Network unplugs mobile business next month

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  • ABS-CBN Corp. yesterday said it will officially end the operation of its mobile business by November this year for failing to achieve profitability after five years.

    ABS-CBNmobile prepaid, postpaid and SkyMobi subscribers will continue to enjoy text, call and data services until November 30.

    ABS-CBN unit ABS-CBN Convergence and Ayala-led Globe Telecom have agreed not to renew their five-year mobile network sharing contract which expired in June this year.

    “After a thorough assessment, ABS-CBN Convergence deemed its current mobile business model to be financially unsustainable. As a result, ABS-CBN Convergence and Globe have reached an agreement not to renew their mobile network sharing contract,” ABS-CBN said in a filing at the Philippine Stock Exchange.

    ABS-CBN partnered with Globe to deliver mobile services nationwide using Globe’s infrastructure. ABS-CBN is paying the telco on a wholesale rate for the use of its servers, towers and switches.

    ABS-CBN has invested P3 billion as working capital in the first three years of operation of its mobile venture for back room support, billing system and customer services.

    The company aimed to have at least 2 million mobile subscribers to break even, but it only had 930,000 subscribers by end-2016 and almost the same in 2017, before dropping further this year due to competition.

    ABS-CBN’s digital and interactive media segment – composed of online, mobile and over-the-top business – reported a net loss of P441 million in 2017, lower than its net loss of P634 million in 2016.

    Despite the contract termination, ABS-CBN and Globe are exploring new ways and synergies that complement their business models.

    The two companies continue to bank on their competencies and focus on new synergies to serve their customers better, such as the promotional bundling of ABS-CBN TVplus boxes with Globe At Home prepaid WiFi and making ABS-CBN TVplus’ KBO (Kapamilya Box Office) and iWantv over-the- top services available to all Globe subscribers.

    ABS-CBN Convergence thanked its loyal subscribers and vowed to provide updates on their plans and subscriptions.

    It also said all ABS-CBNmobile and SKYmobi promo offers will no longer be offered to subscribers effective October 25, 2018.

    ABS-CBN Convergence, formerly Multi-Media Telephony Inc., has a congressional franchise to operate mobile and broadband services nationwide that is set to expire by 2020. (Malaya)

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