New technology for faster Internet service

SINCE President Duterte called for  a third telecommunications firm  to help improve the country’s Internet services, many groups, local and foreign, have been mobilizing  their resources to bid for this all-important third  slot in  an industry that has become so important to the country’s economic development and progress.

But even  without  the third  major  telco, the firms already in the field have been  steadily  boosting their  services and drawing up  plans for faster Internet connectivity.  One such  tie-up was announced the other day between  power  utility giant Manila Electric Co. (Meralco) and Philippine Long Distance Telephone Co.  (PLDT) which plan  to deploy 5G next-generation technology.

It seems  Meralco’s poles  are ideal for the new technology. They are  lower and infinitely more numerous than  the giant towers now in use by the earlier 3G and 4G technologies.  The present  Internet  service providers – Globe and Smart – have long complained  about the difficulty of getting government  permits for their  towers. The government has even  proposed  that it will build the towers for common  use by the firms.

Meralco  has also been recently in the news   in a survey undertaken by the International Energy Consultants (IEC), an Australia-based firm specializing in Asian power markets. The survey found Meralco‘s  residential  rates  have gone down  8 percent  since 2012 and are now among  the cheapest  in Asia, except  that in many other countries,  the  government  provides  subsidies.

IEC Managing Director  Dr. John  Morris who led the study  said Meralco’s  tariff  has increased by  only 3 percent  “despite  the twin headwinds of significant  fuel  price increases and a depreciating  local currency.  Government  subsidies,  he noted, have played a big  role in other countries. If subsidized markets were excluded,  Meralco’s  tariff  would  be  one of the cheapest in Asia, he said.

Government subsidies today make power rates artificially low in Thailand, Indonesia, Malaysia, Korea, and  Taiwan, the IEC said. The subsidies in these  countries are in the form  of cash grants, subsidized fuel, and deferred expenditures; they lower the  tariffs by   41 percent. In view of the survey’s findings, our  government  might  consider  a  subsidy program, like those of the other nations, to bring down power  costs for Philippine households.

But  government, with  all its present  problems, is  not expected to do any subsidizing at this  time, so  private industry will have to carry on  without  government help. The plan of  Meralco  and  PLDT to tie up to roll out 5G networks  will  be  a major step forward. Without any substantial government  help  and  using  Meralco’s  already established  resources – its  thousands of electric  powerline  poles – its partnership  with PLDT  and their introduction of new  5G  technology  is expected to provide  faster Intern et   speed  and more  reliable  connections around the country and with the rest of the globe by the year 2020.