Common tower policy: Getting ‘facts’ straight
BIZLINKS - Rey Gamboa (The Philippine Star) - January 8, 2019 - 12:00am

In coming up with a policy that will affect the nation, it is important to secure stakeholder views to build consensus. Such discussions allow for a healthy framework that will become the basis for an orderly and fruitful promulgation of what has been agreed on.

Unfortunately, we are seeing the opposite of this behavior in the process of creating a common tower policy. What was initially received with so much enthusiasm is now in the midst of multiple protests and lawsuit threats, leaving us to wonder just where this will all lead to.

On top of that, we are witnessing a public squabble involving two key players overseeing the process, one that has prompted Sen. Grace Poe to issue a statement urging “the government bodies on board to get their acts together.”

Sen. Poe said: “There should only be one voice on this matter, otherwise, it would send confusion to the telcos and the public.” Well, this columnist is more concerned than confused.

The task at hand is not to be taken lightly. The Philippines has one of the highest user-per-cell-site densities in the world, currently at 4,000 people per cell site. Vietnam, which has a slightly lower number of internet users compared to the Philippines, has a user-per-site ratio of about 900 only.

In Cotobato City in Maguindanao, for example, Globe Telecoms admitted it had 246,700 active users sharing only 13 cell sites. Between Globe and Smart Telecoms, the former has been experiencing more pressure after increasing its data traffic take-up by almost 50 percent in the first nine months of 2018.

Getting permits to build

One big problem, as Globe and Smart point out, is in getting all the paperwork signed and delivered to put up cell sites. Globe says it takes an average of eight months and over 25 permits to be able to lay the first cornerstone of a cell tower.

Local governments have different requirements on top of guidelines imposed by homeowner associations, gated subdivisions, building managements, and the Housing and Land Use Regulatory Board. This only underscores the need for one set of requirements, if only our government regulators could focus on the work at hand.

This brings us to the biggest issue, which is getting a common tower policy that will truly benefit the nation at the soonest possible time. Sticking out like a sore thumb is the insistence of presidential adviser on economic affairs and information technology communications Ramon “RJ” Jacinto on having just two tower companies and excluding existing telecommunication companies Globe and Smart from building their own towers.

‘Industry standard’

RJ’s insistence to confine the task of building 50,000 towers over the next four years to only two players needs to be substantiated by irrefutable data. It is not enough to just state that two common tower firms are more than enough to serve the needs of three telecommunication companies.

Similarly, RJ’s claim that “the industry standard is [that] tower companies number half of the operators in other countries, so in the Philippines, two licensed tower companies in the initial four years [are] more than enough, since there are only three players,” has to be backed by supporting facts.

This claim is belied by data presented by TowerXchange, an independent media platform for the global tower industry, that countries like India and Indonesia with high numbers of cell towers are those with the most number of tower companies.

India, one of the first Asian countries that adopted tower sharing, currently has eight tower firms serving three major telecoms that account for 61 percent of the market. Indonesia, an archipelago like the Philippines, relies on 11 independent tower firms to serve five major telecom operators.

RJ should also have a credible explanation to the concerns flagged by the Philippine Competition Commission and the Office of the Solicitor General that accrediting only two companies to building 50,000 cell towers is anti-competitive and would run counter to the government’s commitment to encourage open access in the telecommunications industry.

Heck, even the interested tower companies do not think that more than two tower companies would be uneconomical.

Infringement of rights

Globe wants the government to give its newly formed tower company, GTowers Inc., a chance for accreditation under the common tower policy. RJ has consistently denied this request, initially reasoning out that Globe and Smart have betrayed public trust by not being able to build more towers.

Recently, RJ has been pointing out that tower companies need to be independent from existing telecommunication companies for security purposes, specifically against cyber attacks. How this threat exists should be explained in more detail.

Smart, through PLDT, and Globe argue that their legislative franchises give them the right to own and establish cell sites, and that denying them of this could lead to an infringement of their rights. Their continued difficulties in setting up towers, they argue, stem from delays in securing permits.

Regulator’s heavy hand

Clearly, the initial common tower policy draft reflects the government’s impetuousness to impose a heavy hand on the telecommunications industry through stiffer measures and controls. Unfortunately, as history will bear out, this will ultimately distort the free market system.

By having only two accredited tower companies, the risk of having an inefficient duopoly is a big possibility. We have seen how easy it is for monopolies (or duopolies) to become complacent in their delivery and pricing of services and products.

In a free market, government should encourage competition by allowing more players.

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We are actively using two social networking websites to reach out more often and even interact with and engage our readers, friends and colleagues in the various areas of interest that I tackle in my column. Please like us on www.facebook.com/ReyGamboa and follow us on www.twitter.com/ReyGamboa.

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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