One of President Duterte’s pet peeves is the telco duopoly. During that dinner we had with him last month, he said he fired Rudy Salalima as DICT secretary because he was not doing anything about breaking the duopoly. To the President, a third telco is essential in making the two current telcos compete by giving better service.
No one has been appointed to replace Salalima. In the meantime, DICT is in the very able hands of retired Gen. Eliseo Rio Jr., an old hand in telco regulation. He is the senior undersecretary and officer in charge of DICT. The retired general previously worked with the NTC.
I have known Gen. Rio way back when he was just a major assigned to Project Sta Barbara, a military think tank organized by then executive secretary Alejandro Melchor. They were supposed to research and develop means of making the armed forces more self reliant. *
|Why o why?? (photo credit to owner)|
One of the concerns of that think tank is energy and that’s where I came in. I was with Petron but working on energy self reliance projects of the then Ministry of Energy. It gave me the opportunity to be acquainted with the then Major Rio.
Some years ago, I met the already retired Gen. Rio, then the NTC commissioner. He took time to give me a briefing on government’s strategy in the telco industry. He was the same low key technocrat I knew from way back. I can trust his word because he has no conflicting ties with industry and it was obvious he was working for the country.
It is the same Gen. Rio who gave his analysis last week on why we are having broadband problems with our current carriers and his prescription on how to give us relief. He didn’t call a news conference but simply posted his views on Facebook. Here it is.
“While the general perception of the public is that internet access here in the Philippine is slow and expensive, we could not be the world number one BPO voice service provider if our internet speed is slow and its cost is expensive. Our problem is that most of us access the internet on the mobile data infrastructure of telcos. We don’t have enough cell sites for our volume of traffic.” *
“The reason why we have such a small number of cell site towers (Vietnam has 70,000 towers compared to our 20,000) is that we need 25 government permits to construct one cell tower. Also for more than a decade since 2002, the killer application in our mobile network was TEXTING, where we became the texting capital of the world.”
“With nearly a billion SMS sent and received a day, the telcos were getting most of their revenues from this single service. AND THE 20,000 TOWERS ARE MORE THAN ENOUGH TO HANDLE THE SMS TRAFFIC. So there was no real incentive to install more towers.”
“But when the smart phones and tablets become popular and texting is being replaced by Facebook, Twitter and Viber, suddenly the number of cell sites became inadequate. In other countries, voice instead of SMS was the more prevalent source of revenue and it requires much much more towers to handle the voice traffic than SMS, making it easier for them to quickly adjust to internet content.”
“Now we have a lot of catching up to do, as it turned out that short messaging system (sms) was a short-lived bonanza. And because we lack cell towers, congestion in connectivity would likely happen. We need at least 67,000 towers to improve our mobile data access and we only have 20,000 now.” *
“The following are DICT’s planned solutions:
“With the Free Internet Access in Public Places Act (RA 10929), the government will put up tens of thousands of Wifi Access Points (APs) in public places to help decongest cell sites. When hundreds of APs were installed along the MRT-3 tracks in EDSA giving free WiFi to the public, an average of 700,000 people daily accessed these which greatly decongested the cell sites covering EDSA.”
“The government will construct common towers to be leased to telcos, which when added to the telco towers built or to be built will attain the needed 67K at the earliest possible time.”
“An EO is awaiting signature of the President to lessen the LGUs and National Government Agencies (NGAs) permits to built towers and limit approval/disapproval to seven calendar days. If not acted upon within seven days, the application is deemed approved. If denied, an explanation why must be submitted to the Office of the President within the same period.”
“Government will encourage applications and content that will make people subscribe to high speed internet to their homes, such as being able to work and study at homes. The savings in time and money from not suffering the traffic in Metro Manila even for once or twice a week, would be more than enough to pay for the subscription to high-speed internet. We will soon have a Telecommuting Law to address this.” *
As I said, Gen. Rio gave a plain common sense analysis and offered solutions that we have been talking about for years with nothing much happening. Government is partly to blame for the lack of cell sites because of red tape and corruption at the LGU level. But the failure of the private sector to invest showed lack of foresight. Sad to say, our telcos were caught napping.
It is common knowledge in the telco industry that LGUs were demanding all sorts of fees, legal and otherwise, from telcos for every cell site they want to build. In some Metro Manila LGUs, I heard that some councilors have demanded as high as half a million pesos in goodwill money for permits to be given.
The idea of a common cell site that the telcos can lease is a way of cutting the costs needed to quickly build the needed cell sites. DICT wants government to build these common cell sites but it could also be built by a private sector property developer to save government funds.
The Facebook post of Gen. Rio elicited many reactions from private experts in the telecom industry. I will digest some of those comments for a future column as this is the only space I have for now.
I will also take up the road map Gen. Rio posted on Facebook in my next column. *
Suffice it to say that I think government is sincere and finally moving on our long festering telco issues. Maybe, if the unassuming but technically capable Gen. Rio is given a permanent appointment, he will have more clout to do what must be done.
Gen. Rio can be trusted to have no conflict of interest. And as a senior citizen who spent a lifetime serving the country, I don’t think he has a desire to enrich himself and risk tarnishing a life long illustrious career.
The article was written by Mr. Boo Chanco (DEMAND AND SUPPLY) of the Philippine Star titled “Slow internet” which was published October 23, 2017.