NEDA: Open Access bill to boost internet connectivity at lower costs

The passing of the Open Access in Data Transmission bill will allow for more affordable and better quality internet connection, the National Economic and Development Authority said Friday, March 15.

Speaking on the sidelines of the forum “The Future of the Philippine Connectivity,” NEDA Secretary Arsenio M. Balisacan stated that the bill will permit competition among service providers, which will diversify the options for Filipinos.

“That's the intention [of the bill]. Bababa yung presyo, mag-i-improve yung quality. There will be more service providers. Makakapagpili ka kung sino yung magpag-provide ng better service,” Balisacan told reporters.

[That's the intention of the bill. The prices will go down, the quality will improve. There will be more service providers. You can choose who will provide better service.]

The bill, which was already passed by the lower house and is currently being discussed in the Senate, will remove the legislative franchise requirement for telecommunication firms to gain access to spectrum resources.

It will also allow public telecommunication entities (PTEs) and non-PTEs equal opportunity to invest in broadband structure and then provide access to countryside where big telcos do not reach households.

The country currently has a broadband market of a duopoly with two large telcos– Globe and PLDT/Smart which own the international connectivity, backbone, middle- and last-mile networks and have the majority subscriber share.

Least invested in ASEAN

Among all ASEAN member countries, the Philippines is the most concentrated and profitable with these two operators dominating with 90+ percent of mobile market share and earnings, but has the lowest investments in terms of satellites, according to a policy note from the World Bank.

The policy note titled “Better Internet for all Filipinos: Reforms Promoting Competition and Increasing Investment for Broadband Infrastructure,” reported that investments on broadband structures slowed down from $2.2 billion or 0.64 percent of gross domestic product (GDP) in 2018 to to $1.8 billion or 0.44 percent of GDP in 2022.

The document also cited the country as the least favorable on policy environment for affordable broadband among neighbor countries as per Affordability Driver Index (ADI).

“Among 57 developing countries assessed in the ADI policy score from 2017 to 2021, the average score of the 5 policy areas assessed27 (national broadband policy, competition, infrastructure sharing, spectrum policy, and universal access) declined in the Philippines and improved in 40 countries,” the policy note reads.

Even with the removal of foreign ownership restriction and introduction of competition law, the broadband sector still did not significantly alter the market dynamics as it is rooted in commonwealth-era Radio Control Law and Public Telecommunications Policy Act enacted in 1995.

The Radio Control Law is the primary policy that governs the spectrum management (internet connectivity) in the country.

It limits the access of licensed radio frequencies to entities with a legislative franchise from Congress and the construction of a radio station to those with a permit from an executive authority.

Balisacan has been pushing for an amendment to the law that would clarify the responsibilities of the National Telecommunications Commission concerning spectrum; creation of the National Radio Frequency Plan, and a new licensing regime.

To date, there are still no updates regarding the legislative push, but Balisacan hopes that “there's something concrete that will come out of this forum today.”

According to the World Bank, connectivity reform and telecoms infrastructure can accelerate GDP annual growth by one percent.