Globe: Follow Duterte's lead in curbing PLDT's monopoly

Saturday, June 11, 2011

THE legal counsel of a telecommunications company urged other provinces and municipalities to follow the lead of Davao City Vice Mayor Rodrigo Duterte in curbing the monopoly of another rival company.

Globe Telecom legal counsel Rodolfo Salalima urged members of the Mindanao media to call on their House Representatives, mayors and heads of local government to put a stop to the indisputable monopoly of Philippine Long Distance Telephone (PLDT) Company that refuses interconnection in at least 31 areas all over the country.

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"It took a Duterte to force PLDT for interconnectivity here. Sana may Duterte din sa probinsya n'yo," he said during the press conference Friday at Buffet Palace.

The interconnectivity agreement between Globe and PLDT in July 2010 allows Davao City subscribers to make calls at either telecommunication lines without long distance charges.

The agreement, raised before the National Telecommunications Commission (NTC) and the Davao City Council, took two years to materialize.

Aside from Davao City, Globe has limited interconnection with PLDT in NCR, Cavite, Capiz, Maguindanao, Batangas, Cebu, Negros Occidental, Bohol and Leyte.

Consumers in 31 areas where PLDT refuses interconnection have choice but to pay undue national long distance rates.

"Twenty-one years ago, PLDT is still answering the same smug and arrogant response: ako ang nagtanim, ako ang nag-ani, ako ang nagluto at ngayon iba ang kakain (I planted it, I harvested it, I cooked it and now another person will eat it)," Salalima said.

Globe has filed a motion to intervene before the NTC on the controversial merger between PLDT and Digitel Telecommunications.

Monopoly still a problem

After more than 20 years when the Supreme Court ruled that interconnection is a legal intervention of the State, monopoly remains to be a problem, Salalima added.

At recent hearings conducted by the Senate committee on public services, data given by NTC shows PLDT-Digitel has majority 51 percent share of 3G and cellular mobile telecommunications systems frequencies, while Globe has a mere 23 percent share.

"The main reason why Globe opposes the merger is because it does not level the playing field. The consolidation of the two companies is anti-competition in as much as they will be accumulating all the frequencies," he said.

As of present, Globe is assigned a total of 99 units compared to the total of 372 units of the combined merger of PLDT and Digitel.

"Monopoly kills the rival. And PLDT has been incising their dominion influence in the market," he said.

Bayan Muna party-list Representative Teddy Casiño, in his privilege speech at House of Representatives Monday said PLDT-Digitel's overwhelming 71 percent share is a telco behemoth that will monopolize the market.

"This abhorrence of monopolies is enshrined in the Constitution. Section 19, Article 12 of the 1987 Constitution states that 'The State shall regulate or prohibit monopolies when the public interest so requires. No combinations in restraint of trade or unfair competition shall be allowed'," Casiño said.

The international telecommunications body allocates frequencies globally and the local regulatory body allocates these to different telecommunication companies.

Globe is allocated one block and with the merger, PLDT-Digitel will own five blocks.

Level playing field

"We are urging the government to level it out and that they divest their other frequencies," Salalima said.

The consolidation of PLDT and Digitel will result in a lopsided imbalance of spectrum allocation in their favor, according to a press statement.

Globe serves 27.3 million subscribers with only 99 megahertz while Smart and Sun will effectively serve 60 million subscribers with 372 megahertz.

"An informed choice is good for the consumers. We are holding this briefing to inform the public," Salalima said.

Salalima warned that if the government allows the PLDT-Digitel deal to go through without correcting its frequency allocation, then this deal violates the NTC memorandum Circular No. 07-08-2005 (Rules and Regulations on the Allocation and Assignment of 3G Radio Frequency Bands that states, "Entities with more than 50% of common stocks owned by the same person or group of persons shall be considered as associated applicants, at the time of the application, and such entities shall be allowed to elect one of them to proceed in the filing of application for 3G services and 3G radio spectrum before the Commission."

Meanwhile, Globe corporate communications head Yoly Crisanto said they are bringing the issue to different key provincial cities in the country as the merger affects all stakeholders and not just Globe subscribers.

"Ang deal ng dalawang kumpanya ay makakatulong ba talaga sa taong bayan. We are not sourgraping and we are ready to compete but the government must level the playing field," she said.

Salalima said competition is healthy. "Kung walang karibal, hindi gaganda ang serbisyo at tataas ang rates," he added. "However, in a market of competition, we need more anti-monopoly laws."