The Department of Information and Communications Technology (DICT) and the National Telecommunications Commission (NTC) have issued stricter financial and operational guidelines for the country’s third major telco player.
On Wednesday, June 27, the DICT published the latest draft of the terms of reference (TOR) for the selection of the new major player in the telecommunications industry in time for the public consultation to be held in the first week of July.
“This draft TOR, containing the rules and regulations on the selection of a new major player (NMP), is being released for the purpose of the public consultation that will be held next week and as part of its market study,” the DICT said on its website where it posted the latest draft of the TOR.
Veering away from the bidding process based on the participant’s investment and financial commitment, the DICT and the NTC listed three major criteria that the participant must meet in a commitment period of five years to be awarded the status of NMP.
As seen in the infographic, the third telco player must commit to cover a minimum of 30 percent of the national population each year, provide an average of five Mbps broadband speed, and allocate at least Php40 billion in capital and operational expenditures a year. By the end of the five-year period, the NMP must have a national population coverage of 50 percent.
The prospective NMPs will be scored correspondingly for each criteria and the one who gets the highest cumulative score will be selected as the third telco player.
Similarly, the qualifications for the third telco player have also changed.
Unlike the previous draft that explicitly stated that the participant must be 60 percent Filipino-owned corporation or consortium, the new draft only specified that a participant must be a “domestic” corporation. Still, a participant must have a congressional franchise, and the financial requirement of at least Php10 billion worth of paid capital also remained.
In terms of a participant’s technical capabilities, the new draft has defined more concretely that a participant must have experience in the provision, delivery and operations of telco services for the last five years.
The DICT’s publication of the TOR came well past the earlier deadline of May 2018 but came ahead of President Rodrigo Duterte’s State of the Nation Address (SONA) in July.
While the DICT has not officially named the companies that have been eyeing to become the country’s new telco player, several firms have been brought up in news reports. These include NOW Corp., Philippine Telegraph and Telephone Co. (PT&T), Converge ICT Solutions Inc., EasyCall Communications Philippines Inc. (ECP) and Transpacific Broadband Group International Inc. (TBGI).
In previous reports, DICT Officer-in-Charge Eliseo Rio said the government hopes to select the third telco player by the third quarter of the year.
Elyssa Christine Lopez is a staff writer of Entrepreneur PH. Follow her on Twitter @elsysalopz