By Ellson Quismorio
Makati City 2nd district Rep. Luis Campos Jr. has expressed great optimism over the impending entry of a third telecommunications company in the country, going as far to say that it would bump up the current Internet connection speed to 25 Megabits per second (Mbps).
All that in just 18 months, said Campos.
“Competition can create wonders. We should soon be where South Korea is now in terms of average mobile Internet connection speed, with the Mislatel consortium in play,” said Campos, a deputy minority leader.
According to the congressman, the two dominant telecommunications players – PLDT Inc. and Globe Telecom Inc. – would be driven to deliver faster connections to aggressively defend their market shares even before Mislatel actually starts offering its own Internet services.
“We reckon that PLDT and Globe may each have to spend up to P65 billion every year starting 2019 to stay ahead and quickly build up their capacities to supply superior Internet connections,” he said.
“To include Mislatel’s pledge to invest at least P50 billion yearly to put up its own network, we are thus easily looking at up to P180 billion in combined annual capital spending from the three players to advance the nation’s telecommunications infrastructure,” Campos said.
In a research note, online stockbroker COL Financial Group Inc. said the Mislatel consortium “has the financial muscle to execute its plan and will most likely engage in a price war (with PLDT and Globe) to grab market share.”
“Deep pockets” would enable Mislatel “to operate at a loss for a long period,” COL said, adding that the consortium’s foreign partner, China Telecom Corp., “generated the equivalent of P146 billion in profits in 2017.”
“Once Mislatel starts offering its services in Metro Manila, consumers could end up shifting subscriptions every now and then, depending on which of the three players provides the best Internet connection in terms of speed and price,” the Minority bloc official said.
The current average Internet speed in the Philippines is a rather paltry 5 Mbps.
Mislatel has committed to invest an aggregate of P257 billion between 2019 and 2023, and to deliver a minimum average Internet connection speed of 27 Mbps in its first year of operation and 55 Mbps by the fifth year.
The consortium expects to provide network coverage to 84 percent of the population by the fifth year.
Campos has been batting for the reclassification of Internet access as a “basic telecommunications service” so that regulators may compel suppliers to provide rising connection speeds under pain of severe punitive fines.
Under House Bill (HB) No. 5337, Campos wants the National Telecommunications (NTC) empowered to regulate both the quality and the cost of Internet access by tagging it a basic service.
At present, the 23-year-old Philippine Public Telecommunications Policy Law treats Internet access as a “value-added service” rather than a basic service. Thus, suppliers are relatively free to provide the service on their own terms.