Gov’t lures 3rd telco player with planned frequency auction

The National Telecommunications Commission (NTC) is planning to roll out in early 2017 a landmark auction for its store of valuable 4G and 3G frequencies, saying there is mounting interest from smaller groups to become the country’s third telco player.

NTC Commissioner Gamaliel Cordoba told the Inquirer the auction—the first of its kind in the agency’s history—could count on assistance from the World Bank.

“Early next year, we can put this together,” Cordoba said, adding the final go-signal would come from the Department of Information and Communications Technology.

According to Cordoba, the spectrum assets to be auctioned off could include a portfolio of frequencies returned to the government across two merger deals in the last five years. It could also include the 10 Megahertz (MHz) 3G frequencies of Connectivity Unlimited Resources Enterprise (Cure) that PLDT Inc. was told to give up after buying out Digital Telecommunications Philippines in 2011.

Cordoba said the final size and scope have yet to be determined. But what has been decided so far was that the auction would involve a full set of 3G and 4G spectrum assets.

Furthermore, the auction would only be open to new players, he said.

That means incumbent players PLDT and Globe Telecom, which already roughly control 78 percent of all available telco frequencies, would not be allowed to participate.

But Cordoba said several factors also had to be considered before NTC could proceed with the auction.

There was the Philippine Competition Commission’s legal row with Globe and PLDT over their joint acquisition of San Miguel Corp.’s telecommunications unit on May 30.

The outcome of that case could affect telco frequencies that PLDT and Globe returned, including the 20 MHz of the coveted 700 MHz spectrum.

Cordoba said valuation was also an important factor since this could be the government’s first auction. He said the World Bank could come in to help in this area.

“The World Bank has approached us for the valuation, they want to be the consultant for that,” he said.

Cordoba said several groups have already sent letters to the NTC, expressing their interest in the frequency auction. He said one of the companies was Now Telecom.

But Now Telecom’s head Mel Velarde said the company should have been assigned mobile frequencies as early as 2006, given that it already had a cellular mobile telephone service (CMTS).

“We are awaiting for frequencies we deserve, which should have been given since 2006 when we got our CMTS license, which was renewed in 2015,” Velarde said. “Requiring us to bid for frequencies is illegal and corrupt practice.”