3rd telco needs 2G to compete with PLDT, Globe

Posted on by Karlo Thumos in SMS Industry

Johannes Benjamin R. Bernabe, commissioner of PCC, says in order to be competitive and offer the best 2G service to customers, they’ll need a certain amount of bandwidth range from 2G frequency.

Bernabe talked about how somebelieve 2G isn’t that important since smartphones have access to 4G and 5G frequencies, but currently 40% of the Filipino market uses non-smartphones, which is a large demographic to cater to. This would allow a third player to offer services to those users.

However, the Department of Information and Communications Technology (DICT) believes a third player should be able to compete with both Globe Telecom, Inc. and PLDT, Inc. with just the 300 MHz currently available.

(Photo by Tony Stoddard via Unsplash)

It’s important to note that Globe has earned 41% from voice and SMS in the past year while PLDT has earned 34% from SMS in 2016. A third telco player would need every advantage possible to compete against those numbers.

Right now, the NTC lists PLDT as controlling 30.32% of the frequency, while Globe accounts for 24.9%. Nearly 45% is either unallocated, unassigned or stuck in litigation cases. However, Bayan Telecommunications, Inc. is currently in the middle of a court case and if they lose, their frequency percentage may be available to the third telco.

This doesn’t guarantee any long term solution, though. For a more competitive environment, Senate Bill 1742 seeks a better process for allocating frequency among providers. Competitive bidding would allow telco providers to buy blocks of frequency to use. In the past, the NTC chose proposals that seemed the most beneficial when assigning frequencies.

To make it more attractive for a third telco player, the DICT is more lenient at the moment, especially since the funding required to start takes most players out of the running. Outside of financials, a third player needs at least a five year track record, no uncontested liabilities and no relationship with Globe or PLDT.

Currently, the DICT doesn’t plan to choose a third telco player until late August. Frequency assignments, interconnection rates and a new tower policy all still need to be decided as well.

Any third telecommunications player will need more 2G frequency access if it has any chance of properly serving the market, according to the Philippine Competition Commission (PCC).

[Sources: PLDT Annual Report and Globe Annual Report]

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1 Comment on 3rd telco needs 2G to compete with PLDT, Globe

  1. Rico Gacusan- Telecom expert November 5, 2018 at 7:34 am

    Well its so funny to know new player can use 2G technology to compete? Ha ha ha its 5Generation now and must go to this so they will compete globally. Why don’t invite T-Mobile to be one so it will do the job its the UN carrier for masses.