Private telephone firms shy away from DOTC's `Telepono sa Barangay'program

The Municipal Telephone Project Office (MTPO), an agency attached to the Department of Transportation and Communications (DOTC), said yesterday that none among the existing carriers is interested in taking over the government's Telepono sa Barangay (TSB) program due to its unprofitability and huge capital requirements.

As a result of MTPO is forced to push through with the multi-billion project if only to provide the much-needed telephone facilities in more than 20,000 unserved barangays nationwide, MTPO project director and DOTC Undersecretary Willie Evangelista said.

"I have talked to the private sector about this but they don't want to touch the program. With a limited budget, they could not even cover all the urban areas. So they are not interested in going to rural areas where they could not easily get a return on their investments. It (TSB) would be a big financial burden for them," he said.

In fact, he noted that the carriers who participated in the service area scheme (SAS) were not even able to comply with the government directive for them to put up lines in all the municipalities under their jurisdiction.

Evangelista said private companies had been given a chance to participate in the program as early as 1989 when MTPO was first created but no one has expressed any desire to do so.

Since TSB is the only way to ensure that everyone would have access to basic communications, Evangelista said MTPO will have to ensure that the project is implemented, but at the best deal for the government.

He explained that there will be no initial cash outlay from the DOTC for the TSB since it will be 100 percent financed by the export-import banks of US, France, Japan and Canada.

Moreover, 28 percent of the soft loan will be part of the overseas development assistance or grant and need not be paid for.

The remaining amount, he said, will be paid in 10 years plus a three-year grace period at a very low interest rate ranging from two-five percent per annum.

According to him, instead of DOTC operating and managing the payphones and subscriber lines, such will be leased out to existing carriers in the areas involved. Details of the revenue sharing with the private sector are yet to be threshed out.

Evangelista, likewise, said that the current MTPO administration has managed to drastically lower down the cost of the project.

Past estimates showed that the government will have to spend $86,000 to $160,000 per barangay for just five landlines.

The latest figure, he said, has brought down the amount to $41,000-$49,000 per barangay for 10 telephone lines.