Congress eyes revoking 3G licenses!
In another uncalled for move by our House of Representatives, there is a House Resolution (HR 190) and a House Bill (HB 1108) looking into the possibility of having our National Telecommunications Commission (NTC) revoke the 3G frequencies currently assigned to local mobile network operators: Smart, Globe, Digitel and CURE. I cannot find an online link in today’s (December 23 2006) issue of the Inquirer.Net (I read it on the print version). However, here is a GMA New.tv link instead.
“House Resolution 190 and kindred resolutions are just what we need to scare and drive away investors. House Resolution 190 is a prescription for disaster, just what the Philippines needs like a bullet hole in the head,” Globe declared in its position paper.
Aside from 190, two other resolutions on the awarding process of 3G franchises have been filed in Congress.
There was House Resolution 1108 filed by Rep. Danilo E. Suarez which urged the NTC to nullify contracts awarded to 3G networks and instead conduct an open bidding.
A second proposal, HR 01105, was filed by Rep. Alan Peter Cayetano. In it, he called for an investigation on the losses the government might have incurred through the 3G license awarding process.
“If an auction had pushed through, supposing already that applicants were willing to bet on an already exorbitant and unrealistic tripling of the minimum bid at P1.2 million for each band, then total proceeds could only run to P6.5 billion. Then the P15 to P25 billion windfall suggested by some members of Congress in several fora and memoranda is purely speculative and without solid substantiation,” the company said.
Congress came out with this resolution to recover P15 billion-P25 billion it says the government lost when the NTC awarded the 3G licenses instead of bidding them out.
In this case, I agree with Globe that the basis for the P15-25 billion in forgone government revenues are greatly exagerated figures. There are numerous differences with the Philippine situation and the European situation. First, there are enough frequency slots to accomate all the players requiring 3G spectrum. Second, the European figures where brought by the 3G hype at those times. Thus, the frequency prices where bloated based on unconfirmed market demand. Third, some companies in Europe were not able to capitalize on the licenses and forced to return frequencies due to loss of working capital due to high 3G frequency license fees. Fourth, the government is collecting yearly fees anyway. Isn’t yearly fees better? Besides, in the end, operators will be forced to pass the cost back to the customer or not roll-out 3G services at all.
Right now, I particular like the current 3G offerings of both Globe and Smart as they are decently priced (different business models). I hope both operators can spend more money inproving services to customers instead of having to pay for license fees. Besides, the government will benefit from the increase in 3G usage in the form of taxes anyway.
December 24th, 2006 at 6:47 am
[…] This is totally ridiculous. All four 3G licenses granted to Smart, Globe, Sun Cellular and CURE is threatened to be revoked by a new bill passed in the House of Representatives. William Yu has the scoop: “House Resolution 190 and kindred resolutions are just what we need to scare and drive away investors. House Resolution 190 is a prescription for disaster, just what the Philippines needs like a bullet hole in the head,” Globe declared in its position paper. […]
December 24th, 2006 at 8:32 am
well, thnx to bidding losers, this is happening.
December 24th, 2006 at 9:30 am
oh well that is life. why don’t the loosers just use CDMA2000 with their existing PCS frequencies and not disturb the rest? heck, CDMA2000 is a competing technology to WCDMA but is also 3G. i know one who went this route.