IT has been months since President Duterte called for the entry of a third telecommunications firm in addition to Globe and Smart to improve Internet speed in the country and provide services that have become so vital to the country’s economic growth and development. He announced China’s interest in investing in Philippine telecommunications. Soon afterwards, other countries – among them, Japan, Australia, South Korea, and India – announced similar interests.
Problems, however, have since cropped up, principally the harsh reality that huge amounts of funding are needed to make an investment viable. Some P300 billion is said to be needed in the next five years if the new firm is to compete with the duopoly which have themselves invested billions in their operations over the years.
When the President called for a third firm to expand telecom services in the country, he noted that Vietnam has some 70,000 towers, compared to the Philippines’ 16,300. It will indeed take considerable funding to build all these towers all over the country, but the duopoly’s own efforts to build their towers have been frustrated by difficulties in getting permits from local government units.
The national government once proposed that it meet this problem by building common towers but the private companies fear this might infringe on their own business decisions. They have their own plans for expansion, including fiber optics, and would rather have their own towers.
The Senate is pushing for a bill to allow more open access in data transmission, which would remove barriers to the entry of new players, such as the certificate of public convenience, provisional authority, and other congressional requirements. Sen. Sherwin Gatchalian, co-author of the bill with Sen. Paolo “Bam” Aquno, said one reason for the present state of Internet service in the country is the fact that data transmission is governed by outdated laws.
Despite the absence of all the incentives proposed by various sectors, one firm, the Tier1 Consortium of Davao City, filed its bid last March 27 with the Department of Information and Communications Technology (DICT) to become the third telecom firm in the country. It said it will serve the rural areas in Mindanao and set up its first tower in Sultan Kudarat.
All these various developments are welcome; they will be incremental steps toward meeting the overall goal of improving Internet services in the entire country. But we continue to await the entry of a major Philippine consortium with support from a major foreign telecom operation.
When this third major firm is finally chosen, it will have to compete with the two established firms – which have themselves survived all these problems – in what has been described as a battle royale for public support. It will have such great business opportunities but it will also have to wrestle with the problems long faced by the duopoly, principally the problem of government red tape, such as getting permits for cellsite towers that now require at least eight months.
