Bitter rivals Globe, PLDT forge truce anew with IP peering deal

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Just a week after sealing a P69.1-billion deal to acquire the telecom assets of San Miguel Corporation, fierce competitors Globe Telecom and PLDT collaborated again to establish a long-awaited bilateral IP peering arrangement.

Top executives of Globe and PLDT are all smiles sealing the deal witnessed by Sen. Bam Aquino
Top executives of Globe and PLDT are all smiles sealing the deal witnessed by Sen. Bam Aquino

The IP peering deal is seen as the last piece of the puzzle that would enable the country to significantly improve its broadband and mobile internet speed. The agreement means that content and applications hosted by the PLDT group which are being accessed by Globe customers will be treated as local content, and do not have to be routed overseas

About 20% of internet traffic is local, which means that traffic originates in the Philippines and terminates in the Philippines. As provided for in the agreement, both Globe and PLDT will provide a 3Gbps per month free traffic threshold.

PLDT, the country?s dominant telecom provider, has been adamant in the past not to open up its network, citing security concerns. But as pressure from the private sector mounted and the incoming President Rodrigo Duterte promising to crack the whip, PLDT eventually agreed to connect to smaller rival Globe.

Independent ICT policy researcher Grace Mirandilla-Santos expressed surprise at the speedy collaboration between the two telecom players. “PLDT and Globe are doing today, in a span of just a few months, what they couldn’t or didn’t want to do over the past decade,” she commented in Facebook.

Globe chief technology and information officer Gil Genio said local internet quality and speed would surely get faster since two-thirds of its traffic usually goes to PLDT-controlled network.

?We also cannot call ourselves as real ISPs (internet service providers) if we don?t have IP peering. So, this is a milestone,? said Genio during a press briefing announcing the agreement in Makati.

Sen. Paolo Benigno ?Bam? Aquino, which pushed the interconnection between the two warring telcos, witnessed the signing of the memorandum of agreement.

“I am very happy that it’s finally happening after months of talks. We started looking into this option more than a year ago in the Senate,” said Aquino in his speech during the signing ceremony.

For its part, PLDT said the IP peering arrangement ?is in line with the company?s digital pivot.?

?We are focused on taking effective measures to improve internet services in the country. IP peering is one such measure. By keeping local traffic local, we improve the internet experience of both PLDT and Globe subscribers,? said Ernesto R. Alberto, PLDT executive vice president and head of enterprise.

PLDT said it is also working with global internet players like Google, Youtube, Facebook and Microsoft to store popular internet content in the Philippines so Filipinos can access this more quickly.

?Caching is needed because about 90% of internet content frequently accessed by Filipinos come from overseas. This is one reason why PLDT is building more data centers in different parts of the country,? said Ray C. Espinosa, PLDT head of legal and regulatory group.

With the peering arrangement, PLDT and Globe will now allow direct local exchange of traffic between PLDT?s Philippine Internet Exchange (PhIX) and Globe Internet Exchange (GIX) that is destined to each other?s own broadband and mobile customers.

?The intention here is to keep local traffic within the country which should lower latency due to less hops and thus, should result in marked improvements in fixed broadband and mobile internet services in the country,? Alberto noted.

The MOA paves the way for the initial phase of bilateral peering which is localized IP traffic exchange between the PLDT broadband and mobile subscribers and Globe subscribers, which should be completed 30 days after the execution of the MOA. It also dictates that the two telcos will work towards executing a fuller bilateral peering agreement within 90 days after the initial phase has been accepted.

Once implemented, the IP peering arrangement between the two telcos will keep a substantial portion of local data traffic in country, thus the elapsed transmission and reception time are kept to a minimum. This in turn allows for shorter access-to-response time, and faster access to applications.

IP Peering also helps minimize the country?s dependence on international cables and prevent a repeat of a 2008 incident where major international cables were damaged because of the Taiwan earthquake. The incident prevented Philippine customers from accessing local sites, government websites, and local emails.

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