The Hindu Business Line : Philippines is `SMS capital of the world'

The Philippines has achieved the distinction of becoming the "SMS capital of the world". In 2005, Filipinos sent an average of 250 million text messages a day, according to the country's telecom regulator, the National Telecommunications Commission (NTC). At a base cost of two US cents a message, telecom companies in the Philippines earned a whopping US$5 million every day on text messaging alone.

According to a study undertaken by Ms Lorraine Carlos Salazar, Visiting Research Fellow at the Institute of Southeast Asian Studies, Singapore, and a Senior Researcher of LIRNEasia (a regional information and communication technology policy and regulation research and capacity building organisation), about 95 per cent of mobile telephone subscribers in the Philippines use their mobile phones for text messaging. Of this, 70 per cent send around 10 messages a day even as 14 per cent send between 10 and 20 messages a day.

Cost factor

The high incidence of text messaging in the Philippines has been attributed to several factors.

Text messages at a base price of two US cents per message is cheaper than calls that cost between nine and 15 US cents depending upon the plan chosen by the customer.

The NTC has attributed the upsurge in text messaging to promotional gimmicks of mobile phone service providers. The entry of a third mobile player in the market in 2004 pushed existing players to offer affordable and imaginative service packages.

Teledensity

In over a decade of liberalisation, the telecom sector in the Philippines has produced a highly competitive environment where 74 local exchange carriers, 14 inter-carrier carrier services, 11 international gateway facilities and seven cellular telephone service providers operate.

From a country with a teledensity of less than one per 100 people between 1970 and 1990, the Philippines has a fixed line teledensity of four per 100 people and a mobile phone density of 41.3 per 100 people in 2005.

Today, about 50 per cent of the revenues earned by Filipino telecom companies are from wireless data services.

"Telecom users in the Philippines use their mobile phones more for text messaging than for voice traffic. This is a model telecom companies in South-East Asia can learn from to augment their revenue generation," said Prof Rohan Samarajiva, the Colombo-based Executive Director of LIRNEasia.

More Stories on : Telecommunications | Marketing Research

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page