PLDT Inc., the largest telecommunications and digital services company in the Philippines, has agreed to relinquish to the Philippine government “at no cost” one of its radio frequencies that will soon be offered to a potential third telecom player.
The Presidential Spokesperson Harry Roque on Tuesday, February 6, said that President Rodrigo Roa Duterte was vexed that the Philippine government would have to find additional frequencies to be awarded to the new upcoming telecom and Internet Service Provider.
PLDT Chairman, President and Chief Executive Officer Manuel “Manny” V. Pangilinan earlier said that P3 billion pesos would be a “good price” for possible compensation by the third telco player for the 3G frequency turned over by PLDT unit Connectivity Unlimited Resources Enterprise (CURE) to the government.
In a Facebook post on Wednesday, February 7, the Department of Information and Communications Technology (DICT) Officer-in-Charge Eliseo Rio Jr. said that MR. Pangilinan has agreed to return CURE frequencies to the government without any cost.
“After talking with MVP yesterday, PLDT will surrender the CURE 3G frequencies at absolutely no cost, that can now be given to the third major telco company, as per instruction of Duterte,” Rio said.
In a speech on Tuesday, President Duterte threatened to send Bureau of Internal Revenue (BIR) tax auditors to telecom firms that he said have a lot of “demands.”
Duopoly PLDT Inc. and Globe Telecom Inc. are holding the majority of radio frequencies, which these companies acquired from their purchase of San Miguel Corp.’s telco assets back in 2016.
While PLDT has surrendered its rights to a “cost recovery” provision in agreeing to return the spectrum frequencies assigned to CURE, earlier agreements with the Philippines government indicated that such reimbursement should be paid.
According to the NTC Case No 2011-072, PLDT was supposed to get compensation for its investment in CURE.
“The PLDT Group, as a minimum, shall be entitled to fully recover the reasonable costs of its investment in CURE (the ‘Cost Recovery Amount’),” the 2011 NTC decision read.
Earlier, the National Telecommunication Commission (NTC) said the 3G frequency returned by CURE would be part of the spectrum to be assigned to a new major telecom player.
The new wireless carrier that will invest for the first five years in the country is targeted to be established and running by the first quarter of 2018.
The Philippine Competition Commission estimates that only 12.8 percent of the spectrum will be available for the potential third player.
Under the DICT’s Memorandum Order No. 001, tech firms eyeing for the third telecom slot must have a valid congressional telecommunications franchise from the House of Congress, and must have a written and binding commitment from a foreign joint venture company, should applicable.
Applicants for the third telco slot must also not be an affiliate of Globe Group or PLDT Group of companies.