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PLDT acquires 50% of SMC telco business, eyes service improvements with the 700Mhz band

Big news struck the Philippine telco industry yesterday as PLDT-Smart announced the acquisition of San Miguel Corporation’s 50% telco business. The other 50% acquired by Globe is evenly split 50/50 in terms of any assets relating to the purchase. As PLDT is purchasing the business and not just the hardware, the acquisition will also come with the hardware (cell towers), licences and frequencies approved for use by SMC before. As such, the highly in demand 700mhz is included.
PLDT acquires 50% of SMC Telco business, eyes service improvements with the 700Mhz band

Why is the 700mhz frequency important?

The acquisition comes not just with the hardware but also the government approved frequencies. The 700mhz was a highly in demand frequency as this will be vital for the improvement of indoor coverage and rural / regional rollout. Other than that, this added frequency will enhance the existing 900mhz and 1800mhz coverage. In layman’s term, because of this additional frequency, we as consumers should feel a definite improvement in terms of service, like better reception, clearer lines, faster mobile data and such.

Although not immediate, according to Ramon Ang, this is the fastest way to improve the current telco situation skipping legal battles and gazillions of discussions with other players. For Smart and Globe, both will be equally receiving whatever was acquired from SMC. Currently, the only running and working business from that group is Eastern Telecommunications as it is already an operating company. The other group, Vega group, houses Belltel and WiTribe among others.

As a trivia, before the deal was done, only the Philippines and Thailand are the 2 countries in the Asean region not utilizing the 700mhz frequency.

What else is there “tech related” to know about this deal?

For one, according to MVP himself, the caveat to the new 700mhz frequency is that devices that can receive signal from that are limited at the moment. Another important thing a lot of people are interested to know is, “will there still be space for a third player?” The answer is a big yes! With this acquisition, both Smart and Globe voluntarily returned to the government frequencies as mandated by law. But contrary to what most might think, these returned frequencies are not useless but also important and vital frequencies according to PLDT executives.

How long before we feel the improvement?

According to PLDT executives, it is not like as soon as you acquire the hardware and licences, the service will immediately be better. It will of course take a bit of time in terms of integrating existing and when MVP was asked how long before we feel an improvement, he was hesitant at first but in the end, he said around 6 months, before we feel an improvement.

The marriage between the two telco giants is a huge news and together, they will initially jointly manage what they have acquired until a time where they can split and partition what they have purchased. It’s a win-win situation for them as Smart and Globe gets additional hardware and frequencies and in return, consumers will get improved services.

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