Smart captures 2 major int’l awards

Smart Communications, Inc., whose subscriber base could reach 18 million by end-2004, captured two major innovation awards in the inaugural Frost & Sullivan Asia Pacific Technology Awards held in Singapore Thursday night.

Smart was cited as the Asia Pacific Wireless Service Provider of the Year, and its world-first over-the-air electronic prepaid loading service called Smart Load was adjudged the Most Innovative Application.

A wholly-owned subsidiary of the Philippine Long Distance Telephone Co. (PLDT), Smart was the only Philippine telecommunications firm among the awardees, and the only company to cop two accolades.

"These awards are testimony to the untiring efforts of your team and to Smart’s strong performance in 2003. The specific criteria that were used in the judging process include, among others, market share growth, revenue growth, product/service innovation and demonstrated contribution to the ICT (Information and Communication Technologies) industry," Frost & Sullivan partner Manoj Menon said in a letter to Smart president and chief executive officer Napoleon Nazareno. Frost & Sullivan is a leading growth consulting firm based in Singapore.

For his part, Nazareno, concurrently PLDT president and CEO said: "Our growth has been powered by our relentless efforts to broaden the market for mobile phone services. We’re happy to note that this strategy has not only helped to build our business and enhance our bottom line. We’ve also spread the benefits of growth by creating for example micro-businesses for the over 400,000 retailers selling the Smart Load service." Frost & Sullivan gave a total of 24 awards under three groups to vendors, service providers and other industry players in the Asia Pacific region.

The winners were chosen based on a strict selection process, according to the consulting firm. An analyst team created by the Frost & Sullivan was responsible for short-listing three to four companies in each category. The team then conducted a detailed research on the companies’ market performance. An international panel of judges deliberated on the findings, and picked out the winners.

Smart, together with affiliate Pilipino Telephone Corp. (Piltel), sustained its industry leadership in 2003 with a combined subscriber base of 13 million. As of end-March, their combined subscriber base reached 14.4 million, equivalent to about 58 percent market share. The number of subscriber net additions was over 1.4 million, a record high.

Cellular penetration rate in the Philippines, which has a population of about 80 million, was estimated at about 30 percent as of end-March. A few years ago, expectations were the Philippine penetration rate would peak at 25 percent.

Smart has played a significant role in expanding the market for cellular phones through a series of marketing and technology innovations since its birth in 1994.

Its latest major innovation, Smart Load, enables Smart prepaid users to reload their phones via text messaging in denominations as low as P30. By offering micro top-ups, the electronic loading service has made mobile phone services more accessible to low-income customers, in much the same way that selling soaps, detergents and shampoos in sachet packs vastly expanded the market for these products in developing countries.

Smart Load is sold by over 400,000 retailers – shop keepers, housewives, students and office employees – who use their Smart cellular phones to transfer loads over-the-air.

Currently, over 85 percent of Smart prepaid subscribers top up electronically via Smart Load while an even higher 94 percent of Piltel’s Talk ‘N Text subscribers do the same.

Propelled by the strong growth in subscriber base and widespread use of Smart Load, Smart’s net income in 2003 almost tripled to P16.1 billion from P6.2 billion in 2002.

During the first quarter of the year, Smart’s net income stood at P5.15 billion, up 86 percent from P2.77 billion in the same period last year. The company’s robust growth helped boost the PLDT Group’s net income level, which rose 111 percent to P5.24 billion in the first quarter, from P2.48 billion last year.

Smart Load has started a trend among wireless operators internationally. Other mobile operators in the region are said to be preparing to follow suit.

In February 2004, Smart Load was also cited as the Best Mobile Application or Service in the Consumer Market at the ‘Oscars’ of the industry, GSM Awards, in Cannes, France.