The Need to Address Regulatory Capture in the Telco Industry

 "I laud the DICT for spearheading the effort to revolutionize Internet connectivity in the country"

Filipino consumers have been complaining about the quality of products and services being offered by the two telecommunications companies in the country- PLDT-Smart and Globe- for a long time now. The quality of Internet connectivity in the country is one of the slowest, and, to add insult to injury, also among the most expensive in the world that even Alibaba's Jack Ma, who was in Manila for a series of meetings and to receive an honorary degree, took notice of it. Aside from that, consumers long suffered from highly publicized call and text promos that often fail to live up to what is being advertised on various media platforms.

It is for this reason that President Duterte is considering a variety of ways to bring to the long suffering Filipino consumers telecommunications products and services that are at par with other countries in terms of good quality and reasonable pricing. He has signed a memorandum instructing government officials in charge of the economy and legal reforms to study the possibility of opening up the telecommunications industry to foreign companies. More recently, he, after meeting with Premier Le Keiqiang, announced that he is inviting Chinese telecommunications firms to set up shop in the Philippines to directly compete against PLDT-Smart and Globe.

The Department of Information and Communications Technology (DICT), along with the Bases Conversion and Development Authority (BCDA) and Facebook are joining forces to build international communications gateways linking the Philippines to the rest of Asia and the world that will also revolutionize Internet connectivity in the country, and enable the government to establish its own telecommunications links, especially in far-flung areas of the country, without relying on the existing infrastructure that is controlled by PLDT-Smart and Globe, and using expensive submarine cables between Batanes and Taiwan.

While I believe in the need to have four to five telecommunications companies competing against each other by offering a variety of products and services to consumers, and I laud the DICT for spearheading the effort to revolutionize Internet connectivity in the country upon the instructions of no less than President Duterte himself, the issue of regulatory capture must also be addressed.

What is the use of having four to five telecommunications companies in the Philippines if the government cannot enforce the rules and is being dictated upon by the companies? Based on what I am seeing, PLDT-Smart and Globe will not be able to force their will on consumers if the DICT, National Telecommunications Commission (NTC) and the Philippine Competition Commission (PCC) can assert themselves by implementing the rules as they are, and protecting the rights and interests of both consumers and the government. Aside from the DICT, NTC and PCC being able to do their work, Congress should also be able to resist the lobbying power of the telecommunications companies and penalizing the erring ones by revoking their license to operate in the country.

The quest to bringing the best Internet and telecommunications products and services to the Filipino goes beyond having more players in the industry. Ending regulatory capture is a prerequisite to ensure that the interests of consumers and of the government will be protected, and only the best possible and most reasonably priced products and services will be on offer. Having more telecommunications firms operating in the country, and the government being able to set and enforce the rules go hand-in-hand, and this is something that President Duterte can look into now that he is more than willing to go against big business to give Filipino consumers the best that they could get.


Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of TheLOBBYiST.
About the Author
Benedict is an agricultural economist, academician and writer. He has gained experience and expertise in various fields of economics, business, political science and public relations after through professional ventures in the academe, and in the public and private sectors. He has authored or co-authored key publications on topics ranging from agriculture and food security to global affairs and politics.
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