Final rules for third telecommunications firm released

More weight placed on faster internet speed

MANILA, Philippines — The government released yesterday the long awaited final rules and regulations on the selection of a new major player in the telecommunications market, paving the way for the entry of the third telco before the year ends as promised by President Duterte in hopes of breaking the duopoly in the sector.

Memorandum Circular 09-09-2018, which was published yesterday, contained the final terms of reference (TOR) for companies wanting to become the country’s third telco player.

Duterte has directed the National Telecommunications Commission (NTC) and the Department of Information and Communications Technology (DICT) to ensure the entry of a new major player in the telecommunications industry would provide the best possible services at reasonably accessible prices.

To do so, the DICT and NTC, with the help of the oversight committee, have decided to choose the third telco player using the highest committed level of service (HCLoS) selection model.

The HCLoS model consists of three selection criteria namely, national population coverage, minimum average broadband speed and capital and operational expenditures.

The MC will be effective 15 days after its issuance, or on Oct. 6.

After taking effect, interested parties can then get the bidding documents from the NTC at P1 million each. Submission of the selection documents is set on Nov. 5.

“Those who are really interested should work double time and fast,” NTC commissioner Gamaliel Cordoba said.

Cordoba said participating companies and the “provisional new major player” would already be known by Nov. 5.

The selection committee will then verify, validate and ascertain all the submitted selection documents of the provisional new major player within a period of three days and should all the documents be found valid, it will be declared as the third telco player.

The third telco player will have 90 days from the issuance of the confirmation order to submit documents necessary for the processing of the Certificate of Public Convenience and Necessity.

“We are confident that we will be able to accomplish the President’s mandate,” Cordoba said, noting that a third telco player would be in place before the end of the year.

According to Cordoba, the final TOR was a result of joint efforts by various agencies and consultations with stakeholders.

He said it incorporated suggestions from various position papers it received following a public hearing conducted for the draft TOR issued last Aug. 8.

Among the changes made for the final version was to give more importance to the minimum average broadband speed criteria, whose weightage in the scoring was raised to 25 percent from a previous 20 percent.

The national population coverage criteria remains with a 40 percent weightage, while the annual capital and operational expenditure criteria’s weightage declined to 35 percent.

“We increased that on speed because we want to improve quality,” Cordoba said.

The participants’ offered commitments will earn points based on established parameters over a five-year commitment period which shall become the basis for their ranking.

The final TOR also provides a more flexible performance security terms for the winning bidder. Bidders are also required participation security “to ensure those who are joining are serious,” according to Cordoba.