Something fishy at the NTC

A major revamp seems to be in order at the Department of Transportation and Communication and the National Telecommunications Commission (NTC).

Several department heads of the NTC seem to have been deliberately misinforming the commission’s higher-ups when they recommended to the NTC board the granting of a provisional authority to Atlocom Communications Wireless System for an MMDS (multi-point multi-channel distribution system) cable TV license without first observing the due process involved in Atlocom’s application.

In a letter to the NTC, the Kapisanan ng mga Brodkaster ng Pilipinas (KBP) complained that without complete information on the true nature of Atlocom’s application, the company was granted a provisional authority on Oct. 8, 2003 by the commission.

And the KBP implied that NTC’s action to grant Atlocom said provisional authority and frequency allocation in the MMDS band specifically 2578-2596 MHz was made upon the order and direction of the Department of Transportation and Communication.

This all started when on April 11, 2002, the NTC released in various newspapers a draft circular on the reallocation of the MMDS band for fixed/broadband services. KBP opposed the draft circular on the ground that said reallocation should be subject to public hearings prior to its release and implementation.

NTC at that time agreed to exhaust all means to undertake the necessary consultation and to further study the matter. Then it decided to terminate all attempts to pursue the said circular.

However, just recently, KBP discovered that although the said circular was not issued, the reallocation of the MMDS band frequencies was implemented indirectly by granting to Atlocom specific reallocated frequencies even prior to an approved reallocation of the said frequency band.

The application filed by Atlocom in 1998 for an MMDS cable TV license did not prosper at that time because it was a complete failure in terms of the papers submitted to the NTC. It appears that Atlocom did not have the financial and technical capacity to implement its proposed project, aside from the fact that its application was incomplete. The application was revived five years later in April of 2003.

Specifically, Atlocom presented a generic MMDS technical plan. No technical plan was submitted for its proposed franchise area in Metro Manila and Cebu. Given the nature of over-the air transmission of radio signals, it is mandatory to submit more specific plans for operation of the system. On this point alone, KBP emphasized that NTC already had enough basis to deny Atlocom’s application.

Secondly, Atlocom failed to show that it had the financial capacity to support its application. No financial plan was submitted to the NTC. When it resurrected its application last year, Atlocom merely submitted a letter to the NTC saying that there was intent of a financial funding to make available a credit line once it gets the provisional license to operate. Attached were two letters, one from a Steve Berkoff offering venture capital, and another from Thomas Boyd offering a $5 million confirmable draft for the project which was unsigned and had a 30-day expiration window ending May 30, 2003.

When somebody asked former NTC commissioner Armi Jane Borje about the grant of authority to Atlocom and after explaining the flaws in the application, she said it was assumed that everything was in order considering that the application had to pass through at least three NTC departments, namely legal, broadcast, and frequency allocation.

KBP now wants NTC to recall the provisional authority to Atlocom as well as the frequencies allocated to it. It also asked the commission to refrain to granting MMD frequencies, including one to a certain VOM Broadcasting until such time that consultation and further studies have been made, and to investigate the individuals involved and the necessary charges be filed in court.

KBP chairman Cerge Remonde, who signed the letter and who was disturbed by the timing of the grant having been made a few months before the elections, said that unless action be taken immediately, the group will be constrained to bring the matter to the Office of the President.

Atlocom’s stockholders by the way are all from Negros Occidental. (Isn’t that where Jose Pidal hails from?) They are Patrick Millan, Rita Lo, James Chua, Francis Yulo, and Ramon Benedicto. The authorized capital of the corporation is P60 million, of which P8 million is subscribed and P2 million is paid-up. Too small for a project of this magnitude.

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