DICT sets consultation for entry of 3rd telco player

By Aerol John Pateña

July 2, 2018, 5:28 pm

MANILA -- The Department of Information and Communications Technology (DICT) announced that it will hold public consultations on its draft terms of reference (TOR) for the entry of a new telecommunications player on July 6, 2018.

In an advisory to media Monday, the DICT said that the consultations will be held on Friday morning at the Crowne Plaza Hotel Galleria in Ortigas Center, Quezon City.

“Two versions of draft Terms of Reference (ToR) published in the DICT website will be presented: (1) using the Highest Committed Level of Service (HCLOS) formula; and (2) using auction as mode of selecting the New Major Player. Output of this consultation shall be a significant contribution to the DICT and the Oversight Committee,” the DICT said.

The DICT has released last Thursday its proposed guidelines on the auction of frequency spectrums under a second set of draft guidelines for the selection of the third major telco player.

According to the guidelines, a bidder that will offer the highest annual capital and operating expenditure for a 5-year commitment period shall be selected as the new major telco player. The new telco player shall be subject to the applicable spectrum user fees pursuant to prevailing rules and regulations after the said period. Participants should have a minimum bid amount of PHP 36.58 billion.

The newer guideline is an alternative to the earlier terms of reference dated June 26, which used the Highest Committed Level of Service (HCLoS) as basis for the selection of a new telco player.

A third telco player should have an annual capital and operating expenditures worth PHP40 billion, must have coverage of at least 30 percent of the national population and a minimum average broadband speed of 5 Mbps according to the earlier guidelines.

The criteria for the selection were set as follows: 40 percent for national population coverage, 20 percent for minimum average broadband speed and 40 percent for annual capital and operating expenditure over a five year commitment period.

The latest draft of the guidelines was made in accordance with the preference of the Department of Finance (DOF) for an auction of the frequencies that will be assigned to a third telco player.

The DOF is a member of an oversight committee to assist the NTC in the formulation of the guidelines for the selection and assignment of radio frequencies for the entry of new telco player. The committee is composed of the DICT secretary as chairperson; Finance secretary as vice chairperson, Office of the Executive Secretary and the National Security Adviser.

The DICT has earlier expressed opposition to the auctioning of frequencies as this will force a new player to put up a huge amount to qualify for the bidding process, which is not related to the setting up telecommunication facilities and improvement of services.

Finance Secretary Carlos Dominguez III has said that a third telco player needs to have at least PHP 200 billion to compete with existing telco giants PLDT Inc. and Globe Telecom Inc. (PNA)