MANILA, January 11, 2005 (STAR) TXT IN D CITY By Patrick R. Garcia (BIDSHOT WIRELESS SERVICES) Despite lots of brain cells fried and liver damage brought about by my last holiday’s many festivities which still have left me feeling lethargic, I gallantly accepted my editor’s text message reminding me of my article’s deadline. In fact, this is one of my favorite times of the year to be writing because I want to do my fair share and contribute to the season’s most common topic, "My predictions or top..." In the spirit of the New Year, I will provide my top five 2005 predictions. Why five? Because I will start with a recap of my last year’s predictions and may just run out of print space.

I did a quick review of my last year’s predictions and got eight out of 10 correct. Here are the eight I got right: the camera phone would sell below P10,000; further convergence of e-mail and mobile phone would occur; mobile PDA devices would remain a niche; the peso would go over-the-air; TXT TV gaming; Wi-Fi would show stronger take-up; content would continue to rule for most users; and SMS would still dominate. What I missed (probably so because they were both controversial in nature): mobile number portability would be imposed, and TXT gambling would finally be launched. Oh well, not a bad batting average, I would say. Okay, here are my top five 2005 predictions:

1. Mobile number portability will be imposed. I will again place this prediction on my list this year since I believe telecoms regulation by the NTC will even be tighter. Such a regulation will also be a political move to appease pro-consumer advocates and the present 40 million Filipino subscribers. Importantly, the resulting increased competition among the carriers to retain their subscribers should be good to lower both personal and enterprise communication costs as well as improve quality of service.

2. Voice-centric value-added-services (VAS) will catch on. SMS VAS will still remain a dominant contributor to telcos’ VAS revenues, but growth will start to level off this year as our market matures. With our current 40 percent mobile penetration rate, any newly acquired subscriber will be coming from the Class C and D segment who, in turn, will provide a lower revenue per user and a high churn rate. Voice-centric services are an alternative to our current SMS VAS services but now offered in a voice format. Imagine receiving your daily horoscope via a pre-recorded voice call instead of SMS. Their novelty should take off if they are priced and marketed strategically.

3. Mobile wallet usage will accelerate. The last quarter of 2004 saw the debut of Globe’s G-cash platform which allowed the secure transfer of cash by just texting. This is a much-awaited innovation which I believe is a key driver for m-commerce in the Philippines. A stable of high-profile merchants have already signed up and many more have clogged Globe’s m-commerce department for accreditation. This year, I foresee numerous subscribers adopting this solution as a means to make micro-payments and remit currency peer to peer.

4. More SMS converged websites will be launched. The cost of DSL or dial-up connections is quickly coming down as seen in numerous promotional advertisements of PLDT in the last few days. As such, various SMS or multimedia VAS products which were once limited to the mobile phone will now be made available for subscription or setting via a parallel website which should offer a richer user experience.

5. Low-end mobile phones will provide more entertainment options. The mobile phone has now evolved into a multi-function gadget. Technology has become cheaper, even lower-end phones now carry VGA cameras, video recorders, xHTML browsers and such features, which were once only available in P25,000 high-end phone models. The most ideal mass market scenario is for a user to carry one gadget that provides him communications and his choice of entertainment. As such, I foresee mass market mobile phones (sub-P10k) to be launched with either a mix of options like 1.3-megapixel camera, MP3 player, wireless multi-play gaming via GPRS or Bluetooth, and RealOne video player, just to name a few.

All things considered, 2005 will still shape up to be an exciting year where all telcos and their content providers will continuously be challenged by the mature wireless Filipino. A Happy New Year to all!

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Patrick R. Garcia is the managing director of Bidshot Wireless Services. For comments or suggestions, type TXTCITY <message> and send to 2920 or e-mail txtcity@yahoo.com.

Reported by: Sol Jose Vanzi

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