Tower trouble
BIZLINKS - Rey Gamboa (The Philippine Star) - December 4, 2018 - 12:00am

Ramon “RJ” Jacinto may be credited for suggesting having common towers for the Philippines’ telecommunications industry. It is not entirely original, the concept already being practiced in China, Vietnam, Indonesia, and Australia, but he can be acknowledged for introducing the matter at a most opportune time.

As an appointed presidential adviser for economic affairs and information technology, we could presume that he has the ear of his boss, the President, and that the suggestion to have common towers in the country also has the Big Boss’ blessing.

Having a third party to build common towers for this island nation that can be used by the industry’s two powerhouses, Globe and Smart, and even a third entrant, Mislatel, should improve the user-per-cell site density in the Philippines, currently at about 4,000 people per cell site.

Compare that to archipelagic Indonesia’s 1,400 people per cell site or emerging Vietnam’s 914 people per cell site, and you get a pretty good idea of how much catching up we have to do.

To be able to give more Filipinos better internet access, former acting Information and Communications secretary Eliseo Rio Jr. said that 50,000 more cell sites would be needed to bring our ratio to about 1,000 persons per cell site – still a stretch from India’s 310 or China’s 380, but already acceptable.

Rio has been replaced by Senator Gringo Honasan with effect from Nov.  20, although the latter still needs to face the Commission on Appointments. This would change the complexion of things.

Unpopular move

RJ has been vocal about limiting the number of accredited companies to just two. It had turned out to be an unpopular move, one that has elicited numerous complaints from about all quarters.

Globe and Smart, understandably, declared unequivocal protests, even raising the possibility of legal action if the terms of their franchise contracts and constitutional rights would be impinged. Specifically irksome for them is the provision in the proposed rules that prohibits them from building their own towers.

After Globe registered its own subsidiary to build towers, the draft rules came out with conditions that accredited tower companies should not have any direct affiliation with an operating telecommunications company.

Globe has publicly expressed strong words against the draft circular, calling it “anti-competitive, retrogressive, and against global best practice.”

Even the Philippine Competitive Commission singled out the two-company stipulation in the proposed tower policy as anti-competitive, and counter to the government’s policy of encouraging open access especially in the telecommunications sector.

Ironically, the companies that have expressed a desire to build towers have also not been happy with the draft tower policy. For one, they don’t agree with RJ that a two-tower policy is non-negotiable, especially since the Philippines wants to build 50,000 as soon as possible.

Rio had not been outright supportive of RJ’s plan. Whose side will the new secretary take?

Biggest constraint

One of the biggest constraints that Smart and Globe constantly refer to when criticized about the slow speed of interconnection, the unavailability of telecommunication services in many parts of the country, and the instability of signals is the difficulty of getting towers constructed and licensed.

Firming up new sites to build towers is already a feat, but going through various local government requirements to get a license to operate a tower is even more difficult, and can take close to a year.

Accredited tower companies may likely face the same problems. This just demonstrates that the number of tower companies, whether two or more, is not the problem; it is getting the towers up and running that is the challenge.

In this regard, unless the DICT pays attention to unclogging the bureaucratic red tape of getting towers up with a few simple steps and within one or two weeks, it would only find itself running its accredited tower companies for not delivering on their contracts.

It’s easy to understand why most people in the national government would rather put off the task of straightening local governments’ capabilities to quickly deliver permits and licenses. Dealing with layers of local government units and officials and the multiple variances in procedures is a task even Superman would not want to accept.

No wonder, too, that the Philippines’ ranking in the World Bank’s Ease of Doing Business has remained at the bottom segment, and has not showed signs of improving.

Realistically speaking

Rio wanted to see a resolution to the tower policy within the month and to start constructing new towers early next year. With a new secretary, these schedules will need to be adjusted.

The new DICT head will need to be more familiar with all the intricacies brewing over RJ’s non-negotiable insistence of having only two tower companies. Getting a new policy that is acceptable to all, including a seemingly powerful presidential adviser, will not be an easy job.

Naming the companies that will be accredited to put up the 50,000 towers in five years would also need to be carried out with a thoroughness that would satisfy everyone, so that no threats of lawsuits are filed that could delay the actual implementation of a common tower policy.

Rio’s job is done, and the deadlines he has set may no longer be important. The former acting DICT secretary had displayed a zealousness for getting things done. We wait with bated breath to see how the new DICT secretary will resolve these troublesome tower issues.

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