MANILA, Philippines - Globe Telecom has called on rival Philippine Long Distance Telephone Co. (PLDT) to come clean by presenting the merits of its move to acquire Digital Telecommunications Phils. Inc. (Digitel), and to allay concerns about the threats to fair competition and consumer welfare mainly spurred by an imbalance in spectrum distribution.
“The burden of proof is PLDT’s to bear. They must prove to the public beyond doubt that their monopolistic hold on radio frequencies will not prejudice industry and consumers, now, and especially in the long-term,” Globe legal counsel Rodolfo Salalima said.
Globe said in the June 21 hearing conducted by the National Telecommunications Commission (NTC) on PLDT and Digitel’s application for the approval of PLDT’s acquisition of an initial 51 percent stake in Digitel, PLDT once again chose to obscure the real facts.
“By presenting witnesses who were incompetent to testify on facts related to the PLDT-Digitel transaction – financial controllers who essentially prepare and sign-off on financial documents, we are no closer to understanding the real deal. By their own admission, PLDT’s witnesses could not relay details of the transaction in question since they are beyond the scope of their professional function,” the Ayala-controlled telecommunications company said.
“Why PLDT put such witnesses on the stand is a mystery. As is the PLDT-Digitel deal still. And its impact to industry and consumers,” it added.
Salalima emphasized that the issue is PLDT’s monopolistic actuations. “They must be man enough to explain, and well,” he said.
As regard prior allegations made by Atty. Ray Espinosa, PLDT head of regulatory affairs and policy calling the rival telco “a case of highly selective and misleading memory,” Salalima stressed that as expected, “PLDT forces upon us its monopolistic arrogance by refusing to acknowledge their shortcomings to industry and the consuming public. Digging up old tales of perceived injustice done unto them, conveniently only now, is their way of muddling the truth and blatantly refusing to face up to the pressing issues at present.”
“Now that PLDT chairman Ma-nuel V. Pangilinan actually tells stockholders that a consolidated market is better than a competitive one, everyone including the government should be deeply concerned and exercise vigilance about the possible repercussions of the PLDT-Digitel consolidation that could adversely affect industry and consumers,” he added.
Salalima noted that contrary to Espinosa’s claim, back in 1999, even before the issuance of either a legislative ruling or a court order, Globe voluntarily became the first to agree to interconnect with Smart.
“In the interconnection case Globe vs. National Telecommunications Commission (NTC) and Smart, the Supreme Court reversed the NTC ruling except for the earlier interconnection agreement between the two telcos. However, despite the fact that landlines and interconnection have long been mainstreamed, PLDT still refuses to interconnect, ostensibly to protect its hold on the market at the expense of consumers. To this day, PLDT continues to buck the mandate for compulsory interconnection stated in Republic Act 7925, Executive Order 59, as well as a 1990 ruling by the SC,” he said.
He likewise pointed out that Globe supports equal treatments in the industry for bucket price offerings.
On the one hand, he said Smart and Piltel self-servingly wanted to sidestep inter-network interconnection back in May 2006 despite the fact that they were two separate public telecommunications entities (PTEs).
“Their facilities lease management agreement was crafted in such a way that it effectively combined the two PTEs for the use of one and the same network. As a result, interconnection charges were not levied on the two PTEs. Given PLDT’s claim that Sun Cellular will be run as a separate entity, the public must know if interconnection charges between them will remain,” Salalima said.
He further stressed that the future of unlimited services is uncertain with Smart and Sun Cellular. “Smart’s revenues were consistently challenged by the pressure of Sun’s unlimited services. In that context, PLDT’s motive for merging with Digitel is to relieve that pressure – but under a cloak of improved and expanded services for Sun subscribers. PLDT needs to come clean about cornering Sun’s radio frequencies and to maintain its unlimited services,” he said.
Salalima added that given how PLDT continues to ignore the interconnection mandates of the SC as well as the stipulations of the NTC, Republic Act 7925 and Executive Order 59, there is no way it can assure the public that it means to keep its promises.
He also said that Globe continues to push for interconnection for the benefit of consumers and that since 2006, Globe has requested for interconnection with PLDT in 32 areas, of which only the Davao point of interconnection (POI) was set up.
“Meanwhile, between 2009 and 2010, Globe completed its interconnection in 37 locations with both Digitel and BayanTel. Given that PLDT claims that there are no outstanding interconnection issues, we would like to know why the NTC had to intervene,” he emphasized.
Salalima also pointed out that the PLDT-Digitel deal should be clarified with other industry players as well as the general public. “A deal between PTEs and the scarce public resource that is radio frequency spectrum are issues vested with public interest. The public has every right to know,” he said.