America at the forefront of a lesser war

( Second of a Series )

In all the 18 years I was in government, specifically with the Department of Transportation and Communications (DOTC), and especially when we demonopolized and liberalized the telecom environment, interconnection arrangements and the financial charges attendant thereto, as provided by law, were treated as bilateral commercial matters for the telcos to negotiate upon and reach an agreement on, within the parameters laid down by law and the regulations pursuant thereto. As regards their dealings on this matter with foreign carriers, the same was true. The NTC, in effect, as in the past, with the local telcos, and now in this unfortunate situation with the American telcos, which I call a "lesser American war," has very rightly in keeping with international practice, commercial arrangements, and national laws, stated that "termination rates are private commercial arrangements entered into by carriers of their own free will, pursuant to the constitutional guarantee of freedom to contract."

In a letter dated 26 February, 2003, addressed to the FCC commissioners in Washington D.C., signed by two ladies that I have known and worked with for a good long time in the past, and respect very highly, NTC chairman Armi Jane R. Borje, and deputy commissioner Kathleen G. Heceta, the NTC position was very clearly emphasized that the Philippine telcos’ proposed rate increases as above specified, are still well below the US$0.19 charge per minute FCC benchmark, and the International Telecommunications Union’s (ITU), the UN specialized agency regulating world telecommunications, suggested rate of US$0.238 applicable to countries such as the Philippines, and are therefore "fair and reasonable." As of the 26th of February, more than 90 foreign telcos had already agreed to the new termination rates. Other significant telcos of the United Kingdom, Japan, Singapore, New Zealand, Malaysia, Brunei, Indonesia, Australia, Spain, Switzerland, Denmark, Germany, the United Arab Emirates, Norway, Portugal, Qatar, Guam, Israel, and I understand, even Hong Kong who initially had a problem with it, have agreed to the new termination rates. And in the US, more than 10 at least, have signified their consent and Canada’s two carriers likewise.

How can AT&T and MCI WorldCom SQUAWK before their very own regulatory body, the FCC, and allege "whipsawing" and "disruption of service" which have been vehemently denied by our very own telcos, without even bothering about going to the negotiating table like gentlemen of honor, and deal with the matter with the utmost urgency and fairness, and thereby arrive at a bilateral agreement. Let me emphasize that the Philippine termination rates petitioned for are in accord with the benchmarks of the US and ITU, and as shown above, have been accepted by most foreign operating administrations the world over.

Atty. Rodolfo Salalima, one of the best telecom lawyers in the country, with tremendous experience locally and in the ITU told me personally that AT&T had been withholding payments on as much as US$13.5 million in debts to Globe Telecom pressuring the firm to give in to the demand for lower termination rates. US$3.5 million was supposed to have been paid by AT&T to Globe Telecom last December, but not a cent has been paid today. This, by the way, is an act of a hoodlum-entity, and I think I have come across the first "Ugly American" in a long while whose ugly chicanery is spelled out in this manner: "I owe you money, you will not get paid unless you say ‘Amen’ to me." Hey, this indeed is a hold-up! Here I can smell an Ugly American loud and clear.

Another horror dimension emanates from another Philippine carrier, one of the five earlier mentioned, Smart Communications Inc. One clever lawyer, the head of legal and carrier relations of Smart COM, Atty. Roger Quevedo states that the key issue in the dispute is not so much the increase in termination rates but rather the severe imbalance in revenue sharing between the US and Philippine carriers. "The current revenue sharing," Quevedo cites, "is more than three times in favor of foreign carriers, particularly US carriers like AT&T. In 2001, AT&T raked in US$ 186.6 million in net revenues from US calls bound for the Philippines while its settlement payments to Philippine carriers amounted to only US$ 52.4 million." These statistics had been drawn from the 2001 Report under Section 43.61 or the International Traffic Data of the US Federal Communications Commission. What should be very critically considered is the fact that even after the specified increase urgently petitioned for by our telcos, revenue sharing will still be greatly and indeed absurdly in favor of international carriers.

No wonder Governor Jerry Brown not too long ago did say, "This is still a very wealthy country. The failure very sadly however is of the spirit and insight." In the face of an imminent war avowed to be brought upon Iraq by the US, in all likelihood and for all intents and purposes, with or without an official declaration of support by the United Nations, the words of a successful investment banker, Archibald Cox, in a speech delivered about four years ago, before 9/11 and the Iraqi undertones, now rings ever so clearly in my mind...Archie’s words were strong about his own country: "I confess that I cannot understand how one can plot, lie, cheat, and commit murder abroad and remain humane, honorable, trustworthy and trusted at home." (to be continued)