Group says conditions ripe for picking new telco player, initiating reforms

Advocacy group Better Broadband Alliance (BBA) said the conditions are ripe for initiating the entry of a new telco into the market.

Photo credit: ITU.int

In a letter sent to Department of Information and Communications Technology (DICT) acting secretary Eliseo M. Rio Jr., the BBA said there is sufficient impetus behind the ongoing reforms proposed by government to ensure that the policy and regulatory framework will be welcoming for a third telco.

The group said with the return of the CURE frequencies and 10 MHz of Liberty Telecom’s 700 MHz, plus other available frequencies, a new entrant will have enough spectrum to get started.

“While the 3G frequencies in litigation with the Supreme Court would be a plus for an NMP (new major player), any new entrant should also be willing to consider using other emerging technologies, such as 4G/LTE and 5G, for which there are frequencies already available or which the NTC can make readily available by refarming or recall — functions that are within the existing powers of the NTC,” the BBA said.

The BBA also noted the DICT has previously announced on several occasions its plans for spectrum management reform.

“Such reforms towards more equitable assignment of spectrum, which would naturally take time, can start even while the competitive selection process is ongoing,” it said.

The group said that while having access to common towers could be desirable, it “should not and would not be made a dependency by an NMP who comes in as a challenger to the existing networks who own the towers.”

“At any rate, bringing in the new player early allows it to already start building a core radio network and basic infrastructure, which in any event would be a pre-requisite to participating in any common tower arrangement with existing telcos. Information about the NMP’s network and network coverage designs would also help the common tower company, if and when the NMP decides to utilize these common towers,” it added.

The BBA also said complementary to common towers, the government should work on the ease of applying for right of way and permits when rolling out a network.

Congress has passed into law R.A. 11032 or the Ease of Doing Business Act, which “reduces the processing time for government agencies and government-owned and controlled corporations to three working days for simple transactions, seven days for complex transactions, and 20 working days for highly technical transactions.”

“This policy should address the need to expedite and streamline government permits, which the incumbent telcos have long been clamoring for,” the group said. “We believe that the government is in the best position to resolve the use of the power transmission dark fiber immediately, without delay.”

However, the group said the new player should also seek alternatives. “It is good to know that the NGCP and TransCo have reportedly agreed to sign an agreement between them that will advance the national broadband plan,” it noted.

But the BBA said the selection of a third telco or the implementation of a national broadband plan should not depend solely on this agreement.

“Access to the NGCP dark fiber would be a major plus for the third player’s backbone. However, even without this, the prospective NMP may build its own fiber links, partner in a consortium with a party that already has some infrastructure in place, and there are alternatives for a backbone, such as satellite,” it said.

The group said regulatory reform of interconnection rates has been a long-pending consumer issue, as they affect subscriber rates. The NTC is in a position to mandate this quickly, especially now with the directive that DICT recently issued, according to BBA.

“The NTC is slated to conduct a public hearing on June 13, and hopefully the issuance will be out by the time the NMP is selected. This reform, however, is more relevant to the actual operation rather than the entry of a new player,” it said.

“Any new player should be required to design and dimension its own network considering that it will have to use its own resources and not rely on government-backed infrastructure.”

The substantial paid­up capital requirement being espoused by the government assumes that that capital will be expended towards building a substantial network, it added.

“We believe that any new player who comes in must first, be willing to work with existing, available spectrum and use new technologies to their fullest, and second, be flexible and versatile enough to consider that, as a challenger to two dominant and well-entrenched players, it will likely not have a free ride on existing infrastructure,” it said.

The group said initiating the selection process at the earliest possible time will allow the NMP to adapt to the environment sooner, even as the government works towards resolving long-outstanding issues on spectrum and infrastructure.

“Starting the process now also allows the regulators to better assess the ability of the potential new players to bring innovative solutions into play that will bring better service with wider coverage at the lowest possible cost to the consumer.”

It added: “The government gains nothing by waiting while these issues on spectrum and infrastructure work themselves out. It stands to gain everything by getting the ball rolling and having potential players officially declare their intentions, submit their proposals, as well as bring forth their issues with the resources they will be given to work with.”

“In short, the selection process can be carried out while the government works on key policy and regulatory reforms. BBA, thus, urges the government to immediately release the TOR (terms of reference) as the first step that will begin what is bound to be a long journey towards the selection and actual operation of a competent new telecom player.”

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