The Internet is an American innovation that forever changed the way we communicate and do business. It was responsible for much of the wealth generated by the global online revolution. Unfortunately for us, we can only watch from the sidelines as others build their cyberspace empires because we are hindered by slow Internet speed. Thanks to President Duterte, the impending entry of a third telco player will give us a chance to improve our reputation as a nation with bad Internet connection.
More than 100 million Filipinos can’t wait for a third option from which to obtain Internet and telecommunications services. Duterte’s move to bring in the third party is seen breaking Globe and Smart’s duopoly, and will give relief to long-suffering telco customers who have been complaining of slow service, expensive charges and hidden fees. A third telco will certainly improve competition and help bring about improvements in the country’s telecommunication services.
The November 7 bidding for the third telco player is a milestone event under the Duterte administration. It was done in less than a year after the President ordered on December 19, 2017, the National Telecommunications Commission and the Department of Information and Communications Technology to tap a new telco player. Immediately, the NTC and the DICT held various consultations and public hearings with industry stakeholders, as well as local and foreign telecommunications experts to craft the terms of reference for the bidding.
In April Duterte issued Administrative Order 11 to create the Oversight Committee composed of the DICT secretary as chairman, the finance secretary as vice chairman and the Executive secretary and the National Security Adviser as members. In the consultations and public hearings that followed, all interested parties were made aware of the requirements for bidders and the TOR.
Invitation to bid was announced on October 7, 2018, and the next day, selection documents were made available for purchase. Every step of the way, the bidders knew what they’re getting into—requirements and all. The DICT and NTC did a good job making the selection process and the bidding transparent and aboveboard.
On bidding day, three groups submitted their bids out of the 10 entities that purchased the selection documents. Unfortunately, only one emerged as a qualified bidder and later on declared as third provisional telco player—Mislatel Consortium, a joint initiative between Davao City-based Udenna Corp. with its subsidiary Chelsea Logistics Holdings Corp. and China Telecom. From the very start, the selection process was open to the public. It was streamed live on Facebook, and attended by observers from the Commission on Audit, Department of Justice and the Philippine Competition Commission.
Still, the two disqualified bidders submitted motions for reconsideration with the NTC selection committee. On Tuesday the NTC panel denied a motion for reconsideration filed by the Philippine Telegraph and Telephone Corp. on its disqualification from bidding to be the country’s third telco company. Likewise, the panel also junked Sear Telecommunications Consortium’s appeal seeking to declare Mislatel Consortium—the lone bidder found qualified—guilty of misrepresentation of facts and concealing material evidence in the bidding.
With the entry of a third telco almost certain, it’s now in the hands of the DICT and NTC to put the chosen player to task. It should be made to account for all the promises it made. Mislatel has committed to provide Internet speeds of 27 Mbps on the first year, which would rise to 55 Mbps on the second year until the fifth year of its operations. This is much better than what is currently available.
What happens if and when the third telco can’t deliver on its commitments? Acting DICT Secretary Eliseo M. Rio Jr. said Mislatel will have to commit to its promises. Failure to do so would mean a cut from its performance security ranging from P14 billion to P24 billion.
NTC chief Gamaliel Cordoba said Mislatel, which committed to spend a total of P257 billion in five years, is required to follow a strict set of rules over a five-year period: “On its very first year, the consortium should be able to service 15 percent of the population—that is, 25 percent of cities, as well as 10 percent of first- and second-class municipalities and 5 percent of third- and fourth-class municipalities.”
It seems all is set for the awarding of frequencies, permits and licenses for the third telco to operate and roll out its infrastructure and services. This early, industries and consumers must prepare for the myriad benefits a fast-speed Internet connection can offer. The service can only get better when the duopoly will respond to the challenge and match (or exceed) anything that the third telco offers. This is expected, as they have to protect their market shares. All of these will ultimately redound to the benefit of Filipino consumers.