Behind the sin

WHILE everybody here perhaps got busy over those several thousands of people comatosed by “shabu,” we overlooked this crashing strife in the fledgling Duterte administration.

The struggle involved the telecom sector, in particular the limited possible ways that we could upgrade the pathetic internet service in this country of more than 40 million users, among the highest in the world.

On the one hand, we have the newly established Department of Information and Communications Technology, or DICT, already pushing for the government digital backbone, the national broadband network, or the NBN.

The DICT, headed by a former corporate executive, Sec. Rodolfo Salalima, argued that, as the third player in the telecom industry, the government would also check any abuse of the existing “duopoly.”

The duo featured PLDT and Globe, and the two recently spent almost P70 billion to acquire the telecom businesses of the San Miguel group, the biggest ever business deal here.

The buyout happened to rile up another new government office, the Philippine Competition Commission, or the PCC, the Filipino version of anti-trust bodies in other countries, speedily set up early this year by the previous administration.

It seemed that the outgoing administration just had to rush the PCC, allowing it to put its own people in the commission with tenured positions.

Anyway, the two government outfits, DICT and PCC, seemed to be canceling out each other.

In wanting to set up the government digital backbone, the DICT indicated that, more than anything else, it aimed to provide the government with something that it needed since the last Ice Age: the highly “secure” broadband network.

As a bonus, the government project would naturally compete with the “duopoly,” in the process forcing the two dominant players to improve their internet services.

At the same time, the PCC seemed to be trying its best to block the San Miguel deal that, the “duopoly” insisted, they would need to upgrade their separate internet networks.

In the deal, PLDT and Globe would split up part of the radio frequencies owned by San Miguel, including the 700mhz bands, the ideal frequencies for the latest technology in broadband called LTE.

With their acquisition of those frequencies, PLDT and Globe announced plans to invest billions of pesos in their network upgrades.

It was the assurance that they offered to our new leader, the motorbike riding Duterte Harley, who already threatened them to better shape up in one year or else…

Despite the ultimatum thrown by Duterte Harley, PCC seemed bent on forcing them to miss the deadline.

For one, the PCC already blocked their acquisition of the San Miguel radio frequencies, now pending for the past three months and still counting.

Of course, the telcos sued the PCC before the Court of Appeals, claiming the PCC refused to apply the same rules on the telecom sector that it did on other companies that also had mergers and acquisitions in the past months.

All of a sudden, the PCC begged the CA for time, asking the court to extend the deadline on its submission of “comments,” asking for 30 more days.

Down here, we could only wonder what was taking the PCC too long just to file a freaking reply.

Remember, in the beginning of the PCC not too long ago, its freshly appointed officials promised us that, first and foremost, they would scrutinize the power sector—yes, the top priority.

Well, this country had the distinction of having the second highest electricity rates in Asia, and so the PCC wanted to check whether or not the industry acted as a cartel, plus of course whether or not it engaged in some “regulatory capture” on the side.

The PCC had yet to say a single freaking word on the power industry, both the generation and distribution sides.

All of a sudden, the PCC changed its mind and it would have to target the telcos first and foremost, in particular the P70-billion deal between San Miguel and the “duopoly.”

The PCC even gave its unequivocal blessing to the holding of a forum in which various groups bashed the telecom sector—without inviting any representative from the telcos, of course.

From what I gathered, everybody just agreed that the country would need a “third” player in the sector, most preferably a foreign company.

By the way, Globe and PLDT get their equipment from foreign companies, such as Huawei, Nokia-Alcatel Lucent, Ericson and Ciena.

For all intents and purposes, the two existing players were already foreign companies, right?

Anyway, the PCC seemed to be gathering public support for its move to block the upgrade plans of the “duopoly” by subjecting PLDT and Globe to trial by public opinion.

As a quasi-judicial body, in other words, even with brilliant lawyers and economists on board, the main decision making used by the PCC would be mob rule.

To think, the network upgrade of the telcos already took a crucial part the Duterte internet development plan–with a one year deadline, at that.

You see, for the program to lead us to internet heaven, the DICT would pursue the NBN on the part of the government, and then the existing players would have to upgrade their networks.

And the PCC just would have to stand in the way? Or was some other sinful group behind the scene?

According to studies, fast internet connection would generate untold economic benefits in the country—not just blissful enjoyment of this Pokemon Go”  craze among the addicts.

One estimate showed that, for every 10 percent increase in the number of broadband subscribers, the entire economy as measured by the GDP could rise by some 1.23 percent.

As of the speed of the connections, just doubling it could produce an increase in the GDP of some 0.3 percentage points.

Here is the deal: the other members of the Asean were already on their way to establishing dominance in internet service with huge investments.

The government of Malaysia has already spent some $4.5 billion over the past 10 years to install fiber-optic lines in every home in the urban areas.

Vietnam also became the largest investor in telecommunications among  Asean countries, with two of the three large telcos in Ho Chi Minh City owned by the government.

Thailand announced it would jack up its spending on ICT by some $20 billion this year to support what it called the “digital economy” program.

Indonesia shelled out $22 billion through PPP projects in internet service, aiming to bring down the rates.

As for Singapore, the city state was already way ahead of the Asean pack, as it already launched the next phase in its internet program, aiming to lower the rate to P500 a month for households and P2,000 a month for business, even offering out-of-this-world speeds.

As for the Philippines, did you know that we have the fewest cell sites in the whole of Asia?