What you should know about the National Broadband Plan

MANILA, Philippines - Internet speed is an emotional issue in the Philippines. Throw in issues of pricing, reliability, and affordability into the discussion and you stir up a veritable hornet’s nest.

The strong public clamor for better connectivity was heard loud and clear at the first Telecom Summit held recently following news of President Duterte’s approval of the proposed National Broadband Plan (NBP) in a Cabinet meeting.

Department of Information and Communications Technology (DICT) Secretary Rodolfo Salalima confirmed the President’s nod to the plan, a move that the chief executive himself set into motion when he ordered the creation of the DICT in his first State of the Nation Address in July 2016 to improve local telco services.

Salalima explained that the NBP will be the platform enabler of the state’s e-government plan to have one digitized network for its online services for citizens, businesses, and government. It will also be the enabler of the government’s portal service project, which the government’s Wi-Fi project will be an important component.

“Government and countryside will benefit from the plan. We will be working with various stakeholders for the implementation,” he said in a press briefing. “It is also the Philippines’ contribution to the objectives of the ASEAN Masterplan of 2015 to make the region an ICT hub.”

What Exactly Is A Broadband Plan And Why Do We Need One?

DICT Undersecretary Dennis Villorente said that while the NBP is a critical component of the e-government program, the country needs a broadband strategy to accelerate the deployment of fiber optic cables and other technologies to improve internet speed.

“At the same time, we need to ensure that connectivity is made available and affordable, especially for underserved areas,” he said.

Various slides have been presented by speakers from the telecommunications industry, the academe, advocacy groups, the private sector and other government entities showing how the country’s internet speed and price compare with our Asian neighbors – all leading to the conclusion that there is a need for urgent action.

It isn’t, however, a purely doomsday scenario because improvements in fixed and broadband speeds have been noted in recent months even by third party international studies. Villorente explained though that there remain many weak areas, including affordability and inadequate infrastructure that the NBP may be able to address.

The DICT has uploaded the draft NBP on its website for the public and other stakeholders to comment in the next two weeks. The final approval will be sent to the President’s final approval and will be released as a formal plan of government by the end of this quarter.

Villorente said feasibility studies, scope, prioritization, technologies to be used, business model, potential RFP process will commence in the second quarter and selection of suppliers and contract signing for selected participants in the project is set for the first quarter of next year.

He clarified that the NBP is open and will adopt a multistakeholder approach, and is technology- neutral and inclusive because broadband content must be relevant and accessible to different segments of Philippine society.

“The NBP vision is to establish broadband as a basic right for all consumers, businesses, and government. We want more and accelerated investments and we seek to engage the public and private sector, including those from unserved and underserved areas,” he said.

How The NBP Can Help Improve Broadband Connectivity

Gamaliel Cordoba, commissioner of the National Telecommunications Commission (NTC), emphasized in his presentation and in the panel discussions that whenever we compare our broadband status to our Asian neighbors, we should bear in mind that almost all the countries we are comparing ourselves with have a national broadband network that was paid for by their governments.

“All governments know that if you put money in telecommunications infrastructure, any increase in speed results in an increase in GDP because of the effect in the economy,” he said.

In Singapore, the national fiber optic network project called Singapore One, a government-led initiative, was completed in 1998. The operation and maintenance of the national broadband network were auctioned under government terms and now it is constructing the ultra-high national fiber broadband network, which is a public-private partnership.

Malaysia has its own NBP developed in 1998, which was approved by the government in 2004. It’s a government-funded network operated by Telekom Malaysia, which is 80-percent owned by the government.

In Thailand, the NBP was approved in 2006 and 10 years later the national digital economy policy and plan (2016-2020) was also approved. Thailand TOT and CAT, which are government-owned companies are rolling out the network and the government is investing $1.1 billion to enhance it.

All three countries have open access networks.

Villorente said that in crafting the Philippines’ own NBP, the government is also looking at how it may be able to directly intervene in terms of investing in infrastructure.

He traced how connectivity gets to every household. “From the global internet, you need submarine cables to connect to cable landing stations that go through the backhaul and is distributed through the backbone and then through middle mile and last mile connections,” he said.

Every step of the way has significant challenges that need to be addressed.  

Broadband Defined

The draft NBP defines broadband as high-speed access that provides connection to the Internet. How fast can this be?

The NTC defines entry-level broadband as a data connection speed of at least 256 Kilobits per seconds (Kbps). The International Telecommunication Union, however, sets broadband transmission speed, according to standards set by the Telecommunications Standardization Sector (ITU-T), at 1.5 Mbps to 2.0 Mbps.

Under the proposed NBP, “entry-level broadband connection to the internet must have a minimum speed of 2.0 Mbps.”

“The minimum download speed that is recognized as entry level broadband will undoubtedly increase over time, so it will likely be needed to increase it over time to reflect changes in technology capabilities and user expectations,” the paper noted.

 One of the studies cited in the draft document is that the Philippines had 3.4 fixed broadband subscriptions per 100 inhabitants in 2015, which is lower than the 41.58 active mobile broadband subscriptions per 100, according to the  Broadband Commission for Sustainable Development’s Annual Report for 2016.

Another study cited shows that 46 percent of the Filipinos (out of a population of around 103 million) use the internet daily, while 30 percent uses the internet once a week, 16 percent uses it once a month and eight percent uses it less than once per month.

It is thus in the best interest of the country to improve broadband quality and increase usage to stimulate economic activity.

“Towards nation building, studies have shown that every 10 percent increase in broadband penetration boosts gross domestic product (GDP) by an average of 1.3 percent and every 10 percent increase in mobile telephone density results in about 0.7 percent of GDP,” Salalima noted.

Sean Gowran, president and country manager, Ericsson Philippines and Pacific Islands, affirmed in his presentation that the Philippines has great economic growth and potential. “It has a young population, a growing middle class, and great opportunities for business,” he said.

However, the landscape is changing. In Gowran’s view as a telecoms industry veteran, 2G is sinking, 3G is pretty stable for now but huge growth is coming from LTE. “In 2020 or thereabouts and beyond we will see the launch of 5G services. We are seeing the shift to much more data-intensive usage,” he said.

How the NBP may be able to help the country prepare for these global shifts in connectivity is exactly what the telecom summit seek to address. The draft plan, however, is looking at four outcomes: accelerated investments, public and private sector partnership, connecting more places in the Philippines to the internet and increased take-up rate for broadband services.

“Public service cannot wait. It must not be delayed,” Salalima said.

(Next week: The complex maze of challenges  for implementing Philippine broadband.)