FROM being a luxury to becoming a right, access to the Internet has transformed into a very essential need for many Filipinos during the pandemic.
It has become so critical that the Internet has often been described as the new oxygen—no longer just gold or oil—for both individuals and businesses to stay, almost literally, alive.
There is no exaggeration here—just check the panicked calls made by Internet subscribers to their telcos each time their online work or study is disrupted. It is, literally, a life-or-death matter, as government and health experts have deemed work-from-home arrangements the first important barrier to catching Covid-19. At the start of the pandemic, one writer whose Internet subscription was disrupted told her telco, “I’ve been forced to go out and work elsewhere, and risk getting Covid. Can I lay this at your doorstep if I get sick?”
And, in the same way that oxygen has become scarce due to the increasing demand for it, you’ll be surprised to know that access to the Internet is likewise still limited.
As National Telecommunications Commission (NTC) Deputy Commissioner Edgardo V. Cabarios put it so well: “Blood carries oxygen throughout the body, and you have to reach all parts of the body to deliver oxygen. Otherwise you will die. In the same vein, data connectivity is the new oxygen, but you have to reach the entire country to really thrive, and, in some cases, for you to live.”
Due to the pandemic, majority of Filipinos are required to stay at home, working and studying remotely via digital solutions to be safe from Covid-19. This paved the way for the acceleration of digital transformation for many industries and the creation of various hybrid business and learning models.
10 million is still too many
While the Philippines has a 4G penetration rate of roughly 90 percent, Cabarios admitted that Internet access has yet to be fully democratized.
“Not all areas in the Philippines have connection to the Internet. Telcos don’t build their infrastructure in far-flung areas because it’s very expensive to extend lines and there are no commercial returns,” he said.
Even the 4G penetration rate, he said, could be misleading.
“Ninety percent of the towns have access to 4G, but not the entirety of the barangays has service—some are just in the poblacions. There are many areas that need to be served, and that’s around 10 percent of the population. If you think about it, 10 percent is still big—that’s still 10 million Filipinos who do not have access to the Internet,” Cabarios said.
Even fixed broadband is still far behind the access race.
According to the latest Department of Information and Communications Technology’s (DICT) National ICT Household Survey, only three out of 10 barangays have fiber connections.
The limited access to the Internet results in inequalities: Filipinos without Internet access are being left behind of the benefits of the Web, especially in education, information and finance, among many others.
Telecommunications companies are pitching in to help bridge the digital divide, especially now that the Internet has been touted as a lifeline for many.
“Globe recognizes how crucial reliable connectivity is during this ongoing pandemic. Internet connectivity has been touted as the great equalizer. This is why through Globe’s robust network improvements nationwide and connectivity solutions made more affordable for every Filipino, we’re able to reach more homes across the country and enable them with means to pivot their businesses to digital, and continue operations despite the challenges,” Globe Telecom Inc. Spokesperson Yolanda C. Crisanto said.
Globe is spending roughly P76 billion to further modernize its mobile and fixed line networks. Bulk of the capital or about 91 percent will be invested in data-related requirements “to support the fast-growing data usage and provide superior data customer experience.”
PLDT Inc. and subsidiary Smart Communications Inc. has also allotted a total of P92 billion to expand their footprint for both wireless and broadband.
“The quality of our network and our superior customer experience continue to strengthen our revenue growth as our individual business continues to address the data requirements and digital lifestyle of Filipinos. Our Home segment continues to tap into the large unserved demand for home broadband, and our corporate digital transformation initiatives and data center business support our Enterprise segment’s growth,” PLDT Chairman Manuel V. Pangilinan said.
Third telco licensee Dito Telecommunity Corp., meanwhile, has programmed over P50 billion in capital expenditures to further expand its network and meet the commitments to the government.
Converge ICT Solutions Inc. has also set a P20-billion capital expenditures plan for 2021, as it embarks on widening its reach to more areas in the Philippines this year.
“Our mission to reach the underserved and unserved areas in the country became even more critical,” Converge CEO Dennis Anthony H. Uy said.
But these investments are not enough.
Gov’t should step in
Historically, Cabarios said, local telcos have spent almost P500 billion to build a network that could achieve average speeds of 33 Mbps for mobile and 77 Mbps for fixed line, “and still 10 percent is unreached for mobile and about 30 percent to 40 percent have no access for fixed.”
“The demand for Internet connectivity continues to rise day after day, and as we increase demand, we have to also increase the supply,” he said.
This is where the government should step in, Cabarios said. Missionary areas, or locations that are unprofitable for commercial broadband or mobile data, should be prioritized by the government.
“Telcos won’t put up infrastructure in areas that have no economic return on their side. So government should really invest in ICT infrastructure in order to reach those who are unreached,” he explained.
Cabarios noted that the DICT is right on track when it comes to providing Internet access to far-flung areas.
“We’re expecting that in the coming months and few years, with government investment doubling—even tripling—we can provide access to those without access and let the private investments compete in areas that they can compete,” he said.
He cited initiatives such as the National Broadband Network, the Free WiFi Program, and the Common Passive Infrastructure initiatives as examples.
“The whole country—both the private sector and the government—should have to invest a huge amount of money to satisfy the need for high-speed data connection, which is not cheap,” Cabarios said.
Still, the government has yet to fully “appreciate” the impact of the Internet in the lives of Filipinos, especially during the pandemic.
The DICT has proposed a P34.63-billion budget for 2022. The Senate recently approved this.
“We have observed that the entire ecosystem is limited in the appreciation for ICT-driven connectivity that will allow us to manage effectively and proactively. The government has yet to fully understand that ICT is the future, especially during the pandemic,” ICT Secretary Gregorio B. Honasan III said.
Cabarios added that the government ought to invest in ICT infrastructure as this can help boost economic activities, citing a World Bank study.
“The government should invest because it has economic returns. A study conducted by the World Bank showed that in developing countries, a 10-percent increase in penetration results in a 1.3-percent increase in GDP—that’s a huge contribution. So there is a direct relationship between expanding Internet coverage and increase in local output,” he explained.
But aside from spending more to expand the coverage and improve the quality of Internet services in the country, the government should also implement several policy measures to ensure the acceleration of digital transformation initiatives.
For instance, Crisanto said, Globe hopes the government extends or even makes permanent the provisions of Bayanihan 2 Law that suspended national and local permits and licenses for the rollout of telecommunications infrastructure.
Globe has always advocated the reduction of bureaucratic red tape in infrastructure builds, as this has slowed the deployment of much-needed infrastructure in many areas for several years.
The Ayala-led telco, Crisanto said, is also seeking the amendment of the Local Government Code to “prohibit or limit the imposition of tower fees to only an amount that is commensurate to the cost of supervision and inspection of the facilities of the telcos.”
It is also proposing to amend the building code to “mandate the developer or building owner to provide technology-ready facilities, similar to other utilities like power and water,” Crisanto said.
So far, the government has implemented various initiatives through the Anti-Red Tap Authority (Arta) and the Department of Public Works and Highways (DPWH) to provide more leeway for telcos to build their infrastructure.
Smart, Converge weigh in
Smart President Alfredo S. Panlilio lauded these programs, saying that they help accelerate the group’s infrastructure builds despite limitations and restrictions.
“We stand with our government, and grateful for these undertakings, as we work toward providing world-class connectivity for all Filipinos. Together, we will continue to support our increasingly connected societies, especially in the new normal,” he said.
Uy added that Converge is also pushing for the reduction of the required permits and quicker processing for the deployment of fiber-optic cables.
He is also seeking the authority to immediately conduct repair works, especially during night time when the offices are already closed.
“With new technologies in fiber rollout such as the microtrenching equipment that we use, we are able to lay down cables with minimal disruption on thoroughfares. Thus, we hope that we will be allowed to install cables even during the day since the use of these new technologies will have minimal impact on traffic flow during the day. If we are able to roll out fiber-optic cables nonstop, we will be able to deploy faster and immediately serve the connectivity needs of our people,” he explained.
Cabarios, for his part, cited almost-century-old laws that need to be updated, such as the Radio Control Law and the Public Service Act, to facilitate faster processes for infrastructure builds.
Better Broadband Alliance Convener Mary Grace Mirandilla-Santos agreed, adding to the list the approval of the Open Access in Data Transmission Bill to the group’s wish list.
“While the pandemic has fast-tracked broadband rollout, policies such as the Open Access in Data Transmission bill must be put in place to continue the momentum beyond the crisis. The amendments to the Public Service Act, which seeks to reclassify telecommunications as a public service instead of a public utility, should be passed in order to open the industry to more competition,” she said.
Investment climate, competition
These policy reforms, Cabarios explained, will create a “better investment climate” for the telecommunications sector and the ICT industry as a whole.
“We have to improve the investment climate to allow more investments to come in,” he said. “As much as possible, regulations should be only to the barest minimum. Let us allow our telcos to play. Leave them free, but regulate if needed.”
By improving the investment climate, the government will be able to foster a more intense competitive environment, which will then benefit consumers, Santos added.
“It’s very clear that the status quo of restricting market entry and focusing on just the big players, especially in the broadband industry, cannot and must not continue. The only way we can see real change in the state of Philippine Internet is when the market environment becomes conducive to competition and innovation, and where the consumer has a real choice,” she said.
Santos, also an independent ICT researcher, noted that “there are indications” that Converge and Dito are forcing incumbents to step up their game.
“Having a choice of more than two service providers and beyond mobile cellular service will create real competition and real choices. Can you imagine how much more things can improve and how many more Filipinos can benefit from digital transformation if market entry restrictions were eased and barriers, like the Congressional franchise, were removed for Internet services? Broadband infrastructure will become available in more parts of the country. Digitalization will be further accelerated, and no one will be left behind,” she said.
Digital is the new normal
Digital has been slowly becoming the new normal for many parts of the Philippines and the world, and access to the Internet is the bedrock by which these services operate.
Cabarios said the Internet will be key to digital transformation initiatives, which will also help the Philippines become more competitive in the global scene.
“We have to hasten it because the faster we go into digital, then we can compete globally. We have to accelerate transforming the Philippines into digital, or else, we’ll be at a loss,” he said.
And, despite challenges, Crisanto said the future of the telco industry remains “very promising.”
“The pandemic reinforced the need for connectivity as people and businesses shifted their activities from offline to online or digital. Aside from connectivity, Globe is also leveraging the strengths of the core business—brand, customer base, distribution capabilities, market knowledge and synergies with strategic partners to invest in adjacent businesses. These will enable Globe to unlock values beyond telco, by expanding into various digital solutions businesses, thereby transforming the company into a technology-based solutions provider with footprints in fintech, healthcare, entertainment, adtech, e-commerce, manpower, IT services, and venture capital,” she said.
Everyone entitled to a life source
Santos said the industry must act quickly to provide these services to the underserved and unserved sectors of society by democratizing access to the Internet.
“Across the board, we’ve all realized that ICT infrastructure, in particular, the Internet, is an essential service that can support inclusive economic growth and improve people’s lives, pandemic or not. In response to the pandemic, many of our legislators filed bills on digitalization, such as digital payment, e-government, e-health, and digital transformation, among others, only to realize that these services will be difficult to carry out if Internet connection is poor or absent. Either that or the digital services will be available only in the urban areas where Internet connection is concentrated,” she said.
After all, Converge’s Uy asserted, “Internet connection at home has become the lifeline of our people as we now do everything online, at home.”
“Our mission has always been to democratize connectivity. We want to bring this world-class technology to the majority of our people. After all, if Internet is the ‘new oxygen,’ then everybody is entitled to this life source,” he said.
Images courtesy of Nonie Reyes and Bernard Testa