Smartphones erode landline market

That fewer people are making calls on fixed line phones should come as no surprise. But the rise of data-enabled mobile phones, which allow consumers to make calls or access the internet, is changing consumer behavior and the very way we communicate, officials of the Philippine Long Distance Telephone (PLDT) Company said Tuesday. “With the onset of new technology and the way young folks have changed the way to communicate, the traditional way of communicating, which is voice [both] long distance national and international, has changed,” PLDT chairman Manuel V. Pangilinan said in a press briefing in Makati City. “The trend towards the decline in volume is there. It’s a simple fact we have to accept as there’s a new mode of communicating,” he added. The decline is due to “the changing consumer behavior, the evolution of data as a growing segment of the market, the reduction in inbound international traffic and the appreciating peso,” PLDT president and CEO Napoleon Nazareno said. “More people are calling the cellular phone rather than the home phone. The other is the presence of over-the-top player, [where] one can use the over-the-top services IP to IP calling from abroad to here. And as the broadband terminals increase in the country, that would more or less negatively impact the international inbound,” he said. “In peso terms, it is going down because the peso is strengthening. In US dollars, the impact is much less,” Nazareno added. In the first quarter of the year, PLDT posted consolidated revenues of P40.96 billion, slightly higher than P40.83 billion in the comparable period in 2012. Nazareno said PLDT's revenues can be classified into: - the growing revenue base: non-SMS data revenues, which represent about 20 percent of total revenues and which rose 10 percent to P8.2 billion in the period from P7.5 billion in the first quarter of 2012; - the steady revenue base: SMS, cellular domestic voice, and local exchange carrier (LEC) revenues, which cornered about 60 percent of total service revenues and which stood at P24.2 billion during the period; and - the declining revenue base: national long distance, international long distance and cellular international voice revenues representing 17 percent of total revenues, which dropped by 9 percent to P6.6 billion from P7.3 billion in the comparable quarter in 2012. PLDT expects the long distance and international voice revenues to further dip due to the lower peso-to-dollar foreign exchange rate. — BM, GMA News