Telecoms firm revives dead phone lines in CDO

BY MICHAEL D. BAñOS, BusinessWorld Correspondent DC Tech, a Davao City-based telecommunications company, is helping local exchange carriers bring back lost subscribers by offering them affordable Internet services using the same landlines they use to make local calls. When cellular phone companies introduced the prepaid phone service and the P1 text message a few years ago, they unwittingly shut the door on the future growth of landline companies, known in the industry as local exchange carriers (LECs). With cheap handsets, people who previously could not afford landlines could now call or text anywhere in the country at a fraction of what it used to cost them. Hardest hit were small carriers who depended on a solid subscriber base paying monthly subscription fees and more for long- distance calls. In a flash, many subscribers of landline companies migrated to cellular phones. The latest landline statistics for Northern Mindanao provided by the National Telecommunications Commission (NTC) in Region 10 is a typical example. Of the 173,351 landlines in the region, only 73,277 or 42.3% are being used by paying subscribers. The situation in Misamis Oriental is not much better. Of the 84,111 installed capacity in the province, only 37,310 or 44.3% have been subscribed to by paying customers. In a determined bid to stop the further erosion of its subscriber base and give competitors a taste of their own medicine, Misortel, a telephone firm controlled by the provincial government, has contracted Davao’s DC Tech Micro Services to bring affordable high-speed data services to its farthest service areas. Ryan Sumalinog, DC Tech vice-president for operations, said their value-added service called Xtreme Misornet features a two-tiered service structure: its unlimited dial-up service for home use can deliver Internet services at a minimum speed of 52 kilobits per second (kbps) for only P399 a month, while its digital service line for small and medium enterprises guarantees a speed of 384 kbps for only P799 a month. These services will enable the user to access the Internet and use his voice phone at the same time. DC Tech is a full complement service provider based in Davao City, which is now into similar value-added services in partnership with Globe Telecom in this city, Iligan; Maramag, Malaybalay and Valencia cities in Bukidnon; Cotabato, Pikit, Kabakan, Matalam, Panabo, Tagum and Mati. Marriz Manuel B. Agbon, DC Tech sales and marketing partner in Northern Mindanao, said their service would provide local businessmen the impetus to invest in information technology. "With additional investments, enhanced executive reporting follows, leading to significant cost reductions, revenue growth and increased profitability as a result of improved work efficiency brought by reduced data losses and integrated systems of operations," Mr. Agbon said. Gov. Oscar Moreno is optimistic Xtreme Misornet would further push Misortel’s mission to provide modern, adequate, efficient, reliable and affordable telecommunications especially to areas currently unserved and underserved by the company. "The provision of voice and Internet applications in remote areas has become a necessity," Mr. Moreno said. "In order for us to keep up with other developing nations, our citizens must be aware and knowledgeable to successfully compete in the global market. This is where Misortel’s partnership with DC Tech plays a vital role. "The business sector, being an engine of growth, is also a priority of this venture," Mr. Moreno said. "For our economy to be globally competitive, Filipino businessmen, especially those engaged in agribusiness, must also be at par — technology-wise — with their global competitors." Mr. Sumalinog said the joint venture would also bring in new subscribers to Misortel, which has seen its former dominance in Cagayan de Oro and Misamis Oriental diminish with the inroads made on new and existing subscribers by cellular phone service providers. "Since we shall do the installation, maintenance and collection from Misortel, they would gain a steady revenue stream at little or no expense to their present network," he said. Despite being the Johnny-come-lately in the crowded Internet service market in Cagayan de Oro, DC Tech has managed to secure the second most number of subscribers after only six months of operations. Already, Mr. Sumalinog said DC Tech provides its value-added services to some 60% of the Internet cafes in Cagayan de Oro City. He said they have also successfully increased the total subscriber base of the telephone firms they are now serving by 15% after only a few months into operations. "We hope we will be able to do the same, or even better, for Misortel," Mr. Sumalinog added.