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Lawsuits to impede 3rd telecom player

The latest Pac-Man in the business community emerged as the lone bidder in the government’s search for a third major telecommunications player. But lawsuits are expected to greet the National Telecommunications Commission and the Department of Information and Communications Technology even before the two agencies can proceed with the selection of the third telco player.

The NTC and DICT have not awarded the third telco slot as of press time pending a further review of the documents submitted by the lone bidder. The group of Davao-based businessman Dennis Uy and China Telecommunications Corp. turned out to be the only bidder after two potential contenders were disqualified. 

The two other bidders—Philippine Telegraph and Telephone Corp. and the consortium of politician Chavit Singson’s LCS Group and TierOne—have been disqualified because of incomplete documents. 

The three were among the seven that last expressed interest to become the country’s third major telco player. The other four were  Norway’s Telenor Group, NOW Corp. of businessman Mel Velarde and two others who requested not to be named.

NTC Selection Committee chair Ella Lopez said the Udenna Group of Uy through the Mislatel Consortium passed the preliminary evaluation and was qualified to proceed with the selection for  the new major player.

Mislatel is a joint venture of Uy’s Udenna Corp., its subsidiary Chelsea Logistics Holdings Corp., China-owned China Telecommunications Corp. and Mindanao Islamic Telephone Co. Inc. (Mislatel), which holds a Congressional franchise to operate telecom services. 

PT&T, according to the committee, failed to submit a certification of technical capability from NTC, while LSC-TierOne Group was disqualified for not submitting the “participation security” of P700 million.

The two disqualified bidders, however, said they would appeal the decision with the NTC in the next three days. 

PT&T president James Velasquez said the bidding process was unfair. “If we have given a certificate, we would have complied 100 percent. We have complied all the requirements, including the P700-million participation security and the P10 billion paid capital,” he says. 

“If you look at the MC [memorandum circular] we complied because there it was clear that national [scale] is equivalent to regional. If they change that in the bid bulletin, I think that’s irregular and that’s what we found,” Velasquez added.

Simon Fjell, co-founder of TierOne, is also set to appeal the disqualification. Sear Telecom, a consortium led by LSC Group and TierOne, said it would file a case against Mislatel for breach of contract.

Mislatel, according to Raoul Creencia, managing partner of Sear, is not allowed to have its franchise used by somebody else “without prior official consent of DigiPhil Technology Inc.” 

“DigiPhil in other words, has the right of first refusal. The prohibition actually is not absolute, for as long as they get consent of DigiPhil,” he adds.  DigiPhil is a unit of TierOne Communications International.

“If Mislatel will be adjudged to have breached the contract, it is therefore not eligible to partner with, so there is no congressional franchise and new major player. That’s a fatal flaw,” Creencia said. 

Mislatel holds a Congressional franchise to operate telecom services, which was used Uy’s Udenna and China Telecom. 

Another potential bidder, Converge ICT and partner KT Corporation, did not submit bid documents because they found the “venture commercially unviable.” 

Smart move

Smart Communications Inc. is leading in the mobile video performance and surprisingly has become competitive worldwide.

Independent mobile analytics company OpenSignal released its first per-operator study for Asian telecom carriers, breaking down and detailing mobile video performance per carrier in Singapore, Australia, Taiwan, Myanmar, Thailand, Malaysia, Indonesia, Cambodia and the Philippines.

OpenSignal, building on its previous State of Mobile Video report, said Smart garnered a video experience score of 42.2, ahead competitor Globe Telecom Inc.’s 29.2, and well above the Philippines’ overall score of 34.98. In the same report, Open Signal said Smart’s performance was comparable with video experience on US carriers.

OpenSignal reports showed Smart’s score to be at par with that of international carriers, such as AT&T’s 40.88 and Sprint’s 41.1, concluding that Smart has been providing its customers the better video experience in the country.

OpenSignal’s per-operator study included special reports on video experience in Europe and US.

OpenSignal said as global demand for mobile video continued to rise, the demand for better video experience was also increasing. In its first State of Mobile Video report, OpenSignal found that the best mobile video experience could be found in Europe, with Czech Republic topping the list of 69 covered countries with a score of 68.52. The Philippines scored 34.98 in the study released in September.

OpenSignal says the video experience metric measures exactly what consumers are experiencing when they watch videos. Built on an International Telecommunication Union-based approach for measuring video quality, it is derived from several underlying parameters based on real-world measurements of video streams from the world’s largest video content providers.

The study, which collected responses from 10 countries in August, showed that viewers in the Philippines watch the most online video each week at eight hours and 46 minutes—even more than in India and the US, where people watched close to eight and a half hours of online video.

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Topics: Pac-Man , National Telecommunications Commission , Department of Information and Communications Technology , Raoul Creencia , James Velasquez
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