All eyes on 3rd telco as China-backed firm downplays delays

The country’s third major telco, Dito Telecommunity, could take its first paying subscribers by March 2021—delaying a debut that was anticipated as early as July this year.

The actual deadline for commercial operations was clarified on Thursday by officials of Dito, which is owned by Davao-based businessman Dennis Uy and state-owned China Telecom.

Dito also sought to dispel rumors it was having trouble financing its P257-billion rollout that was committed over the next five years.

Adel Tamano, Dito chief administrative officer, said on Thursday the company was on track for its “technical launch” on July 2020, which comes a year after Dito was issued its license to operate.

This means the National Telecommunications Commission, with the help of an independent auditor, will asses whether Dito had complied with its first-year promise to cover 37 percent of the Philippine population and provide an average speed of 27 megabits per second.

This differs from a commercial launch, which Tamano said would come no later than March next year since Dito still needed to first test its network.

“Perhaps, people will call this a delay but I think at the end of the day, the consumer will be happier,” Tamano said.

He noted Dito could launch earlier than the deadline mandated in its license, formally called the certificate of public convenience and necessity (CPCN). Dito said in a July 8, 2019, statement that it planned to “start commercial operations by 2020.”

The CPCN also indicated other key milestones such as making its first phone call by May this year and the start of precommercial trials by September.

The commercial launch date is what matters most to customers and Dito chief technology officer Rodolfo Santiago said they would be present in major urban centers in Luzon, Visayas and Mindanao.

He said Dito has started 600 base installations while it expected to have 1,600 cell sites by July. This was enough to meet the 37-percent coverage requirement, the company said.

Tamano also said the company had secured financing for the first phase of its rollout after drawing down an initial $500 million (P25.3 billion)—about 10 percent of the five-year commitment—from the Bank of China.

“We are confident to say in the next couple of years we have sufficient resources to roll out,” Tamano said.

The money will be used to build network infrastructure, buy equipment and secure lea­ses. So far, Dito’s rollout is being financed by overseas banks, Tamano said, without elaborating.

Santiago said the company would also build its own domestic submarine cable and lay down a fiberoptic network spanning 10,000-15,000 kilometers. Dito would also lean on China Telecom for its international cable link, he said.

By the end of its commitment, Dito promised to cover 84 percent of the Philippines and offer a minimum average speed of at least 55 mbps.

The company now has about 200 employees, about half of which are Chinese technical staff, according to Tamano. That number is expected to balloon to 1,000 by the end of the year, mostly Philippines-based sales personnel as Dito prepares for commercial operations.

Santiago said Dito would also ensure the security of its network amid spying concerns from China.

Dito, named the country’s third major telco in 2018, was established to answer the Duterte administration’s call for more competition in the telco sector, which is controlled by incumbents PLDT Inc. and Globe Telecom.