Is the Internet a value added service?

The NTC believes, and continues to believe that broadband is a value added service. Value added service is another speak for, “add on.” NTC believes that this isn’t the telco’s main business, but their side business.

In the face of an age where the Internet is slowly creeping to be everywhere, this seem to be an archaic position. More and more people are using data more than they are using SMS. Granted much of the population are still on older phones, and much of the population is still using SMS and phone, the industry is in a period of transition much like the move from landlines to mobile phones themselves.

Telcos are using mobile internet as alternative in areas where they have reached capacity on DSL connections. And consumers are readily switching to these mobile broadband connections because work can not be done without Internet. It is a fact of the 21st Century. Email is routed everywhere. Webservices, information on social networks, and even Youtube have serious aspects.

What’s also clear is that Broadband is not a national strategy. This is a mistake in the face of severe lapses in education, in science, and in business infrastructure. Where once a nation is judged by businesses on the state of their roads, and phone lines, businesses today look at how great a country’s Internet connection is.

The recent 2011 Sendai Earthquake is proof of the vulnerability of the Philippines in a regional disaster. Internet services in some parts of the country, went down. It also proved the weaknesses in telco Internet exchange interconnection, as sites hosted locally were the hardest hit. They were the hardest hit because for some providers, they send traffic outside the philippines, before coming back to view sites hosted locally.

While it shouldn’t be government policy to run the telco business, it is government policy to dictate the basic rules of the game, and to enforce those rules. How can the government enforce, much less dictate using terms and policies from the age of dial-up? The NTC is surely behind the times.

What is pretty clear in the face of global change, in the face of how much the Internet is instrumental in every part of people’s lives, and continues to grow, the Internet access must be considered as a right. At the same time, Internet infrastructure must maintain its core ethos: that no one group controls it and any law or policy must respect network neutrality.

It seems pretty clear that going forward, the Philippines must adapt an Internet policy that respects network neutrality; that sees the Internet as a right, and at the same time, be cognizant that the business of Internet infrastructure must be open to as many players as possible, and it must ensure that the government itself must not have physical control over the infrastructure. Internet is no longer a value added service, but the business itself. The faster the government recognizes this, and the importance of Internet in a long term national strategy, the better it is for people.

Update: Reader Rob Sanchez also noted that the big telcos’ business isn’t value added anymore.

Cocoy Dayao

Cocoy is the Chief Technology Officer of Lab Rats Technica, a Digital Consulting company that specialises in DevOps, iOS, and Web Apps, E-Commerce sites, Cybersecurity and Social Media consulting. He is a technology enthusiast, political junkie and social observer who enjoys a good cup of coffee, comic books, and tweets as @cocoy on twitter.

Cocoy is also the Managing Director and Editor-in-Chief of the ProPinoy Project.

Cocoy considers himself to be Liberal.

  • J_ag ,

    No question that new improved technologies in communication is driving human development.

    From smoke signals and drums to broadband.

    But these are but a series of interlinked innovations all driven by energy based mechanization.

    Firewood to water to coal to oil to gasoline, to the sun, wind and the atom and maybe fusion.

    Where is the Philippines in the scheme of things?

    Man has now learned how build machines that can think and speak. However the intellectual capacity to discern and contextualize is and always will remain a human trait.

    • mario taporco ,

      Bert my good friend, your putting this nation of ours in a dilemma. Let me ask you a question.

      But first, here’s an example,  let’s suppose there’s just one operator[Telco]. The customer[UP Nn Grad] hopefully by this time is still sovereign, and can choose between connecting or not.

      And here is the question:
      What would happen…,?”

      • Cocoy ,

        On the droid issue, Smart Telecom is building an android market place. So they are taking advantage of the market. How they will execute is still up in the air. They did make a big deal about it during mobile congress in Barcelona in Feb. How big a deal, they have a Jollibee app for their own android devices, and payment done through Smart money.

        • mario taporco ,

          Cocoy, I think you summoned it up with my reply comments from above. This is the time to seize the opportunity of Androids.  

      • Bert ,

        “Is the Internet a value added service?”


        Of course not. Like potable water, roads, ports, etc., internet is a necessity, here’s why:

        Take internet out of the the Philippines and see what will happen to this country. As easy as that.


        • Prudence ,

          We have every right to a good service, whether Internet, education, etcetera. But it’s different when we say we have the right to Internet, per se. Like what Cocoy said, we still have to pay for access. But we can demand to get our money’s worth. And telcos aren’t providing that now.

          • Rob Sanchez Jr ,

            Thanks for including my post on the update!

            • J_ag ,

              Another example of our dualist type of economy.

              While 15 million households in the Philippines still do not have access to potable water we want to debate the issue of broadband as a right. The country has 17 + million households.

              The communications grid is also going through a revolutionary process.

              Broadband is supplying a faster and broader infrastructure for bits of information to pass through.

              Off course it is not a value added. But again which comes first; potable water, roads, ports, energy grid or an upgraded communications grid.

              Water is used for energy generation, agriculture and human survival.

              By all means let us debate broadband as a right.

              A country that does not have a land use and resource use roadmap that makes the building of all these grids efficiently possible and we should debate broadband.

              Government should steer the ship of state and when necessary have the means to fire up the engines. What happens when the country still does not have ship of state?

              • GabbyD ,

                so jag, which DOES come first, you think? can’t ANY of those be first?

                • UP nn grad ,

                  water comes first. Among reasons MILF renegades detonate grenade and mortars is to protest their communities ignored by Malacanang — lack of water.

                  • GabbyD ,

                    really? they are fighting for water? walang water table doon? this is the first time i’m hearing this. details pls!

                  • UP nn grad ,

                    water comes first. you get diarrhea (and can even die — dehydration) from lack of sanitary water. Unsanitary internet would be porn — no one dies from porn.

                    • J_ag ,

                      I go back to the moral philosopher Adam Smith.

                      Labor has three levels of consumption. Needs, Wants and Enjoyment.

                      Economist know better today when they concentrate monetary policy on core inflation.

                      That is inflation minus the price of food and energy. Prices of internet services are a small negligible part of the CPI and core inflation. . Price of food and fire is high up in the hierarchy and states intervene massively to provide access to food and energy.

                      The DOHA round cannot go through because the West insists on subsidizing their agricultural sector and want the farmers in the developing world to compete. Plus the West subsidizes their oil, gas and nuclear industries. There would be no nuclear power plants without government guarantees in one form or another.

                      The estimates of Philippine production called GDP is about Php 9 trillion. However the formal economy that is identifiable is around Php 4-5 trillion.

                      The informal sector is too diffused and microscopic.

                      The segment affected by the internet and broadband is still microscopic to be an effective political force.

                • mario taporco ,

                  Freedom of expression is a very vital part for each individual. Our rights to explore in our social-net, also globally.

                  With that, the Internet’s open architecture pushes decision making and intelligence to the edge of the network to end users, to “the cloud“, to businesses of every size and in every sector of the economy, to creators and speakers across our great archipelagos, our nation, and around the mass earth we live in; the world.

                  Hopefully the philippines government would fully understand the importancy, and the functionality of its neutrality.

                  Specially for the business sector. For this reason, there should be more competitive provider and enhance the capabilities of its provision to the user. (Of course with transparancy for the services they provide for the end users.)

                  This is funny: “How can the government enforce, much less dictate using terms and policies from the age of dial-up?” per cocoy

                  “without it, comes great loss of discourse for the media also for the end-user.”

                  Just a note, I am an iPhone user since the beginning of time, since apple introduced their first generation of iPhones. With these great smart phone technology popping up, I am now considering updating to becoming a full blown Droidster user.

                  “Nothing wrong with iPhone’s, I just want to change my using habits, that’s all.” 
                  In my humble opinion, anyone may contribute and innovate without permission. Value added service, I don’t think so. 

                  Just a thought…!

                  • Cocoy ,

                    Mario, once you step on that dark Droid path, forever will it dominate your destiny!

                    The telco sector has always rattled that they are for market forces. market forces are fine, and they should get all their profit from it, but their service is just lousy. One can’t even recommend a lesser evil. I suppose this is how it goes the world over. Something has to change.

                    • mario taporco ,

                      Cocoy, just a bit of glimpse about the iPhone. It still has the grasp of me. Knowing the facts that, when apple introduces new contraption out on the market, the company doesn’t really need a good PR, people will just line up, and purchase the damn thing.

                      Me rolling with droids, the functionality of its app’s on the market are still in progress. Not the iPhone’s, which has gazillions of them, but “Android” are stepping up with the smart phones on the market, and its features “open source code” capability.

                      To me, this where educated Filipinos can take the opportunities of Androids, to make it profitable for themselves.

                      “And for you developers out there, this is the time to take advantage, and the opportunity.”

                      Will it change my perspective of things…,? I think not. But, it will educate me further more.

                  • Rob Sanchez Jr ,

                    I’ve decided to put in my two-centavos worth in this topic: Broadband Internet is not a Value Added Service (

                    • prudence ,

                      It falls more properly to right to information, I should say. Can a beggar demand right to internet connection, as he can demand right to food and water?

                      • Cocoy ,

                        Yes, Internet freedom is more about the right to freedom of expression/assembly applied online, than being given free internet. People will still need to pay for their internet. I think that’s a distinction that needs to be set. So a government can’t just yank a webpage off the internet, without due process. Things like that.

                        • UP nn grad ,

                          good point that prudence makes. Right to information means that the information can be obtained by the citizens when the citizens want it. So primary will be “no websites critical of Malacanang being brought down” because it had name like AntiPresiNoy or AntiPinoy or such thing.

                          And right to information can be met by a 56kbit/second speed as long as the information is available, and it is correct when an enterprise charges money for that speed (no difference with paying for water).

                          Pilipinas still has an infrastructure problem to make access-to-information ubiquitous. Many Pilipinas barangays do not have access to internet (just like many barangays still do not have access to safe drinking water).

                          • the jester-in-exile ,

                            on the other hand, a caveat: slow connectivity -> slow acquisition of information -> exercise of right to information slowed down. or stopped.


                        • Cocoy ,

                          @prudence, Secretary Clinton started calling it, “Internet Freedom,” last year.

                          She said, “In accepting the Nobel Prize, President Obama spoke about the need to build a world in which peace rests on the inherent rights and dignities of every individual. And in my speech on human rights at Georgetown a few days later, I talked about how we must find ways to make human rights a reality. Today, we find an urgent need to protect these freedoms on the digital frontiers of the 21st century.

                          There are many other networks in the world. Some aid in the movement of people or resources, and some facilitate exchanges between individuals with the same work or interests. But the internet is a network that magnifies the power and potential of all others. And that’s why we believe it’s critical that its users are assured certain basic freedoms. Freedom of expression is first among them. This freedom is no longer defined solely by whether citizens can go into the town square and criticize their government without fear of retribution. Blogs, emails, social networks, and text messages have opened up new forums for exchanging ideas, and created new targets for censorship. ”

                          Internet freedom is about protecting the digital frontiers we have. Forums, blogs, social networks, video blogs, and websites of all sorts. We’ve seen what has happened in regimes that have cut off the Internet. It happened in the Middle east recently. Who is to say it can’t happen elsewhere? We need to have a world were governments can’t cut off the lines of information. At the same time, also guarantee protection of individuals from harassment. Like how many times have you been harassed on text?

                          • Prudence ,

                            I’m not sure though if we can strictly consider internet connection as a “right”. Sure, giving more people internet connection may increase productivity. However, can every person demand that he should be given internet access? Like a person’s right to suffrage?

                            I would have to agree, though, that internet service shouldn’t be considered as value-added service anymore. Most people nowadays depend on a viable internet service/connection to do their work.