Globe, Smart and the Mad Rush to 3G

Following the news of 3G investments from big business, the a former NTC head, Catanduanes Rep. Joseph Santiago, questions the “˜mad rush’ for 3G.

He is puzzled by the NTC’s over-enthusiastic push for 3G when, according to industry players themselves, conditions are not ripe for the new technology.

Santiago noted that many large European telecommunications companies were ruined financially after their regulators prematurely set the stage for 3G and hastily sold frequencies at sky-high prices through competitive bidding.

Will there be a telecom crash here?

Globe is pushing ahead with 3G. They have filed their application and announced their strategy of joining its investor SingTel (Singapore Telecom) in a regional 3G roaming and technology sharing network.

It is paying up to seal its application.

Globe said it will remit to the NTC payment of the corresponding spectrum user fees and post a performance bond equivalent to P300 million in compliance with the rules and regulations on the allocation and assignment of 3G radio frequency bands.

Will it open the 3G applications field to value added service (VAS) providers and content providers?

In its application, Globe also attached a schedule of rates for the different 3G services, which include value-added services such as MMS downloading of audio/visual file and video, video call, video conference, browsing, streaming, network gaming, video sharing, among others, as well as the basic services like voicecall, voice conferencing, and text messaging.

Smart is not following yet. According to legal head Rogelio Quevedo:

The Philippine economy is not yet ready for 3G. Our subscribers cannot afford the handsets yet. Nokia’s $100 3G handsets will not be available until next year.”

Is this because Smart’s client base is more for the “masses?” And how will Nokia bring down handset pricing to that level, when at the moment, $100 buys you an entry level MMS phone with no camera? Massive economies of scale?

For now, Smart is relying on its partnership with Research in Motion to deliver Blackberry Connect services to Nokia and Sony Ericsson users. It looks like few people have switched to the Blackberry handsets, so instead they deliver the push service to people with models more popular among its high-end business user base.

Let’s see how these new services play out. To end with Rep. Santiago:

He said the inordinately high cost of securing frequencies and the massive capital spending for 3G networks brought down the telecommunications industries of a number of European countries.

For more technology news and gadget reviews, follow us on Facebook, Twitter and Instagram