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Japan, Taiwan also keen on being 3rd PH telco player



By Argyll Cyrus Geudcos 

Two telecommunications companies from Japan and Taiwan are also interested in becoming the third telecoms provider in the country, the Department of Communications and Information Technology (DICT) revealed.

The announcement was made after Presidential Communications Operations Office (PCOO) Secretary Martin Andanar revealed that South Korean multinational conglomerate LG Corporation wants to be the third force in the local telecoms industry.



DICT Secretary Eliseo Rio said over Andanar’s program in Radyo Pilipinas that Japan’s second biggest telecommunications company KDDI Corporation expressed eagerness to enter the telecoms playing field.

“Ang interesado sa pag-invest sa atin din is iyong number two nila, iyong KDDI (KDDI is the one interested to invest in the Philippines), the second biggest telecommunication company. And well of course kailangan maghanap sila ng (they need to find a) Filipino partner,” Rio said.

“They are very much interested and in fact they are seeking help with the department to find, or to partner with a Filipino telco,” he added, noting that Japan’s largest telco, NTT, is already partnered with PLDT.

Rio also expressed that KDDI may also partner with the third telecommunications company which will be formed.

“Ang KDDI ay siguro iyon na ho ang pang fourth, na puwedeng pang fourth or puwede hong mag-partner sa isang nabuo na (KDDI can be the fourth interested company, or they can partner with the company formed),” he said.

KDDI Corporation is a Tokyo-based Japanese telecommunications company formed in October 2000 through a merger of three firms.

Rio also revealed that a Taiwanese telco is also interested but did not reveal further details.

“May mga nondisclosure sila, kaya ho hanggang hindi ho magpirmahan sila ay hindi na talaga dini-disclose (They have a nondisclosure so until they sign contracts, we can’t disclose the name of this firm),” he responded when asked by Andanar the name of the Taiwanese firm.

In a bid to end the ‘telecoms duopoly’ in the country initiated by Globe and PLDT, President Duterte has ordered the DICT and the National Telecommunications Commission (NTC) to swiftly approve applications and licenses to allow the third telecoms player to begin operations by March 2018.

It was revealed that in November 2017, Duterte had formally invited China to become the third telecommunications. Beijing has nominated state-run China Telecom but the company is yet to find a local partner with an existing franchise in order to comply with the country’s constitutional provision limiting foreign ownership to 40 percent.

Despite Duterte offering the third slot to China, Malacañang said the Philippines is not closing its doors to other countries who might be able to make a better offer.

“Kung sino ang pinakamagandang offer sa bidding, aba’y iyon ang mananalo. Hindi naman ito parang monopolya pagdating sa third player. Kailangan talaga it’s the best (Whichever has the best offer will win. It will not be a monopoly for the third player. It just really has to be the best),” Andanar had explained.

Months after the announcement of China Telecom’s interest in entering the telco industry, Andanar revealed Friday that LG Corporation is the South Korean conglomerate interested to become the third local telecoms player by partnering with Philippine Telegraph & Telephone Corp (PT&T).

How to pick one from four?

Rio explained that now that there are four companies from different countries vying for one slot in the Philippine telecoms sector, the DICT has now ordered the NTC to start defining the terms of preference.

“Doon ho nakasaad iyong terms of preference na iyon kung ano iyong mga frequencies na ibibigay namin sa mananalo, mga support and things like that (It is indicated in the terms of preference the frequencies that we will give the winning bidder),” Rio said.

He added that the terms of preference will be finalized by February 19, giving the local firms at least a month to come up with their organization, financial plans, and to identify their foreign partners.

“Then come to us maybe before the Holy week in sealed proposals—sort of a bidding process. Bubuksan ho isa-isa iyan (These will be opened one by one), present asset like whatever you are going to bid on your financial plan minus your liability,” Rio said.

“Arithmetic lang ho ang kailangang gawin dito (This is simple math). Your present asset plus your financial plan for five years, minus all your liabilities. kung sinong pinakamataas niyan siya hong mananalo po. (Whoever has the highest offer will win),” he added.

Rio explained that the financial clout of the foreign partner is their prime consideration so they will not end up selling their shares to existing telco players in the country.

He said that they will include in the contract that the winning bidder will not be allowed to sell their shares to existing telecommunications companies

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