By Eliseo M. Rio Jr.
(Former Department of Information and Communications Technology (DICT) acting chief Eliseo Rio has accused the agency of undertaking a P466.5-million internet connectivity project he described as “unnecessary” and “overpriced”. During House blue ribbon committee hearing held recently, Rio questioned the DICT for its planned establishment of the 1,035 very small aperture terminals (VSAT) in the Philippines, when a similar project, also of the department, is already ongoing.)
In its recent press release, DICT claims that the DICT VSAT is “20 times faster; five times cheaper than previous foreign contractors.” It is like saying that a plane is 20 times faster yet five times cheaper than a car, which people will immediately say is not true. But that is exactly what DICT wants people to believe by clouding the truth.
DICT Undersecretary Emmanuel Rey R. Caintic himself said, “the DICT-deployed Managed Internet Service-Very Small Aperture Technology (MIS VSAT), will provide a Maximum Internet Rate (MIR) of 25 megabits per seconds (Mbps) and a Committed Internet Rate (CIR) of 6 Mbps to geographically isolated and disadvantaged areas (GIDA).
In comparison, the United Nations Development Programme (UNDP)-deployed VSATs under the 2018 DICT-UNDP Pipol Konek project provides a MIR of only 2 Mbps and a CIR of 0.2 Mbps.”
Clearly, simple arithmetic shows that the MIS VSAT is only 12.5 faster than the DICT-UNDP VSAT. Therefore, the CIR of 6Mbps is very questionable. In VSAT applications, CIR is kept to its minimum because one pays a premium for having a guaranteed speed whether one uses it or not. To justify paying for a 6 Mbps CIR, each site must have at least three users watching Netflix or having a Zoom meeting 24/7 NONSTOP, plainly idiotic, and a waste of time and money. The government will be just throwing money for 6Mbps CIR when best practices keep VSAT CIR to only around 256Kbps for 24/7 VOIP and other network maintenance operations.
The MIS VSAT cost the government P466.6M for only 1,035 sites for a managed service of only five months. Again simple arithmetic will show that each site costs P90,000/month. While the DICT-UNDP VSAT cost the government P1.3B for 5,000 sites, all located in far-flung unserved areas, for a managed service of 12 months. This translates to only P19,200/site/month. How can DICT say with a straight face that the MIS VSAT is five times cheaper when in fact it is almost five times more expensive than the DICT-UNDP VSAT.
As Usec Caintic said, VSATs can only be cost-effective when used in geographically isolated and disadvantaged areas not reached by any commercial telcos/ISPs. Yet the Notice of Awards to the four VSAT providers that got the P466.6M contracts states explicitly that these VSATs will be used in Quarantine Centers and Medical Facilities involved in the Covid-19 response and recovery pursuant to RA 11494 where bidding can be waived. Almost all of these are located in urban areas, which are the centers of gravity of the pandemic where other telcos/ISPs have a presence. Again, DICT is wasting government funds because these commercial telcos/ISPs can give at least ten times cheaper the cost of the VSAT providers but are not even considered in the awarding because the selection is tailored fit to include only VSATs.
All these mumbo-jumbo explanations coming from DICT may confuse the ordinary laymen, but to the people in the ICT industry who are the constituents of DICT, these are veiled attempts to hide the facts that government funds were used without bidding to be awarded to only favored VSATs providers at very high costs when other telcos/ISPs can give better-managed services at a much cheaper cost at a much longer period. And comparing the MIS VSAT to the DICT-UNDP VSAT is a non-sequitur part of a smokescreen to hide the truth, for the latter are located in unserved areas where internet data usage is more important than internet speed, while the former are located in urban areas where there are other means to get internet access much more beneficial to the government.
Below are the documents that support the points the author raised:
