Duterte offers telecom role to China

MANILA, Philippines — President Duterte has asked China to invest in the Philippines’ telecommunication industry, a development that Malacañang said would break the “duopoly” that has frustrated consumers for years.

The Philippines’ data and voice services rank among Asia-Pacific’s slowest and most intermittent, prompting Duterte last year to warn providers PLDT Inc. and Globe Telecom Inc. to shape up or face new competition.

According to presidential spokesman Harry Roque, Duterte offered China the privilege to operate the third telecom carrier in the country during his bilateral meeting with Chinese Premier Li Keqiang last week.

“So the good news is, consumers can look forward now to better telecommunications, not just in terms of cellular technology but also in terms of internet speed as well as access. This is the latest instance of the President proving that he has the political will to do what is necessary to benefit the Filipino people,” Roque said in a press briefing yesterday.

The Chinese firm that would offer the telecommunication services, he added, has yet to be identified. China’s foreign ministry did not immediately respond to Reuters’ request for comment.

Duterte’s offer to China came as the Philippine government and Facebook affiliate Pacific Light Cable Network signed an agreement on the “Luzon Bypass” project, which is expected to improve internet connectivity in the country.

This project, Roque said, would provide bandwidth of two terabits per second or equivalent to the current capacity of the two telecommunications companies.

“The telecom duopoly is about to end with the entry of the Facebook subsidiary as well as the offer by the President of the People’s Republic of China to operate the third telecom carrier,” he added.

Asked why Duterte made the offer to China, the spokesman pointed out that China has the capital and technology to provide an “efficient” telecom service.

“With the number of subscribers that Chinese telecom companies have in China, there can be no doubt that they are among the biggest in the world. Consider also the proximity and the fact that we want to avail of as much economic advantage that we could arising from the renewed friendly ties with China,” Roque said.

Duterte is so serious about the entry of a new telco player that he wants all applications to be filed and acted upon directly by the Office of the Executive Secretary within 45 days.

“That’s how serious the President is in allowing a third party carrier to come in,” Roque added.

Eliseo Rio, Department of Information and Communications (DICT) officer-in-charge, welcomed Duterte’s offer for a third player, saying this will surely benefit consumers.

Salalima blamed

Roque said the process of breaking the telco “duopoly” would have been sooner but former DICT secretary Rodolfo Salalima did not sign the deal with Pacific Light.

“This agreement with the subsidiary of Facebook should have been signed as early as December 2016. It was not signed by the former secretary of the DICT and this was one of the areas pinpointed by Cabinet investigators as an area of conflict of interest,” he explained.

He added that the special investigating committee “further reported that the former DICT secretary likewise may have prevented the earlier breakup of the duopoly by delaying the use of satellites as viable option.”

Salalima, former chief legal counsel of Globe Telecom and classmate of Duterte at the San Beda College of Law, resigned last September, citing alleged “interference” and “corruption” in the agency.

But Duterte refuted the claim, saying he had asked Salalima to quit because of complaints that the former DICT chief was favoring one company.

Roque claimed that Salalima pushed a national broadband scheme that would retain the “duopoly” in the industry.

He said the initial costs for a national broadband plan appeared excessive at P200 billion since the recommendation did not consider the contribution that could be made by existing broadband providers like the National Grid Corp., National Transmission Corp., Fiber Optic Alliance and the Philippine National Railway Communication Project.

“Now, it would appear that under the scheme being pushed by the former secretary of DICT, the NBP (national broadband plan) terrestrial backbone would still have left the duopoly with the right to connect the end users to the backbone. And this after government would have spent already P77 billion,” Roque explained.

Malacañang, he added, is leaving it to the ombudsman and the Anti-Graft Commission to determine if Salalima is liable for sitting on the project.

Meanwhile, Science Secretary Fortunato dela Peña said the Luzon Bypass Infrastructure project is the first of its kind for the Philippine government and could boost the country’s effort at improving internet connectivity.

He explained that the project will pave the way for an ultra high-speed internet backbone that can go up to 100 Mbps for the entire country by the end of 2019.

The Bases Conversion Development Authority will build two cable-landing stations connected by a 250-kilometer long cable network corridor.

Facebook, as the first user, will construct and operate a submarine cable system that will land in the cable stations on the east and west coasts of Luzon. This link will provide direct access from the Luzon grid to internet hubs in the United States and Asia.

Facebook will provide the Philippine government with a bandwidth of at least 2 million Mbps or 2 Tbps that is almost similar to that being provided by leading telecommunications companies in the country.

For its part, the DICT will operate the Luzon Bypass Infrastructure, maintain the related facilities and provide last mile connectivity in the Philippines for a period of 25 years.