Updated 08:38pm (Mla time) Nov 08, 2004
By Erwin Lemuel Oliva
INQ7.net

«IF IBM kept its mainframe business, it would be out of business now. If PLDT were to stay on its legacy business and continue offering voice as a primary service, I think we would be dead pretty soon.»

These were the words of Manuel Pangilinan, chairman of Philippine Long Distance Telephone Co., as the dominant telco tries to map out its strategy in an evolving telecommunications market.

Pangilinan was replying to a question on PLDT’s position regarding government plans to regulate voice over Internet Protocol (VoIP) services in the country.

The Philippine telecommunications industry is currently debating on government rules on whether to allow value-added service providers to enter the lucrative market for VoIP services in the Philippines.

Pangilinan stressed that government should give telephone companies time to manage the transition from its legacy business (voice-only) to more sophisticated Internet-based services, such as VoIP.

«We do have to change the
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legacy network of PLDT to IP-based and we’re in the process of doing that,» said Pangilinan.

«(But ) how can Internet service providers sell VoIP? They don’t have a (telephone) network so there should be some form of regulation,» the executive said.

He added: «VoIP is inevitable and we’re seeing it happen around the world. So we also have to change our business model for fixed-line.»

For the past months, the growth of PLDT’s fixed-line business remained flat due to lower demand for voice-only services. The fixed line business grew by only 1 percent to 35.3 billion pesos in the first nine months of 2004 versus the same period last year.

«In the next few years, we’re exploring ways to enhance DSL (digital subscriber line) to bring broadband into the market. Our legacy business will remain. But we will enhance our copper lines to DSL to address a broader base of the market,» said Napoleon Nazareno, president and chief executive officer PLDT and Smart.

Pangilinan added: «PLDT has to move to broadband that offers a richer menu of data and video applications. Our advantage right now is that we have the infrastructure. The transition from existing legacy networks to VoIP has got to be managed very well because telcos like PLDT have made significant investments in legacy systems.»

Meanwhile, an economist believes that PLDT and other telephone companies would likely get what they want, as regulators would rule in their favor.

In a paper titled «Regulation and the VoIP Challenge,» Johnson Chua, former economist of the University of Asia and the Pacific, stressed that the «outcome of the currently regulatory tussle over VoIP is likely to end with regulators citing the limits of the (Philippine) telecoms law and affirming the monopoly of telcos over the voice business.»

Telephone companies are now using existing laws to stop value-added service providers from encroaching into the «voice» business.

With the Internet becoming more pervasive and sophisticated, applications such as VoIP now allow smaller players like Internet service providers to offer voice without having to roll out expensive telephone networks.

Originally posted at 6:46 pm of Nov. 06, 2004

Cuts could come within 3 years

By Terry Camp

Mid Michigan — (11/05/04)--Michigan’s largest telephone company has announced job cuts and workers fear more. SBC Communications says it will cut as many as 1,000 state jobs within three years.

Some of those job losses will happen in Saginaw.

Terry Camp had more.

SBC blames the state’s negative business climate for the job cuts. And local workers fear it’s not going to get better soon, meaning more jobs will be lost.

Mary Palomarez is an operator with SBC. She says workers in Saginaw have feared cuts for sometime now.

«It’s hard with all the competition,» she said. «Everyone can go into long-distance service and local service. We finally got into long distance and then the cellular, that’s hurting us.»

«Here in Saginaw we’re talking 23 or 24 jobs and it won’t be until 2006,» said Billy Martin, an SBC worker and president of the local communications union.

The two dozen jobs will be lost when an office in the downtown Saginaw location is closed. No jobs will be lost at the Bay Road office.

Combined, the two sites have more than 1,000 workers. Martin says the announcement of the jobs cuts caught him off guard, but he is not surprised it’s happening.

«The fact is we need a fair business climate in the state of Michigan, but currently we don’t have that opportunity here,» he said.

Martin and SBC have complained to state regulators that the company isn’t being fairly compensated for allowing competitors to use SBC’s landlines for phone use.

Martin says SBC offices in other states have added jobs while the trend of losing jobs in Michigan could continue.

«Unfortunately I cannot predict the future, and the future could be very bleak for the rest of the people who work in this area,» he said.

A member of the Michigan Public Service Commission denies SBC claims that the state’s regulatory climate is forcing the job cuts. While only about two dozen jobs will be lost in Saginaw, several hundred will be cut in the Detroit area.

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TORONTO, /CNW/ — The total long-distance traffic processed by Telehop Communications for the month ended October 31, 2004, showed a
14.5 per cent increase over the month of September 2004, and a 7.5 per cent
increase over Telehop’s previous best month in August, 2004.

Telehop’s total long-distance traffic for the month ended October 31, 2004, was 14.32 million minutes in 1.78 million calls, versus 12.5 million minutes in 1.63 million calls in September 2004. This represents an increase of 14.5 per cent in total minutes and 9.2 per cent in the total number of calls. This traffic also represents an increase of 7.5 per cent over the previous record 13.33 million minutes carried in August 2004, Telehop’s
previous best ever month.

This increase in total number of minutes is particularly gratifying as it
indicates that Telehop has been successful in attracting higher margin retail
traffic to replace the higher risk, lower margin, wholesale traffic which it
decided to de-emphasize in the Fall of 2003, as a matter of corporate policy.

The company demonstrates continued strength in its balance sheet. Its
operations continue to be financed entirely from operations, and Telehop
currently has a strong cash position and no outstanding bank or other debt.

Ruth Bartholomeusz, chief operating officer of Telehop, stated: «Telehop
is particularly pleased with the continuing improvement in our traffic volumes
which also reflect a successful change in our business focus over the past
year. In spite of our deliberately scaling back on our wholesale business,
these traffic numbers represent the highest ever monthly volumes for the
company.»

«We are continuing to focus on controlling our cost of delivering a call,
and are working diligently to expand the breadth of our service offerings to
our customers in the other provinces in Canada.»

About Telehop Communications Inc.

Telehop is a CRTC Licensed Class «A» Telecom Carrier, and one of the
largest alternative telecom providers to the residential & business market.
Telehop offers origination and termination services to other carriers
worldwide, including switchless resellers, and provides ’Equal Access’ Long
Distance and the branded «10–10–620» — ’Dial Around’ Service. It also provides
Flat Rate ’Hop’ calling in Southern Ontario and in the Metropolitan Montreal
area covering a population of approximately 8 million people, and provides
1–800 toll free numbers and Virtual Calling Cards, allowing calls from any
phone in North America to anywhere in the world. Telehop also offers the
branded «Broadtalk™» VOIP flat rate service to residential and small
business customers.

Shares Outstanding;- 12,437,000
Fully Diluted;- 13,521,500

More investor information on Telehop (HOP-TSX Venture) may be obtained at
[ >>> ]
sign)EN&issuerNo=00004365 or by calling Patrick V. Farrell at
(416) 494 4490 ext 399, or 1–866–530 7988 or e-mail pfarrell@telehop.com
%SEDAR: 00004365E