3rd telco gets 6-month reprieve on commitments

Telco startup DITO Telecommunity is catching up to meet its commitments to the government after plans were derailed by the new coronavirus pandemic.

Citing the health crisis, DITO sought and obtained an extension of the July 8, 2020, deadline for a technical audit from the National Telecommunications Commission, company chief administrative officer Adel Tamano said during a media briefing on Friday.

The NTC set the audit after six months or on Jan. 7, 2021.

Tamano downplayed the delay, saying the company was on track for its March 2021 commercial launch, which is when paying subscribers can avail themselves of DITO’s services such as text messaging, calls and mobile internet.

“We’re moving heaven and earth really to make that happen and to make it a successful launch,” Tamano said.

DITO is owned by Davao-based businessman Dennis A. Uy’s Udenna Corp. and state-run China Telecom. It was selected as the country’s third major telco player following a government-led bidding exercise in 2018.

Under its first-year commitment to the government, DITO was required to cover 37 percent of the Philippine population and provide a minimum average internet speed of 27 megabits per second (Mbps) by July 8. This will then be checked by an independent auditor for compliance.

However, during a Senate hearing on Wednesday, Tamano said the company had finished 300 operational cell sites or less than a quarter of the 1,300 needed to meet the target.

DITO chief technology officer Rodolfo Santiago said the 300 operational towers covered 9 percent of the Philippine population. He said DITO could activate all 1,300 sites by October barring further delays caused by the pandemic.

Apart from the 300 operational sites, DITO has built 500 towers while the rest are underway. By the end of its fifth year, DITO promised to cover 84 percent of the population and an internet speed of 55 Mbps.

The NTC had earlier set strict rules to ensure DITO’s compliance. It also allowed a grace period or “two remediations” of six months each under the five-year commitment period.

Tamano said on Friday the delay was caused by the pandemic and thus DITO was not undergoing any remediation. This means the NTC extension until Jan. 7, 2021 will not be counted against the grace periods provided in its contract.

This provision is crucial because if DITO fails to meet its commitments beyond the grace period, the national government will seize its P25.7 billion performance bond and recall the assigned radio frequencies.

DITO also reported progress in its rollout, disclosing that it made successful calls last March 27.

The calls were made in North Luzon, Metro Manila, South Luzon, Visayas and Mindanao using network gear from Chinese companies Huawei, ZTE and Huaxin. Two international phone calls were also made to Hong Kong and Beijing in China with China Telecom.