Business Nightly recently interviewed Ray Anthony Roxas-Chua, and he said that it was a bad idea for the Government to build its own broadband network, and that this is the “extreme response”.
Without a doubt, the Philippines’ network infrastructure isn’t there. I think everyone could agree on that point. Network readiness isn’t great at all. And the lack of reliable, and consistent network framework isn’t there yet. Mobile internet could be great at the heart of Makati for example, but totally useless outside the city. And the common theme for recommending providers remain the same: it would depend on where you are. There are areas where Smart is good, and there are areas where Globe is better, and vice versa.
There are indications that the telecommunications companies are rolling out technologies that would greatly improve the network infrastructure. Particularly, mobile internet infrastructure is being improved by SMART and Globe Telecom. And the infrastructure can’t be built overnight. There is no question about that either.
Likewise we are all in agreement that the Internet is the world’s greatest communications tool. It is a powerful medium. It is also an economic multiplier. More, and more businesses are enabled because of simple things like email, or voice over IP.
Consider also taking into context, studies that show Internet usage is geared towards Internet cafes. With that in mind, what we are certain of, is this. Simple things like sending a presentation to a client, or documents to a client relies more and more on the power of the Internet. It is also true that for the most part, people go nuts when they have to send at least 10MB of presentation files to a client, and they can’t. And on the client’s part— especially if client is in the Philippines, would find it hard to get that same file. It is weird in the sense that sneaker net— passing usb flash drives around is often times faster.
On the side of the telco, the line drives in two ways. First: the MPAA, anti-piracy, people download too much line and the second, Internet is a finite resource. The reason being telecoms around the world are fighting tooth and nail not to be utilities. And these are businesses that need to maximize shareholder profit— nothing wrong with it, of course. The telco position is just a taste of how sore, and complicated, the situation is. Anybody with a business knows too well that striking equilibrium between profit and customer satisfaction is always a balancing act.
On the government side, it is doing two things. One is successful, one isn’t.
Where the government is succeeding right now is using Internet tools. One example of this is how the MMDA is using the web and other tools for traffic management. There are scores of other great examples of how the government is executing, and Secretary Coloma presented some good things about it in his Internet and Mobile Marketing Summit presentation.
What the government isn’t succeeding on is setting policy direction. How does the Government see Broadband? Is it a national imperative to provide every household with Internet, because it is an economic resource much like roads, and electricity? If recent NTC moves is a barometer, then it would appear, Government has fallen short of actually applying a fair and equitable playing field. On top of it there are allegations that while on paper the telco industry is suppose to follow market forces, some sectors allege that it isn’t.
Should the government itself build a broadband network?
What should be done
Government needs to address the lack of policy direction. It really does need to set a fair, and equitable playing field. Would it hurt to bring in new players? No, it wouldn’t.
With regard to the infrastructure itself, there are good broadband success story patterns to follow around the world. The best pattern so far is South Korea. In the South Korean model, the government stepped in to invest in fiber. In the Philippine scene, what in my humble opinion ought to happen is some sort of public-private sector partnership but government needs to see broadband as an economic resource similar to roads and electricity for that to happen, and when it does, appropriately invest in that same direction. Both public and private industries have an interest in getting Broadband to be reliable and fast. The question now is, will there be leadership in that direction?