the lag between the time to toll out new sites and generating revenues from them," said Globe president Gerardo Ablaza.

Moreover, Ablaza said the company will "re-engineer cost structures by finding new and better ways of doing things."

Capital expenditures reached P8.7 billion year-to-date, about half of the allotted budget this year.

"We will pursue innovation to improve our revenue streams, by creating products and offering services that promote greater usage and utility of the mobile phone, especially among mass market consumers," Ablaza said.

[Tacoma_34]

grabe few years ago 7% pa lang ang penetration. Tapos ngayon dami churn.