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Wednesday, July 24, 2024

The urgency for broadband infra upgrades

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“The direct and immediate impact of fast broadband connectivity to all the economic pillars of Philippine society is pretty obvious”

The need to expand and upgrade broadband infrastructure in the Philippines has become increasingly critical.

As highlighted by Ookla’s Speedtest Global Index, as of May 2024 the Philippines ranks 83rd in mobile internet speed at 32.12 Mbps, which is considerably lower than Vietnam’s 52.15 Mbps, Singapore’s 99.29 Mbps, and Malaysia’s 95.66 Mbps.

In terms of fixed broadband, the country is positioned 56th with an average speed of 94.50 Mbps, trailing behind Vietnam’s 129.01 Mbps, Malaysia’s 134.44 Mbps, Thailand’s 235.86 Mbps, and Singapore’s 289.98 Mbps.

This situation not only hampers our nation’s competitiveness in the global digital economy but also impedes the overall economic and social development of our population.

These rankings starkly illustrate the gap the Philippines needs to bridge to achieve parity with its regional peers.

This lag is a substantial barrier to the nation’s aspirations of becoming a middle-income economy, as it affects various sectors, from business operations to educational opportunities.

One of the primary reasons for this lag is the significant disparity in broadband infrastructure investment between the governments of the Philippines and other Asian countries.

For instance, the 2023 budget for the National Broadband Plan by the Department of Information and Communications Technology stood at P1.9 billion, approximately US$0.032 billion at current exchange rates.

In stark contrast, Indonesia invested $2.06 billion, Malaysia $5.1 billion, Singapore $2.8 billion, and China with a staggering $1.4 trillion.

This comparison highlights the insufficient government funding allocated to digital infrastructure in the Philippines.

Even Vietnam, which has surpassed the Philippines in various broadband metrics, invested $0.82 billion, underscoring the urgent need for the Philippine government to scale up its investment efforts substantially.

The private sector in the Philippines has consistently demonstrated its drive to invest in digital infrastructure, with the top three telecommunications companies collectively investing approximately P1.079 trillion from 2018 to 2023.

This investment is significantly higher than the government’s allocation for the same period, which was only P43.3 billion pesos.

While these private investments are commendable, they are not sufficient to close the broadband infrastructure gap entirely.

A coordinated approach where both the government and private sector would align their resources and strategies is crucial to enhancing the country’s digital capabilities and ensuring broadband connectivity that meets global standards.

Broadband connectivity and cloud based technologies are now essential utilities of economic growth, education, and social development.

It enables efficient communication, access to information, and the unceasing development of innovative technologies.

For the Philippines, improving broadband infrastructure is not just about catching up with international standards; it is about empowering its people and industries to compete effectively in a highly digitized world.

A robust and accessible broadband network can transform the potential of the Philippines’ digital-savvy population, turning them from mere consumers to innovators of new digital technologies.

This transformation is vital for fostering a knowledge-based economy where new ideas for new digital technologies can thrive.

Given the urgency and importance of upgrading broadband infrastructure, the Philippine government should consider several policy actions:

First, the government needs to significantly boost its investment in broadband infrastructure to match or exceed the investments of neighboring countries.

This includes increasing the budget for the National Broadband Plan and other related initiatives.

Second, strengthen collaboration between the government and the private sector to leverage resources and expertise.

This partnership can accelerate the building of mobile and fiber cable networks that integrates private and government owned assets to deliver high-speed internet across the country, especially in underserved and rural areas.

Third, implement regulatory reforms that encourage innovation in digital technologies.

This can include incentives for new locators and support for research and development in digital technologies.

Fourth, invest in education and training programs to develop a skilled workforce capable of supporting and driving the digital economy.

This includes programs focused on digital literacy, coding, cybersecurity, artificial intelligence, and other digital tech skills.

The direct and immediate impact of fast broadband connectivity to all the economic pillars of Philippine society is pretty obvious.

By aligning government resources with the aggressive and forward-looking investment outlook of the private telcos, the country can bridge the connectivity gap, and enable local industries to compete and thrive in the borderless global digital economy.

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