DAVAO-BASED businessman Dennis A. Uy is no stranger to foraying into new industries and succeeding in them. He intends to continue to succeed now that his group won the third telco license.
During a bilateral meeting between the Department of Information and Communications Technology (DICT) and China Telecom Corp., Uy assured his group will make good use of the license awarded to Mislatel Consortium—a group led by the rising tycoon’s Udenna Corp. and the Chinese Internet provider.
“I promise you, we will work very hard towards achieving our common goals of better, cheaper and more widely available telecommunications,” he said. “I’m not a stranger to entering new industries and being a disruptor for the benefit of consumers.” Uy, who has close ties with President Duterte, has holdings in energy, water, petroleum, logistics, shipping, property, environmental trading, education and, more recently before telecoms, food.
“We accept the responsibility and challenge of being the new major player,” he said.
Exactly how is Mislatel going to do it?
Adel A. Tamano, the spokesman for Mislatel, said while his group will be building out its infrastructure from scratch, Mislatel intends to partner with both smaller and larger players to quickly roll out its investment program.
“For our rollout, we want to partner with them, not as equity partners, but as technical and resource partners. It’s a new model that we want to support,” he said.
Tamano was referring to smaller players such as disqualified third telco bidders Philippine Telegraph and Telephone Corp. and Sear Communications Inc., and incumbents Smart Communications Inc. and Globe Telecom Inc.
But as early as now, China Telecom—which may hold as much as a 40-percent stake in the future entity to be created for the third telco—signed a “joint letter of intent” with the DICT to connect the Chinese company’s submarine cable system to government’s cable landing station.
China Telecom’s fiber-optic submarine cable system will directly connect Hong Kong, the United States and the Philippines.
“This is our first step in providing the foundation for faster and cheaper Internet services for Filipinos. With this partnership, we are setting up our International Gateway Facility that is critical for world-class telecommunications services,” Tamano said. Aside from this, the group, he said, is “preparing” its rollout studies.
Mislatel has three months to complete all necessary requirements related to the post-qualification procedures for its confirmation.
Under the post-qualification requirements, Mislatel has to register as an official entity through the Securities and Exchange Commission. It also needs to get the necessary approvals from the Philippine Competition Commission.
It also has to comply with the paid-up capital requirement of at least P10 billion and implement the relevant provisions of the bidding agreement.
Mislatel is also required to seek congressional approval for any sale or transfer of capital stock, vesting controlling equity interests to another entity as provided in its congressional franchise, in which case, the franchise holder for the group is Mindanao Islamic Telephone Corp.
It also has to submit the business plan for the entire commitment period of five years, containing the capital and operational expenditures, the sources of funding, the projected cash flow, the planned technology deployment, the marketing plans and programs, indicative tariff rates, the key risks and mitigation strategies, and the existing agreement with existing technology players, if any.
Mislatel also has to submit its rollout plan, which should contain the following: indicative start of commercial operations, detailed schedules consistent with its commitments, coverage, technology, equipment to be used, target subscribers, service rates and a detailed description of how it ensures that its network and facilities will not compromise national security.
Upon the completion of the submissions for the post-qualification procedures, the regulator has to review the documents in relation to the commitments for 15 days.
Once done, the new major player has to submit its performance security—in Mislatel’s case, P25.7 billion—within 15 days.
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