The more, the merrier

Should it or should it not?

This is the dilemma now facing the National Telecommunications Commission (NTC) over the possibility of broadening the FM radio industry playing field.

Station owners, prospective investors, and even Congress, are eagerly awaiting the NTC’s move on expanding the airwaves to allow new players to come in. The decision is by no means simple since it will involve hundreds of millions of pesos in private sector investments that can come in if NTC allows it. The move will also improve access to information since there will be more radio stations operating. The music and entertainment industries will also get the much-needed boost, and so will allied sectors like advertising.

The issue revolves around the recent introduction of a hybrid type of transmission wherein digital audio signals can be transmitted together with analog audio signals, the type currently in use. The digital signal is placed within the analog signal to allow for simultaneous transmission. This means there is no need to introduce a new frequency spectrum because digital will work on the existing spectrum. More importantly, there is no interference of signals which is the main concern of station owners.

It is now possible for a band separation of 400 kilohertz (khz). The present NTC regulation dictates that FM stations must have a separation of at least 800 khz to avoid signal interference. Thus, after Monster Radio RX93.1, you have 93.9 (a 0.8 interval). Citylite 88.3 is followed by 89.1, etc. Within the 800 khz interval, no radio station is allowed to operate under current rules.

Enter the new technology of digital radio and the endless possibilities of a 400 khz separation. A recent study by the International Telecommunications Union (ITU), the United Nations agency tasked to oversee global standards in communications, concluded that 400 khz gap using digital audio signals will not cause interference. Thus, countries like the United States, the United Kingdom, Singapore, and Thailand are now using the 400-khz standard on digital audio technology.

The biggest beneficiary of a wider playing field will be the consumer. More competition means more and better choices.

Both government and Congress are open to idea, not only because it will allow new stations to open without a massive infrastructure investment require, but because it will force those who have not been using their legislative franchises to operate radio stations to finally utilize them. Some legislators have complained that many franchises granted were going to expire without being utilized simply because regulatory agencies like the NTC had failed to address loopholes in their rules.

Public interest now dictates that the NTC amend the rules now. After all, the commission is mandated to review its frequency allocation every two years ‘consistent with national priorities and demands for frequency usage.’ What’s more, the NTC is required to allocate frequencies based on standards set by the ITU.

So what’s stopping the NTC from amending its rules on frequency separation? Just asking.

Same rules should apply

The issue of good corporate governance had lately been injected into then public’s consciousness when business tycoon John Gokongwei Jr. attempted to take over the Philippine Long Distance Telephone Co. (PLDT).

PLDT president Manuel V. Pangilinan and the rest of the company’s directors and management invoked a provision of the PLDT by-laws and articles of incorporation prohibiting a competitor from sitting in the board. The conflict of interest and anti-competitor provision effectively blocked whatever dreams John Gokongwei Jr. had of buying into the country’s largest telecommunications company.

On the surface, the attempt by Gokongwei to buy a controlling stake in PLDT seemed to be a normal business transaction. First Pacific was selling and Gokongwei had the money to buy. It however, turned out to be not that simple. PLDT’s board of director had the fiduciary duty to protect the shareholders’ interest, regardless of the interest they represent. Gokongwei owns Digitel, PLDT’s staunch rival in the landline telephone business, and was thus declared to be barred from buying into PLDT. Many years back, Gokongwei was similarly prevented from buying into San Miguel Corp. and getting a board seat, this time via a court ruling. He owns Universal Robina Corp. whose products compete directly with those of SMC. And like PLDT, SMC had an anti-competitor clause in its by-laws.

Does this conflict of interest doctrine apply in the case of government corporations? Too often, we hear of government executives saying they have already divested their private businesses and interests to make them qualified for a government post. But has there been any effort made to check whether such divestment is in order and that the interests were not simply passed on to their next of kin?

There is no reason why said doctrine should not apply to public corporations. In this case, we are not talking simply of shareholders’ interest, but public interest. Government officials should be above suspicion in the conduct of their official duties.

A case in point is that of Jesus Alcordo, who was appointed overseer of the restructuring of the National Power Corp. (Napocor) and the National Transmission Corp. (Transco). His appointment is being objected to by the Napocor Employees Consolidated Union (NECU), the Executives Association (Exa), and the Napocor Employees and Workers’ Union (NEWU).

Alcordo, as former president of Napocor, run afoul with the entire Napocor personnel. He was declared persona non grata when he threatened to lay off half of them. Napocor employees simply have no respect for Alcordo. He is said to be the owner of East Asia Power Corp. which in turn owns part of Duracom Mobile Power Corp. Duracom along with the Manila Electric Co. were charged by former senator Juan Ponce Enrile of overcharging its customers.

The unions are wondering why Energy Secretary Vince Perez is insisting on Alcordo’s appointment. In a letter to the President, they have also expressed surprise why another East Asia employee, lawyer Ildbrando Ambrosio is being recommended by Perez to be in the technical working group of the energy restructuring committee. Ambrosio is said to be the same lawyer who defended Alcordo during the unions’ fight against the former Napocor chief.

The country does not have a dearth of talents so why insist on Alcordo’s appointment? Appointing persons whose loyalties are suspect leaves a bad taste in the mouth. It is just like assigning Dracula to guard the blood bank.

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