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New technology for faster Internet service

SINCE President Duterte called for a third telecommunications firm to help improve the country’s Internet services, many groups, local and foreign, have been mobilizing their resources to bid for this all-important third slot in an industry that has become so important to the country’s economic development and progress.

But even without the third major telco, the firms already in the field have been steadily boosting their services and drawing up plans for faster Internet connectivity. One such tie-up was announced the other day between power utility giant Manila Electric Co. (Meralco) and Philippine Long Distance Telephone Co. (PLDT) which plan to deploy 5G next-generation technology.

It seems Meralco’s poles are ideal for the new technology. They are lower and infinitely more numerous than the giant towers now in use by the earlier 3G and 4G technologies. The present Internet service providers – Globe and Smart – have long complained about the difficulty of getting government permits for their towers. The government has even proposed that it will build the towers for common use by the firms.

Meralco has also been recently in the news in a survey undertaken by the International Energy Consultants (IEC), an Australia-based firm specializing in Asian power markets. The survey found Meralco’s residential rates have gone down 8 percent since 2012 and are now among the cheapest in Asia, except that in many other countries, the government provides subsidies.

IEC Managing Director Dr. John Morris who led the study said Meralco’s tariff has increased by only 3 percent “despite the twin headwinds of significant fuel price increases and a depreciating local currency. Government subsidies, he noted, have played a big role in other countries. If subsidized markets were excluded, Meralco’s tariff would be one of the cheapest in Asia, he said.

Government subsidies today make power rates artificially low in Thailand, Indonesia, Malaysia, Korea, and Taiwan, the IEC said. The subsidies in these countries are in the form of cash grants, subsidized fuel, and deferred expenditures; they lower the tariffs by 41 percent. In view of the survey’s findings, our government might consider a subsidy program, like those of the other nations, to bring down power costs for Philippine households.

But government, with all its present problems, is not expected to do any subsidizing at this time, so private industry will have to carry on without government help. The plan of Meralco and PLDT to tie up to roll out 5G networks will be a major step forward. Without any substantial government help and using Meralco’s already established resources – its thousands of electric powerline poles – its partnership with PLDT and their introduction of new 5G technology is expected to provide faster Internet speed and more reliable connections around the country and with the rest of the globe by the year 2020.