PLDT, Globe set to clear highway for internet traffic

INDUSTRY giants PLDT Inc. and Globe Telecom sealed a long-awaited IP peering deal Monday with the aim of rapidly improving the quality of fixed-line and mobile internet services in the country.

The IP peering deal, which was six years in the making, meant data exchanged between PLDT and Globe customers would be treated as local content versus the arrangement in the past, when the data would still have to be routed overseas. Having the data go outside the Philippines meant added costs, a delay in data transmission and latency in downloading websites hosted by either network.

The move marked another area of cooperation between the two rivals, which last May 30 joined forces to acquire the telecommunications unit of San Miguel Corp. for $1.5 billion, the main target of which was the diversified conglomerate’s valuable radio frequencies.

The twin developments came after President-elect Rodrigo Duterte rebuked telcos for their slow data offerings and threatened to open the industry to foreign players.

“IP peering is only a piece of the puzzle. When you talk about faster, affordable and reliable internet, you are talking about a number of things that form part of your internet agenda,” Ray C. Espinosa, PLDT head of legal and regulatory group, said in a briefing on Thursday.

Espinosa said there was also a need to access additional frequency assets, international connectivity and local caching. He said caching, or storing data for future use, was needed since about 90 percent of internet content frequently accessed by Filipinos come from overseas.

Gil Genio, Globe chief technology and information officer, said the IP peering agreement would help the company save on expenses, which in turn would eventually translate to lower internet charges for customers.

Officials from both companies pointed out the main objective was still to improve internet services, described as among the slowest and most expensive in the region.

The IP peering memorandum of agreement specifically paves the way for the two companies to implement bilateral domestic peering within 30 days. A formal peering agreement is set to be signed by both companies within 90 days.

The bilateral domestic peering will cover PLDT-managed networks such as Smart, Sun and Digitel and the Globe networks that include Globe mobile, Bayantel, Ayalaport and Globe data center.