NOW Telecom has selected New Jersey-based Bell Labs Consulting, part of Bell Labs, the research arm of Nokia, to conduct the study.

The grant agreement was signed by NOW Telecom Chairman and Chief Executive Officer Mel Velasco Velarde and Nokia Bell Labs Managing Partner Stefan Wilhelm during the 10^th U.S.-Philippines Bilateral Strategic Dialogue in Manila on January 20.  United States Assistant Secretary of State for East Asian and Pacific Affairs Daniel Kritenbrink, U.S. Ambassador to the Philippines MaryKay Carlson, and Philippines Department of Information and Communications (DICT) Undersecretary for Connectivity Angelo Nuestro witnessed the signing.

“This 5G grant demonstrates the U.S. commitment to developing quality digital infrastructure and increasing access to affordable connectivity in the Philippines,” Assistant Secretary Kritenbrink said.

For his part, DICT Undersecretary Nuestro said, “The open innovation platform that this partnership seeks to give will enable the broader Philippine society to take a leap towards a connected future.  We welcome these opportunities that will improve the lives of Filipinos.”

Under the USTDA grant, the feasibility study will provide NOW Telecom with the necessary analysis, designs, and plans for the phased implementation of the project.  It will also include the establishment of a 5G pilot network at multiple sites in Metro Manila to validate network performance, test 5G use cases, and provide data to inform larger-scale deployment.

This project aims to support the digital transformation of the Philippines by helping to meet the growing demand for high-bandwidth, reliable, and secure digital services from households and industry in the Philippines. 

The feasibility study grant furthers U.S. digital policy in line with the Indo-Pacific Economic Framework, which aims to promote secure digital infrastructure in the region to bolster economic growth and facilitate open digital societies.

The DICT Chief explained, “As soon as all the sealed bids are opened and placed side by side on November 7, the government can provisionally name the firm that submitted the highest committed level of service among all bidders, adding the highly anticipated bidding will proceed “as scheduled without any hitches.”

“We do not see major hitch in opening the bids,” Rio said when asked on the possibility of encountering another delay in the bidding process. He further explained by saying,  “the government put together for a year to consult all stakeholders to come up with reasonable terms of reference.”

“In fact, on November 7 at 10 in the morning we will open all the bidding documents and we will know who will be our provisional third telco provider,” the DICT Secretary added.

“The terms of reference (TOR) bind the winning bidder to the quality of service it committed in its pitch to become the third telco operator. With more competition in the market, the official anticipates the existing players will likewise step up their efforts to retain their subscribers”, Rio said.

“We will be monitoring their commitment because it is through their service that the third telco can build their subscriber base. The only way for them to get subscribers is to give better service and lower subscription cost than the existing players,” he pointed out.

“Of course, market forces will be in play, resulting to better service and lower costs, which the public will benefit overall,” he added.

The DICT Secretary explained, “The TOR also include a performance bond, which the government could forfeit if the winning bidder failed to maintain their committed level of service to its subscribers and the bond is “at least P14 billion.”

Meanwhile,  NOW Telecom sought a temporary restraining order on October 8 against portions of the terms of reference on the bond. However, the court denied the petition of the firm, saying “there is practically nothing to enjoin that will warrant the grant of obtaining such injunctive relief from this court at this time.”

However, the DICT Chief maintained that the TOR had been put together that way to ensure that only serious bidders with sufficient capital can participate in the bidding process. The third telco is projected to spend P40 billion in the first year and P240 billion in the succeeding five years, DICT estimates showed.

Rio cited the case of Altimax Broadcasting Co. Inc, which had been granted a congressional franchise in 1999, but sold its majority stake to a subsidiary of Globe Telecom in 2009 rather than use it. The sale of Altimax, which is owned by NOW Corp. President and Chief Executive Officer Mel Velarde, included frequencies awarded to them by the National Telecommunications Commission, which the firm did not use.

In a nutshell, the Secretary does not want any enterprising individual to cash in on this by bidding, win and sell.

There must be a serious commitment on the bidder. This is the reason why it takes so long for us to make this happen because we made sure that the TOR is clear to every bidder or company that bids.

Read related stories:

DICT Chief expects to name the 3rd major telco player by October 2018                                                                                      http://thephilbiznews.com/2018/08/24/dict-chief-expects-to-name-the-3rd-major-telco-player-by-october-2018/

DICT Acting Chief very satisfied with public hearing                                                                                                                          https://thephilbiznews.com/2018/08/23/dict-acting-chief-very-satisfied-with-public-hearing/