The launch of the pre paid service in telecommunications industry
is revolutionary. It expanded the market base to non document holders,
opening ownership to all ages and market type. Rigorous validation procedures
and time consuming credit investigation are no longer necessary because
pre paid service has successfully eradicated the risk of churn. It
is therefore easier and faster to avail . In addition, the subscribers
are allowed greater flexibility of use, greater control over their expenses
and are free from billing problems.
Pre paid service also revolutionized distribution. The
trend being pre paid and pre activated, celfones are now shrink wrapped
to suit off the rack sales. They come in attractive packages,
complete with product guides and comprehensive service manual to aid the
buyer. Unlike before when customers are expected to return to the
outlet to submit documents and follow up on approval and activation, sales
procedures have been simplified to payment and quality check of the units
released.
As pre paid cellular service graduates into a consumer item classification
, Comworks sees a growing opportunity for non traditional retailers
and distributors to join the telecommunications business. The key
is distribution and its success lies heavily on accessibility and availability
.
The popularity and preference for pre paid services spells BIG
BUSINESS . Pre paid represents an average of 70% share
in total monthly celfone sales As of August 1998,
the total subscribers base for pre paid service is estimated at 460,000
(75% of which are Manila subscribers). This figure continues to grow
as pre paid airtime rates are becoming more competitive and carriers continue
to push this type of service over regular lines.
The distributor has the opportunity to earn not only from the handset
units sold but earns a steady stream of income from the repeat
purchases of pre paid airtime cards.