Gokongwei-owned Digitel Telecommunications Philippines, Inc. is setting aside $393 million (P16 billion) capital expenditures this year for the expansion of its wireless brand Sun Cellular network.

Digitel said it expects to double its wireless unit Digitel Mobile Philippines Inc.’s cell site base by the end of this year to support the projected surge of subscribers.

"The company will expand coverage from current 2,200 cell sites to about 4,000 by end of year 2008," Digitel said in a statement.

The capex this year is much higher compared to previous years when the company allocated between $200 million to $300 million. Sun Cellular invests P11 billion every year for additional network infrastructure.

Based on DMPI’s three-year roll-out plan, it targets to increase the coverage of its cellular phone units from 87.8 percent of the cities and provinces in end-2007 to 91.1 percent by middle of this year.

Currently, Sun Cellular is aggressively expanding its coverage in Bulacan, Cavite, Laguna, Pampanga, Batangas, Nueva Ecija, Cebu, Bacolod, Iloilo, Davao, Cagayan de Oro, Zamboanga, General Santos, among others.

Last year, Digitel posted consolidated revenues of P16.8 billion, up by 48.3 from the previous year’s P11.3 billion.

Consolidated service revenues amounted to P8.3 billion, better by P665.6 million or 8.8 percent from a year earlier owing to higher service revenues generated by the wireless business.

The revenues came particularly from Sun Cellular’s service connection fees and local monthly service charges and from charges generated by telephone calls that vary based on the distance, duration and time of day of the call.

Revenues were also generated from the sale of phone kits and from charges for short messaging service and other value added services (VAS) aside from the traditional wireline voice and data services.

The wireless business reported P3.9 billion service revenues in 2007, a 41-percent rise from P2.8 billion in 2006. The increase was attributable to the continued growth in subscriber base that boosted revenues in unlimited fees, voice, SMS, roaming and value-added services.

As of end-December last year, Digitel’s cellular subscribers’ base stood at over 5.5 million, up by nearly three times the two million in 2006.