Government wants 3rd telco operational by next year

MANILA, Philippines — The government wants the third telco player to break the duopoly and start operations by the middle of next year, the Department of Information and Communications Technology (DICT) said.

“The third telco must be operational by middle part of 2018,” DICT officer-in-charge Eliseo Rio Jr. said in a text message yesterday.

Following the announcement by Presidential Communications Operations Office Secretary Martin Andanar that China Telecom has been identified to be the third telco player in the country, Rio said the government would still have to choose the local firm the Chinese telco would be partnering with to be able to start operations.

“China Telecom was selected by China Government as their telco to invest in the Philippines as per invitation by President Duterte. We still have to select the Philippine telco or consortium to partner with China Telecom,” he said.

This, as the Constitution limits foreign ownership of a telco firm to 40 percent.

Rio said there are many local stakeholders that have expressed interest to partner and be the third telco player in the country.

 “I would say around a dozen have already expressed interest,” Rio said but declined to name them.

“We have to be careful in our selection process so that it must be very transparent and open,” he said.

He said earlier, the DICT would identify the possible third or even a fourth telco player before the end of the year.

The DICT would also make frequencies available to allow them to compete with existing telco players PLDT Inc. and Globe Telecom Inc.

During the bilateral meeting held with Chinese Premier Li Keqiang last month, Duterte asked China to invest in the telecommunications industry and be the third player in the Philippines.

The offer was made amid complaints of consumers of dropped calls and slow internet speeds.

Meanwhile, the National Transmission Corp. (TransCo) is ready to be part of the new telco player as it owns the largest fiber optics network which can be used to speed up internet service in the country.

TransCo president Melvin Matibag said in an interview yesterday that the agency has submitted to the Department of Energy (DOE) its telco framework.

He said TransCo could be the local partner of the Chinese firm that would enter the country’s telecommunication industry.

“We want to push TransCo be part of the whatever project it is because considering the owner of the facility is TransCo so this is also in support of the pronouncement of the President to encourage a third telco player,” Matibag said.

“We can be the 60 percent. The 40 percent is the technical and financial capacity,” he said.

Over the weekend, Presidential Communications Operations Office (PCOO) Secretary Martin Andanar identified China Telecom Corp. Ltd. as the Chinese firm that would invest in the Philippine telco industry.

Being the largest telecommunications company in China, Matibag said they have the technical expertise in operating telecommunication services while TransCo can offer its facilities – its fiber optics network.

“What we can offer is the facilities, which may shorten the process,” he said.

“The way we project it, for Luzon, we can do it in six months and for the entire country, around one year. This is from the time agreements will be forged,” the TransCo chief said.

TransCo owns the national power grid, which has about 5,000 to 10,000 fiber optic cables of existing fiber optic facilities that run from Luzon to Mindanao for internal communication purposes.

The transmission network is operated by the National Grid Corp. of the Philippines through a 25-year concession contract. -With Danessa Rivera