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DICT keeps 3rd telco search alive

/ 05:08 AM June 25, 2018

The Department of Information and Communications Technology (DICT) plans to publish this week the draft selection rules for a new major telco player—a decision fueled by President Duterte’s directive to move the initiative forward.

“The President wants things to move again, that is why we are going to release the terms of reference,” DICT Acting Secretary Eliseo Rio Jr. said in an interview.

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Rio said he discussed the recent delays in the telco selection process with Mr. Duterte during the National ICT Summit in Davao City last week.

The decision comes despite differing views within the oversight committee crafting the rules on how the government should award a set of valuable 3G, 4G and potential 5G radio frequencies. These would be used by a new telco to provide mobile services and challenge the PLDT Inc. and Globe Telecom duopoly.

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An earlier major hurdle, multiple sources said, was the desire of the Department of Finance to have an auction of the said mobile frequencies—a first in the Philippines.

Rio declined to comment on disagreements within the oversight committee, although he said he was not in favor of holding a spectrum auction for the current third telco initiative.

Citing estimates from industry experts, he said an auction could raise $1 billion to $2 billion for the government. But he added that the exercise could also weaken a new major player’s financial prospects given it still has to invest in rolling out its network.

ICT advocates agreed, with some fearing that the disagreements within the committee will stall the selection process.

“It is so anticompetitive if we auction the frequencies,” Rio said, adding that Globe and PLDT subsidiary Smart Communications were never subjected to a spectrum auction.

Rio clarified he remained open to generating state revenues via frequency auctions after a third major telco player is chosen.

The decision comes after months of delays. The release of the terms is viewed as the start of the selection process.

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Rio said it was important for the public to see the draft rules, which were crafted with the help of experts from the United Nations’ International Telecommunication Union.

Interest from local and foreign groups also remains high, despite delays. “They are just waiting for the terms,” an individual privy to the process said in an interview.

The DICT released last April 13 the general guidelines detailing the financial resources and technical requirements a new major telco player must possess.

Among others, the interested company must have a paid-in capital of at least P10 billion and experience in operating telco services “for the last five years.”

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TAGS: Business, Department of Information and Communications Technology (DICT)
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