Hype and mighty | Inquirer Business

Hype and mighty

/ 05:14 AM November 27, 2017

Recently the motorbiking Duterte Harley proclaimed—again—the earthshaking news that he would allow foreign companies in the telecom sector.

Immediately his new spokesperson, the high and mighty Sec. Harry Roque, concluded: “Consumers can look forward now to better telecommunications.”


How we wished down here that it would be that simple. But then again it could also be just all hype!

The problem of course was our slow and expensive internet that, according to the administration, was due to the duopoly of PLDT and Globe.


Apparently the two slackened in their internet services, on purpose, it seemed, and for no reason at all but sheer hatred of their customers.

Anyway, the solution would be to break the duopoly with the entry of foreign firms, preferably Chinese telcos.

Facebook recently signed a joint venture with the Philippine government on a project called “Luzon Bypass Infrastructure,” paid for by the government at almost P1 billion, which Facebook would use to link—overland— its submarine cables in the Pacific Ocean and the South China Sea, which the government then could use at no cost.

By the way, Facebook— just like Google—wanted to become a telecom player to operate the “highways” in which its contents would run.

In China, the entire telecom sector has always been a monopoly, with the three players all government owned, including China Telecom and Unicom, the only two with fixed broadband service – i.e. internet.

Hey, imagine that, there is also a “duopoly” in China!

Anyway, for any foreign company to operate here, the administration of Duterte Harley must amend the Constitution, which limited foreign ownership in utility firms to 40 percent at most.


How hard would it be to amend the Constitution? Let us just say that, after several attempts, it has never been touched in the past 30 years.

And then the “new” foreign telcos would need franchises from Congress that, the last time I checked, would cost shiploads of money.

On top of that, the roll out of the actual infrastructure like cell towers and cables and such would take years, if not decades.

Thus, the entry of the new foreign telco to improve our internet service, at best, would be, well, “wait and see,” meaning, it could or it could not happen.

Now the duopoly of PLDT and Globe also had to contend with the antagonistic policies of the government, such as those of the newly formed Philippine Competition Commission.

For more than 18 months now, the PCC still refused to approve the duopoly’s purchase of the 700-MHz bandwidth of San Miguel, which they would need to improve the internet service.

Never mind that the Court of Appeals already chastised PCC, nothing that, while rules called for “automatic approval” of the deal, PCC insisted on reviewing it, demanding more documents that did not even exist.

The CA even used a word to describe PCC: “whimsical.”

Take the joint venture between Globe and Ant Financial (owned by Chinese billionaire Jack Ma) for the digital—i.e. cashless—payment system here. PCC took eight months to approve it, afraid that the venture would corner the market because of lack of competition.

Somebody should have told PCC that, precisely, it was a pioneering venture.

That would be the regulatory framework that could also embroil all those future prospective soon-to-be Chinese or the American teleco player as saviors of our internet.

Our best option would still be the government itself investing in the infrastructure, much like what most other countries did.

In the United States, the big telcos also already sold their cell towers some 10 years ago, since ownership gave them no advantage in gaining market share.

Thus the telcos merely leased the same towers at the same time for less cost.

Here we insist that telcos should build their own cell towers, one at a time, which would need 25 permits each, not to mention the prohibitive costs.

Why could the government not do the internet infrastructure as part of the “Build, Build, Build” program of the administration of Duterte Harley and then just charge the telcos internet “tolls?”

Because it was not part of the plan!

Nobody is even sure we have a plan.

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