Government urged to stimulate investments in Internet backbone

The government has been urged to make the business climate more conducive to investments in the Internet infrastructure—where the Philippines is said to be lagging behind its neighbors in the region—due to the massive price tag involved, an official of the country’s biggest telecommunications provider said Monday.

Ramon Isberto, public affairs head of the Philippine Long Distance Telephone Co., said about $16.6 billion (P764.4 billion) was required to bring 2 megabits per second download speeds to 80 percent of Philippine households by 2016, citing a National Telecommunications Commission study presented to senators last year.

Isberto said the figure did not include investments required for small and large businesses.

He highlighted the amount as part of discussions on the preparedness of the Philippines for the integration of the member-economies of the Association of Southeast Asian Nations.

He noted that other countries like Singapore had been investing heavily in their network infrastructure.

“If we want to ensure that more and more Filipinos get to use the Internet in the coming years, the country needs to encourage sustained and substantial investments in network infrastructure and services,” Isberto said in his remarks distributed to the media yesterday.

“All of the countries that have been cited as models of good Internet services such as South Korea and Singapore had invested very large amounts of money to roll out the infrastructure needed to support such services,” Isberto said.

The discussions suggested that domestic telcos would need government support to roll out services at par or better than those offered by their regional peers.

He noted that while “a lot of work still needs to be done to further improve Internet services”, telcos have so far played a key role in the growth of the now booming business process outsourcing sector, which requires reliable and high-quality data services.

For PLDT alone, investments from 2010 to 2014 reached P160 billion and the company is spending another P39 billion this year, mainly to roll out more 4G and 3G-enabled cell sites and fiber optic cables for homes and offices.

Rival Globe Telecom, part of the Ayala Group, a few years ago launched and finished a $790-million network modernization plan.

Globe earlier announced that it was spending up to $850 million this year, mainly to improve high-speed Internet services.