Ampaw: The Flawed NTC Memorandum Order on Minimum Speed of Broadband Connections

NTC MO 07-07-2011 is a paper tiger

Author’s Note: The full text of the National Telecommunications Commission Memorandum Order No. 07-07-2011 (Minimum Speed of Broadband Connections) was provided via email as an Adobe PDF file, in response to a request for the document.

To the best of the author’s knowledge, NTC MO 07-07-2011 has not yet been published in any newspaper of national circulation.

A sop to Filipino consumers, conceived with no regard to objective realities, and written in a lazy fashion — that, very politely, describes the NTC MO No. 07-07-2011. Not quite unlike a speech given by a traditional politician, it is prefaced by a long-winded introduction and followed by a weak policy.

To be fair, let’s begin our analysis by parsing the strengths of NTC MO 07-07-2011.

First, NTC MO 07-07-2011 requires internet service providers to be transparent in the billing of their subscribers, via Rules 1 and 2 of the order. Transparency is good for us consumers; we’ll know exactly what it is we are paying for.

Second, NTC MO 07-07-2011 requires internet service providers to be provide a minimum service reliability for their subscribers, via Rule 1. Instead of not being certain of getting what we’re paying for, the minimum service reliability ensures that we’re going to get it. In fairness to the ISPs and the NTC, a minimum service reliability of 80% is not too bad, considering the state of telecommunications infrastructure in the Philippines.

Third, NTC MO 07-07-2011 provides internet service providers good flexibility towards developing competition strategies, via Rule 1. By allowing internet service providers to offer the public various packages and prices, the ISP with the most aggressive, the most reliable, and the best-priced packages wins the market.

All that said, and despite the best of intentions, NTC MO 07-07-2011 is useless to us consumers and does nothing concrete to require good service from ISPs. Why?

First, NTC MO 07-07-2011 does not provide effectively for short-term prepaid internet connectivity. With service reliability measured on a monthly basis, prepaid internet subscriptions lasting one day, three days, or a week can easily meet 80% service reliability on paper, with the customer not enjoying the connectivity he has paid for. For instance, should a customer use a 3-day prepaid card and not be connected, his complaint will be easily dismissed once the ISP shows that he could have been connected on the other 27 days of the month, with the ISP meeting a service reliability of 90%.

Considering how much of the broadband market floats on prepaid services, that segment of the consuming public is going to continue to get screwed.

Second, NTC MO 07-07-2011 does not specify where service reliability is to be measured, instead of protecting the consumer by requiring service reliability to be measured at the subscriber end. As such, the internet service provider can very well claim to be meeting 80% service reliability or even higher, by measuring reliability at their end of the transmission medium.

This, despite at his end the consumer keeps on getting “Unable to connect to the Internet” error messages on his browser.

Third, NTC MO 07-07-2011 is silent on data volume capping. Thus, the MO allows for unreasonable data volume capping.

Therefore, a consumer with consistent 1 Mbps connection speeds can have his connection cut off every three days by virtue of a 1 GB data volume cap, and the ISP will still be completely compliant with the memorandum order, for as long as the ISP has a provision on data volume capping in fine print somewhere in the service offer/ contract/ prepaid SIM wrapper.

Fourth, NTC MO 07-07-2011 does not require ISPs to provide clear, timely, and customer-centric rebate mechanisms for customers if service reliability minimums are not met. ISPs can very well still get paid for the services they do not provide, and getting rebates will still be as easy as pulling teeth from a rabid dog using longnose pliers.

Subscribers, therefore, can continue to get screwed under the guise of “ma’am, network maintenance po kasi, di po yan covered ng rebate”, “sir, kelangan complete po ang documents and proof of downtime, tapos wait po kayo ng thirty days tapos i-claim ninyo personally dito sa office namin yung tseke”, and whatnot.

To summarize bluntly the impact of NTC MO 07-07-2011 to internet service providers, compliance to NTC MO 07-07-2011 is as simple as ISPs rewording their boilerplate contracts and marketing collaterals and ensuring that 80% reliability or higher is measured at their end. NTC MO 07-07-2011 will merely require cosmetic changes and tweaks in marketing, rather than significant improvements in service.

To summarize bluntly the impact of NTC MO 07-07-2011 to us consumers, NTC MO 07-07-2011 provides us with absolutely nothing but a wad of used toilet paper.

It’s brilliant, really. This MO will be hailed as a victory for the consuming public, with the perception of the NTC being the white knight riding to the defense against the greedy invading ISPs. The reality, however, is that the NTC MO 07-07-2011 is no more an actual strike for Filipino empowerment than the sham that was the Battle of Manila and the surrender of the Spanish troops to the Americans.

Read the full text of NTC MO 07-07-2011 here. If you want to read a proposed draft of a better memorandum order, one that serves all parties fairly, read this one instead.

And to think we were led to believe that the NTC really does have our interests at heart and does its best to serve us. Bleh.

Image from The Pulse Review (www.pulsereview.com).

Pierre Tito Galla

  • sd

    The problem is, how do we urge the telcos to increase their broadband speeds up to 10 mbps or more?

    • Cocoy

      sd,

      telcos are moving towards that direction. Smart has their Rocket. Globe has their tattoo 4g. It is in “selected” areas right now though, which means tough luck to actually finding one place to get such signal.

      but i hear you.

  • Raddy

    This makes me feel like the NTC and telcos are in cahoots! Hard to prove but something smells…

  • Ken

    NTC MO 07-07-2011 requires internet service providers to be provide a minimum service reliability for their subscribers, via Rule 1.

    This should be really emphasized, they just used term like “with speeds upto” which is very misleading making the subscriber believe that he is actually getting those speed when in fact he is not.

    • that’s why reading the fine print is important.

  • Good one, Pierre!