No change soon for better internet
BIZLINKS - Rey Gamboa (The Philippine Star) - July 10, 2018 - 12:00am

There’s news that the duopoly has agreed that all prepaid cellular “load” will now have an “extended” one-year validity period. This should be a welcome change for those complaining about losing “load” credits they paid for even if they had not used them.

Does this apply to those more popular load offerings these days that come with unlimited calls or text messaging, even online “surfing” access, but within a limited period, i.e., all-text for 24 hours, all-text-and-call for three days, etc.?

I hear that many Filipinos feel these offerings are worth the money they pay for. For example, they pay P30 to be able to carry unlimited quality conversation with relatives or friends for 24 hours as long as it’s within the same network.

Knowing how our countrymen carry on with exchanges over the phone for hours, these kinds of “unli” promos are favored over “regular” load purchases nowadays. Will these “unli” offerings go away?

Will the acceptance by the duopoly of this order by the National Telecommunications Commission (NTC) that extends the validity period of loads to one year push aside a bill filed in Congress seeking for a total expiry ban on call and text cards?

National broadband plan

The Philippine telecommunications industry is indeed such a complex animal, shaped not just by the dominant position of two existing players, but also by the complex laws and chameleon-skinned politics of the country.

At the moment, the current administration seems hell-bent on giving wings to its National Broadband Plan (NBP) while at the same time finding a third telecommunications company that will truly compete with the brands of the Smart and Globe duopoly.

The NBP’s over-arching objective is to improve internet speeds while opening up connectivity throughout the government’s units and agencies and providing free internet access for everyone in all public spaces with at least speeds of 10 Mbps.

Many developing countries are adopting their own broadband plans in recognition of the role that internet connectivity plays towards speeding up national development and bringing inclusive growth of those in the countryside.

National broadband plans, when state-funded, require billions of dollars. For many developing nations, the best option is to find a private partner who will build the infrastructure, and subsequently operate it for a tolling fee.

No change anytime soon

Internet speeds in the Philippines have marginally increased over the years for a variety of reasons as spouted by PLDT/Smart and Globe. Yet, even with the exit of smaller industry challengers in the past, the profits for the dominant players remain lucrative while markets remain underserved or unserved.

Thus, with the apparent government resolve for a third telco, the duopoly is allocating substantial capital funds to improve and expand their services. Globe is even getting into the business of building new cell sites that can be shared with other telcos.

Still, with the possibility of a third telco being named only later this year, most probably in the last quarter (instead of originally in the first quarter), any real progress in improving internet speed will realistically take two or more years. There will be no significant change anytime soon.

The same could be expected of other NBP objectives, including better access of internet services in the rest of unserved and underserved areas, lower rates, a networked bureaucracy, and free connectivity in public places.

Forging ahead

In the meantime, the Department of Information and Communications Technology (DICT) has admirably forged onward to deliver what had been outlined in the NBP. Rightly, the President has uncharacteristically been yielding to the DICT’s arguments for extensions in the deadline of choosing the third telco.

Last month, as a result of numerous stakeholder consultations, what is believed to be yet the best terms of reference that will guide in the selection of a third telco was made public. A scheduled bidding this quarter now looks attainable.

With firm commitments to a host of deliverables within its first years of operations, the chosen third telco is expected to be able to provide the necessary competitive mettle that can challenge the duopoly, like what Digitel’s Sun Cellular did in the early 2000s.

The government is forging ahead too with its plan to contract third parties to build common towers that can be shared by telcos. The accreditation of independent companies that will construct 50,000 more towers is expected next year.

The DICT has also asked the National Telecommunications Commission (NTC) to bring down interconnection charges between telcos. This is seen as a means to help the third telco when it starts operating.

Amending the telecom law

After passing a law granting free internet access in national and local government offices and public places last August, the Duterte administration is looking at passing a new law that would reclassify internet services as simply a basic service.

The objective here is to give the NTC more teeth as a regulator that will be able to impose minimum service standards from telcos. The bill is also a way of introducing changes to the 23-year-old Public Telecommunications Policy Law whereby the NTC’s jurisdiction is over landline voice calls only.

It’s a pleasant surprise to see how the government is trying to solve one of the country’s biggest problems, using a bit arm-twisting (like when the President “asked” PLDT to return some of its frequencies), but still within the bounds of reasonable governance.

Let’s hope this will indeed eventually bear fruit for the good of the whole nation.

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Should you wish to share any insights, write me at Link Edge, 25th Floor, 139 Corporate Center, Valero Street, Salcedo Village, 1227 Makati City. Or e-mail me at reydgamboa@yahoo.com. For a compilation of previous articles, visit www.BizlinksPhilippines.net.

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