Greed manifests

We were one with the two most established telecommunications company, Globe and Smart, when they cried predator pricing against Sun Cellular’s unlimited call and unlimited text promo about two years ago.

We argued then that in the long run Sun’s unlimited promo may not work to the benefit of the entire telecommunications industry. We likened Sun’s promo to a public utility vehicle (PUV) that dived down from the fare set by government regulatory bodies so it can corner the most number of passengers. The strategy would not work in the long run, we said then, because Sun Cellular will surely not be able to sustain its operations since it would not be able to maintain in tip top condition its telecommunications infrastructure.

So we joined the other two telecommunications players in expressing fear that Sun may just be using its unlimited promo to attract in the fastest possible time the most number of subscribers for better leverage with prospective buyers should the firm decide to sell. Sun is still very much around with no signs of wanting to have a change in its majority owners.

But we were flabbergasted to read in the papers yesterday the revival of the previous lament expressed by the two telecommunications firms against Sun’s unlimited promo because it is causing their profits to dwindle. What actually dismayed us was Smart and Globe’s reasoning that they are having a hard time coping with the infrastructural demands for a heavier text and call traffic since they, too, had to engage in promotional offers such as the one pioneered by Sun.

Smart, through its parent company, Philippine Long Distance Telephone Co., then said that its first semester profit for the current year was up by one percent only compared to same period of last year. And did you know how much profit they earned that saddened them? A whooping P10 billion! But this did not satisfy them. Globe’s profit for the same period is P5 billion but like Smart, the company is also not satisfied which is why they are venting their ire on Sun’s unlimited promo as the culprit for the dip in their profits.

This development, the two firms subtly warned, may affect their ability to serve their respective clientele efficiently for they now have a problem keeping up with expectations. This is a possibility insinuated by the two firms because their income may not be able to sustain their infrastructure development to meet the volume of calls and text messages that they now handle as a consequence of the unlimited promos they were forced to adopt also. The love for profit is indeed insatiable.

Interesting question

As an airline company, Philippine Airlines (PAL) is engaged in the business of transporting goods and passengers to destinations here and abroad. In carrying this out, PAL engages the services of qualified licensed pilots to perform a job that is necessary in the course of its business. Precisely because its business requires the services of these pilots that it was disrupted last week as a result of the resignation by some 25 pilots and first officers.

PAL is now left with no choice but hale to court the resigned pilots for breach of contract. But we are surprised why these pilots are only contractual employees when they are performing jobs that are necessary in the course of the company’s business? But since the two parties voluntarily and willingly entered into such contractual agreement, it is presumed both parties are amenable to it and are expected to honor each other’s obligation as stipulated in the contract. This practice of contracting the pilots’ services is perhaps worth looking into if a long lasting peace between the two parties is desired. –Jesse E.L. Bacon II, Daily Tribune

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