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Thursday, March 3, 2016

Telcos Challenge Government to Help Improve Broadband Service

Wazzup Pilipinas!

The recent Broadband Policy study released by USAID and the Foreign Chambers of Commerce said that tower sharing could be a solution to increase broadband speed and make it more affordable. The telco industry has indicated that even with tower sharing, this will not help address the issue of speed and affordability since the cell site towers of both telcos are similarly located.

“What we need is to increase cell site density by building more cell sites,” said Globe General Counsel Froilan Castelo. Based on the study made by TowerXchange in February 2016, the number of unique physical cell sites in the Philippines is one of the lowest in Asia with a combined 15,000 cell sites. China has the highest number with 1.18 million cell sites, followed by India with 450,000, Indonesia with 76,477 cell sites while Vietnam has 55,000, Thailand with 52,483, Pakistan with 28,000, Bangladesh with 27,000 and Malaysia with 22,000 sites.

The Philippines ranks between Malaysia and Cambodia with 15,000 physical cell sites.

The Philippines with 15,000 cell sites is only higher than Cambodia and Australia, both with 9,000, Myanmar with 7,620 and Sri Lanka with 7,000. By comparison, the United States has a total of 205,000 cell towers in place.

Castelo said that mobile data explosion amid growing access to internet connectivity, requires more bandwidth than traditional voice and text messaging services. Thus, it demands the establishment of more cell sites for telecommunication operators to deliver mobile data services especially indoors.
As smartphones continue to evolve into all-encompassing wireless personal computers, telecommunication operators need to construct additional cell sites to enable their respective networks to transmit enormous amount of data. Cell sites transmit radio frequency signals that enable voice and data services in a given geographic area, simultaneously supporting multiple handsets, operating in different frequencies and maintaining customer connectivity even while they are in transit.

“The continuing clamor for better broadband service quality and experience has to do with the issue of congestion. Despite various capability upgrades and network modernization using the latest technologies, the disproportionate number of cell sites vis a vis traffic in the advent of a digital revolution cancels out the gains of any state-of-the-art network. We have to start facing the reality that more and more Filipinos especially the millennials are joining the digital bandwagon. Using any smartphone, the Internet in the hands of an individual enriches one’s lifestyle. In so doing, the country’s existing Internet infrastructure needs to catch up with the demand for data whether on mobile or at home.” Castelo said.

The Philippines by itself posing a challenge to connectivity because it is archipelago, with a population of 102 million in 42,000 barangays has to have a greater number of cell sites to cover existing usage. “Today we already need around 60,000 to 65,000 in a three-player market for telco companies to provide a more pervasive reach and better Internet speeds. In the next couple of years, smartphone penetration will go even higher and we will need to fill that gap as well,” he said.

Castelo emphasized that the prohibitive permitting environment, site acquisition and Right of Way issues have kept telecommunication operators, including Globe, from aggressively rolling out broadband infrastructure to boost Internet speeds in the country. Globe alone has more than 500 cell sites waiting to be built at any given time.

“A lot of the infrastructure backlogs in the telecommunications industry could be attributed to challenges in getting LGU permits. This is why Globe has been calling on the government to provide policy support for initiatives to improve Internet infrastructure in the country,” he said.

Specifically, prioritizing an Open Access Law for the telco industry would expedite the issuance of all the relevant permits for all telecommunications facilities at the local government level. Such legislation is also seen to mitigate bureaucratic red tape and other political hurdles that stand in the way in the deployment of telecommunication and broadband infrastructure, Castelo said.

He emphasized that telecommunication companies are required to secure at least 25 permits, a few of which were also mentioned in the Broadband Policy paper which causes delay in the deployment of internet infrastructure such as cell sites, and fiber builds, among others. According to Castelo, securing different permits at the LGU level could become very challenging, from the sheer number of permits to the different political personalities that mobile operators have to deal with.

Castelo emphasized that permit or regulatory fees imposed by various local government units should cover only the reasonable costs of regulation. Prior to enactment of any pertinent ordinance, local government units should be mandated to present an itemized proof of said regulatory costs. A public hearing involving telecommunications companies and other stakeholders within their jurisdictions should also be conducted prior to the enactment of any local ordinance. Also, when these costs are requested in writing, a local government unit should be able respond with the requested information in writing.

Castelo also said that if only the government can prioritize telco infrastructure builds, not only will majority of consumers benefit because of better Internet speed and better service quality but it will also connect other important areas to the Internet in a scale that has not been done before like public health centers and public schools. This will address a lot of issues especially in the delivery of basic social services, disaster response and education at the barangay level.

Aside from pushing for the Open Access Law, Globe is also advocating for the immediate harmonization and equitable distribution of the 700 megahertz of frequency to sufficiently provide for rapidly increasing data traffic amid growing smartphone use in the country. He emphasized that the use of the 700 MHz will help improve internet speed in the country.

Based on data gathered by the GSMA, only the Philippines and Thailand are the two remaining countries in the Asia Pacific with major issues that have prevented allocation of the 700 MHz band to mobile broadband technologies.

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