Third Telco entry to the Philippines

in philippines •  6 years ago 

COLFinancial.com issued the following interesting news about the entry of third telco player:

"In the latest terms of reference (TOR) which was released in June 26, the government reduced the minimum requirements
for potential bidders of the third telco license, improving the winner’s ability to operate profitably in a shorter amount of time. Recall that previously, the government had very strict requirements for any potential bidder, insisting that the potential third telco player would need to have a performance bond issued by the government of around Php40Bil. The government also required a minimum coverage of 80% of the population, and a minimum speed of 16 Mbps by their 5th year.

However, in the latest TOR, the minimum capex requirement was set a Php40Bil per annum while the minimum coverage of the population was cut to 30% for the first year and 50% by their 5th year. The minimum speed was also reduced to 5 Mbps."

With the reduction of the minimum requirements to compete with the entrenched duopoly of Globe and PLDT, the third telco player theoretically can come in and compete better. However, this also seems to stack the deck against having a truly competitive fast internet product being released.

With the Pinoy culture penchant for "puwede na yan!" (That's okay!), this may mean we're not going to get any of the trail-blazingly fast telco service we've been expecting from a third player. The government, meanwhile, assures us that that won't be the case, as the bidders who promise more than the minimum would naturally get more points in the bidding for the license.

We'll see...

Full disclosure: I work for a subsidiary of one of the telcos but I'm not privy to any of the new developments on this end any more. I read the report more with the eyes of a consumer expecting faster internet and better service.

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