BAGUIO CITY – PLDT wireless subsidiary Smart Communications (Smart) posted a 38% hike in its mobile Internet revenues for the first three months of 2016, aligned with the strategy to raise revenue contributions from data and digital product segments.
The surge in Smart’s mobile Internet revenues is twice the increase that the telco posted during the same period last year, clearly showing the upward trajectory of the business. Smart posted 3.091 billion in mobile data revenues for the first quarter of 2016, or 38% more than the same period in 2015. This growth is double the 19% year-on-year increase in Smart’s mobile data revenues from the first quarter of 2015 (2.235 billion) versus the same period in 2014 (1.878 billion).
Mobile internet revenues now account for 30% of PLDT’s mobile data and broadband revenues, up from the same period last year.
“We are clearly pressing on with the shift to data as a revenue driver for the business. This quarter’s results show we are not only growing the revenues of mobile data – we are growing it twice as fast,” according to Ariel Fermin, PLDT and Smart executive vice president and head of consumer business.
Fermin cites increased smartphone adoption among subscribers and a strong subscriber appetite for digital services as the twin drivers for growth.
Almost half, or 45%, of the subscribers of PLDT’s wireless brands Smart and Sun are now using smartphones, up from only 30% last year. Smart also posted a robust, 51-percent increase in mobile data traffic within the network, equivalent to 32,618 terabytes worth of data for just the first three months of the year.
“As we continue to push smartphone adoption among our subscribers, we are at the same time stepping up our efforts to stimulate mobile data usage by offering the most relevant digital services,” Fermin said.
Compelling digital services
In the first quarter of the year, Smart broke ground in its drive to accelerate smartphone adoption when it offered the Smart Prepaid myPhone28 worth P888, with one year of free mobile data. In the range of more advanced devices, Smart offered the Samsung Galaxy S7 and bundled it with the Samsung Gear VR.
To encourage mobile data use, Smart has actively promoted a broad suite of digital content that’s accessible via smartphones. Called ‘Smart Life’, this package of services offers entertainment in various forms such as movies and videos on iFlix, music via Spinnr, books and magazines, and e-Sports via GameX, that may be paid for using one’s prepaid load or chargedto a postpaid account.Smart also partners with top apps like Uber and Airbnb for a complete suite of digital services for Smart subscribers.
Smart also introduced to the market more flexible and affordable data packages. The ‘Big Bytes Barkada’ allows ‘pasa-data’, where a user may share his or her data allowance with other users by passing it in minimum 50 MB chunks. Smart also offers ‘Shared Plan 999’, which provides three smartphones and three mobile numbers under a single account, that are capable of sharing 6 GB of mobile data volume per month. The volume allocation of all Big Bytes offers were also doubled, as in the case of Big Bytes 50, which for P50 already provides 700MB worth of data.
“These strategies are getting traction, as we are seeing aparallel rise in data traffic at 51%, and increase in revenues at 38%,” said Fermin, highlighting that subscribers are clearly willing to spend for mobile data services that’s relevant and meaningful to them.
He pointed out that about 83% of the users of Free Basics (formerly Internet.org), which Facebook first launched in the Philippines in partnership with Smart, eventually started buying data load packages in order to continue using the mobile Internet services that they like. This, in turn, has helped push the percentage of paying data users within the Smart network to grow from about one-third last year to around 50% of smartphone owners this year.
“Critical to all of this is our ability to provide the best customer experience when it comes to mobile data. Mindful of that, we are underpinning all of these initiatives with our drive to build and maintain a superior network as the foundation of our digital strategy,” Fermin said.
Faster mobile data speeds
To this end, PLDT and Smart have set aside about P43 billion in capex, the bulk of which is budgeted to boost internet services in the country, including the recently announced initial deployment of LTE-Advanced, also known as 4.5G.
Smart fired up earlier this month the country’s first LTE-A network in Boracay, using a capability called “carrier aggregation.” Carrier aggregation refers to the ability of LTE-A to combine two or more radio frequency bands in order to deliver bigger bandwidth and faster data speeds to mobile users.
“We are moving on several fronts – networks, devices, digital services, and data plans – to enable our customers to enjoy a Smart Life and truly live digital,” Fermin said.