Network investments boost Smart data traffic, revenues

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Cebu City fish seller Nhylon Abella was one of the many Filipinos whose livelihood was disrupted by the COVID-19 pandemic. To keep her business afloat, Abella did what many people have had to do when life was put under lockdown — go online.

Today, she does business via her mobile phone: advertising her fish stocks on social media, talking with her customers via chat apps, and booking riders for door-to-door delivery.

For Abella and many other customers of PLDT wireless subsidiary Smart Communications, Inc. (Smart), going online via their mobile phones has been virtually seamless – thanks to the sustained network investments undertaken by PLDT and Smart, particularly in the last three years.

“Our LTE-powered mobile data network has passed the initial COVID stress test. The money and effort we’ve invested in our network have enabled us to provide quality service to our mobile phone customers even as data usage continued to rise, particularly since people have been forced to stay at home by the pandemic,” said Alfred S. Panlilio, Smart President and CEO, and, PLDT Chief Revenue Officer.

In the first three months of 2020, Smart’s mobile data traffic grew to 636 petabytes (PB) —double the traffic from the same period last year, and a 26-percent increase from end-2019. This pickup in data traffic was largely due to the sustained upswing of data usage since 2018 as Smart customers turned increasingly to using mobile video and social media apps.

As a result, Smart’s service revenues grew 20 percent to P20.2 billion, staying firmly on the growth track from the previous year. The share of data revenues to total wireless consumer revenues rose to 72%, from 65% in the same period last year, and 44% in 2018.

Continued network roll-out

Underpinning the growth of mobile data traffic and revenues has been the continuous expansion and upgrade of PLDT and Smart’s fixed and wireless network. As of end-March, Smart increased the number of 4G/LTE base stations to 26,000, up 6% from end-2019 and 60% more than end-2018. PLDT’s fiber infrastructure, which supports Smart’s network by providing high-capacity links to LTE base stations, is now at 338,500 kilometers nationwide, 5% more than end-2019 and up nearly 40% from end-2018.

In April, Smart further increased the capacity of its LTE network by reallocating its assigned 1800 Mhz frequency from 2G to 4G/LTE. As a result, 3,785 2G base stations of Smart were converted into LTE base stations, providing additional capacity for its LTE network.

The growth of network capacity has been accompanied by the continuing shift of Smart customers to smartphones. By the first quarter of 2020, about 71% of its customers owned data-capable handsets.

Quick adjustments to COVID

The data usage and usage and revenue numbers of Q1 2020 do not yet fully capture the “COVID effect” since the Enhanced Community Quarantine (ECQ) was imposed on Luzon only in the second-half of March 2020.

Initially, the ECQ had a dampening impact on Smart’s revenues because restrictions on people’s movements made it difficult for Smart sales personnel to support its network of retailers. But, quick adjustments – including the increased use of the Smart Ka-Partner mobile app to distribute prepaid load to retailers – enabled sales to regain momentum.

Meantime, Smart levelled up its data offers by doubling the data allocation for its postpaid subscribers and beefing up the data packages of its prepaid customers. This move met head-on the surge in demand for data connectivity and digital services. Forced to work or study from home, mobile phone users stepped up their usage not only of video and social media, but also of a broad range of other digital services such as video conferencing, online shopping, digital payments and, lately, online medical consultations.

Responding to the new needs of its customers, Smart launched in April its GIGA Work bundle, which features work collaboration apps and productivity tools such as MS Teams, Google Meet and CISCO WebEx for videoconferencing, MS Office 365 and GSuite for work collaboration, and PayMaya, Lazada, Shopee, and Grab for delivery and payments.

“Our goal is to provide solutions that will enable them to pursue their daily lives productively and safely during and after this time of COVID and as everyone adopts to the emerging New Normal,” said Jane J. Basas, Senior Vice President and Head of the Wireless Consumer Business.

Meanwhile, Smart together with parent firm PLDT stepped up the use of its data services to help frontline agencies fighting the pandemic. To assist health authorities in contact tracing, for example, Smart provided free mobile data access to StaySafe.ph, an online application that gathers health information from its users.

Smart provided 540 smartphones with data load to enable the government to use in the entire Metro Manila area an online application called RapidPass.Ph that allows health workers to go through quarantine checkpoints quickly. Smart also supplied 40 mobile phones to the Philippine General Hospital to enable the hospital staff to handle COVID patients while reducing their exposure to the risk of infection.


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