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Business

NTC hands off slow Internet

- Boo Chanco - The Philippine Star

Internet access is a value-added service (VAS) under R.A. No. 7925, NTC Chairman Gamaliel Cordova wrote me, which makes the price and speed subject to agreement between the provider and the user (and to market forces also). I e-mailed Cordova to get his comment on a graph widely circulated in the Internet that placed us dead last among ASEAN countries on Internet speed.

For those who have not seen that graph, here is the information that made netizens shake their heads in disgust pretty much the way Filipino travelers feel anger about NAIA terminals. Here is what ASEAN DNA found out by way of comparative available Internet speeds:

Philippines is 3.6 mbps, or pathetically below the average ASEAN speed of 12.4 mbps. Laos four mbps; Indonesia 4.1 mbps; Myanmar 4.9 mbps; Brunei 4.9 mbps; Malaysia 5.5 mbps; Cambodia 5.7 mbps; Vietnam 13.1 mbps; China 18.3 mbps; Thailand 17.7 mbps.

Another chart, this time claimed to have been based on NTC figures show how much our Internet providers are overcharging us based on monthly rates: Philippines 3 mbps at P1,000; Singapore 15 mbps P1,312 and Thailand – 12 mbps P1,100.

NTC chairman Cordova seems to have a good excuse for washing his hands. He says our law is outmoded and we need to give NTC more teeth.

“R.A. No. 7925 was issued in 1995 when the Internet was still an emerging and expensive technology. This is the reason why NTC wants this law reviewed and amended to make it more applicable to the present situation.” 

Cordova also thinks that ASEAN graph doesn’t accurately describe the current state of regional Internet speeds. “The Philippines ranked No. 1 in voice BPO, an industry which uses VOIP which, in turn, requires high speeds and bandwidth to meet the expectations of its international clients. 

“Penetration rates are also important indicators, e.g. Myanmar has only one million people with internet access out of a total population of 65 million, while the Philippines has 45 percent of its almost 100 million population with internet access.”

Furthermore, Cordova pointed out to me that he checked the Myanmar data and found out the survey was only based on Yangon. Myanmar only has 400,000 Internet users, mostly just from Yangon and Mandalay.

It is the same thing with Laos, he said, with the survey data only from Vientiane. As for Cambodia, Cordova said it only has a little over a million mobile broadband subscribers and 30,000 fixed broadband users. In Vietnam, he pointed out, government owns the telecom infrastructure. In Malaysia, data only came from one island.

“The type of a country’s land formation also plays a role, i.e. the Philippines and Indonesia are both archipelagos while the other countries like Singapore, Thailand, Myanmar, Laos and Brunei are predominantly contiguous land masses.  A combination of these factors will provide practical ‘apple-to-apple’ comparisons.”

Maybe, Cordova makes good points. But I think if we go into the innards of the issue, we will still find out how the ordinary Philippine broadband subscriber could be better served.

I get the point about our predominance in voice BPO that utilizes VOIP and that cannot happen unless there is impeccable internet connection, notably speed. Cordova insists “the presence of some of the biggest names in the BPO in the Philippines proves that our broadband infrastructure is capable of supporting their broadband requirements which would range from 20-45 Mbps for voice and as high as STM-1 155 Mbps for non voice.” 

What Cordova is saying may be correct, but I suspect the telcos put their best effort to keep BPO accounts happy because they pay higher rates than ordinary accounts. No wonder they get world class Internet speed.

But when one talks of average speed, the excellent speed enjoyed by high end accounts cannot overcome the horrible snail paced crawl suffered by the ordinary accounts. For one thing, we small accounts put together are larger than the totality of high end accounts. So, the average speed is still a national shame, like the NAIA.

I initially didn’t think much about the speed even if at night I could hardly do anything that involves the Internet because everyone in my neighborhood is home and checking their Facebook accounts. Like anything else in our third world country, one gets used to puede na and accept such consumer abuse as par for our rotten course.

But every time my kids come home for a visit, they complain about the speed of my Internet connection at home. I guess they have taken for granted the speeds they get in California and Singapore. I don’t feel good trying to explain why the speed here is like the traffic flow in EDSA that I have learned to live with, aside from my occasional carping.

Is this another case of regulatory capture? Or something that everyone just philosophically accepted as our fate?

Cordova reassured me that NTC has not been captured by the telcos. But, he said, NTC could do better if they had the proper laws and the proper tools.

Cordova told me he has become the de facto complaint call center of some telcos who can’t get their act together. But there is little he can do with telcos who have no sense of customer service, he said, because he is operating under a Public Service Law passed in 1936 that only imposes a fine of P200 per violation.

The NTC chairman has been urging Congress to at least update the value of the fine to reflect today’s peso. He has asked NEDA to crunch the number so there are no questions on motives from them as regulators. 

As for our slow Internet speed, he thinks a quick solution doable in the short term is to implement IP peering, something like interconnection in the days of the old telcos but somewhat more complicated. This, Cordova said, “will limit national Internet traffic from using international bandwidth.” 

The problem today is that a good amount of domestic Internet traffic has to be unnecessarily routed abroad. But as was the case with the old telcos, the big established telcos argue that it is unfair to let their new and smaller competitors benefit from their infra investments. But Cordova seems set to make this happen even as he admitted this would only increase our broadband speed by 20 percent.

Cordova also thinks NTC should be allowed to invest some of the close to P5 billion it annually collects in supervision fees to deploy broadband network in underserved areas to ease traffic congestion. All that money now ends up in the General Fund. They can’t even use some of that money to buy test equipment. They end up borrowing the test equipment they need from the companies they regulate. How stupid is that? 

It is not unusual for governments to invest in telecom infra to increase internet access and speed, he pointed out, even in such bulwarks of capitalism like Australia which has invested A$46 billion, Germany Euro 36 billion and Finland $131 billion.  In Singapore, government gave a SG$750 million to OpenNet to build the broadband network providing at least one Gbps at SG$15/month for residential subscribers and SG$50/month for business. 

Even in the US, some cities are taking on some of the responsibility for building fiber optic networks as no private company has the incentive to connect everyone at a reasonable rate. The US government has also spent $7.2 billion to provide broadband access to underserved and unserved areas.

One other big reason for our slow speed can be traced to the three percent of subscribers who abuse so-called “unlimited” packages. Cordova doesn’t think banning the use of the word “unlimited” will affect the vast majority of users and will be closer to the truth in actual service provided.

Cordova said he understands the public’s growing complaints about the quality of our Internet service because access to it is now a right similar to water and power. But we have to modernize our laws to catch up with the fast pace of technology’s development. 

Cordova himself seems to have done his homework. He is now more familiar with the technical issues compared to the first time I talked with him in the early days of the P-Noy administration. For him to do his job well, he needs Congress and the Palace to do what they must. 

I frankly don’t think we can leave everything to the private telcos. The industry must be intelligently regulated. The first baby step has to be buying the testing equipment the NTC needs and then to modernize laws and regulations. Or we risk being left behind for good.

Boo Chanco’s e-mail address isbchanco@gmail.com. Follow him on Twitter @boochanco

ACCOUNTS BROADBAND CORDOVA INTERNET MBPS MYANMAR NTC SPEED TELCOS
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