Digitel interconnects with Globe, Smart

The country’s two largest mobile phone service providers have entered into separate agreements with the newest entrant in the Market-Digital Telecommunications Phils. Inc. (Digitel) – to allow text messaging between their respective subscribers.

Smart Communications Inc. signed yesterday an agreement with Digitel to interconnect their respective cellular mobile telephone system (CMTS) networks completely by allowing text messaging or short messaging service (SMS) between Smart and Digitel cellular phone subscribers.

A few days earlier, Globe Telecom also signed an interconnection agreement covering SMS with Digitel.

Both Smart and Globe have already signed separate interconnection agreements with Digitel covering voice calls.

The signing of the SMS interconnection agreement between Digitel and Smart came a few days after Digitel commenced commercial operations of its GSM (global system for mobile communications) service known as Sun Cellular.

Digitel president and chief executive officer Lance Gokongwei told The STAR that commercial operations of the country’s newest mobile phone service provider began last Saturday.

Digitel was expected to begin commercial operations during the first week of April but as it turned out, the company was able to push through with it ahead of schedule.

The company is targeting only one million subscribers in its first few years of operations, which is even less than the expected growth in total cellular subscribers in the country each year.

Digitel’s foray into the highly competitive GSM service business is expected to cost P8.17 billion.

Gokongwei earlier revealed that they are set to award sometime in May this year the contract to implement the next phase of their CMTS project. The choice has been narrowed down to two: Alcatel or Ericsson.

Right now, Digitel is awaiting approval from the National Telecommunications Commission (NTC) for the transfer of its CMTS assets and license to operate to a new subsidiary, Digitel Mobile.

Globe senior vice president Gil Genio said both Globe and Smart had agreed upon an access charge of P0.35. This means that for every text message sent by Globe to Sun Cellular, or vice versa, the send will pay P0.35 to the receiving party.

Meanwhile, Smart legal head Rogelio Quevedo said that interconnection with another carrier will always result to more revenues for both firms. "Again, this interconnection is another milestone for the telecommunications industry. With interconnection there will be more subscribers which will result to more revenues for both interconnecting parties," he said during the signing yesterday.

Sun Cellular is expecting to rake in about P4 billion in revenues at the end of this year, contributing 40 percent to Digitel’s revenue mix.