Digitel revenues down 14% to P5.6-B in 2002

After a robust 2001, the consolidated revenues of Digital Telecommunications Philippines Inc. (Digitel) slipped 14 percent to P5.6 billion last year largely due to a decrease in domestic toll traffic, the company told the Philippine Stock Exchange.

From a 35-percent growth in 2001, Digitel’s consolidated operating revenues declined in 2002 as a result of the drop in its fixed-line (or landline) revenues which it said was due to the "growing popularity of the short messa-ging service (SMS) offered by CMTS providers."

The SMS, or text messaging, has competed with the landline telephone business as sub-scribers of the CMTS (celllular mobile tele-phone system) providers find it more conven-ient and enjoyable to use this mode of commu-nication than the conventional voice calls.

Digitel launched early this year its CMTS subsidiary called Digital Mobile Philippines.

Digitel, the sixth CMTS provider in the country after Extelcom, Globe Telecom, Smart Communications, Isla Communications and Pilipino Telephone Corp. The last have tied up with Globe and Smart, respectively.

Digitel, the telecommunications arm of the Gokongwei Group’s JG Summit Holdings Inc., also attributed the decrease in its operating rev-enues in part to the company’s writedown in 2001 of additional international toll revenues arising from access charges claimed from a local carrier for terminating inward interna-tional calls to Digitel’s fixed-line subscribers.

In 2001, Digitel’s operating revenues rose 35 percent to more than P6.5 billion while its net income surged more than 1,400 percent to P67 million as the company registered growth in its fixed line subscribers, gained from cur-rency-related adjustments in service rates, and established direct circuits with major foreign carriers, enhancing its international toll revenues.

As a result of its expansion programs, Digitel is now servicing 271 towns and cities in Luzon through 674 regional and local exchanges. Its total landline subscriber base is now estimated at around 450,000 at end-2002.

Its fully-digital telecommunications facilities include a Luzon-wide "backbone" (long distance) transmission system consisting of radio stations and fiber optic cables, a transit exchange with interconnections with other operators in Metro Manila and an international gateway facility (IGF), made up of two IGF switches located in Binalonan, Pangasinan and in Quezon City, which provides instant connectivity to more than 200 international destinations.

At the retail level, Digitel provides local metered service as well as domestic and inter-national long distance services to individual subscribers both for outbound and inbound calls. At the wholesale level, other telephone companies and private enterprises utilize Digitel’s inter-exchange and IGF facilities, in effect becoming customers of the company.