PPP to hike broadband penetration in PH – Google exec

MANILA, Philippines – Rolling out a National Broadband Network (NBN) project under the Public-Private Partnership (PPP) scheme could help improve broadband penetration in the Philippines, an official of Google said.

At the Philippine Development Forum on Tuesday, October 9, Google Inc. Vice President for Infrastructure Eric Brewer said creating a broadband network could also help increase the Philippines’ economic growth, like what happened to India.

Brewer said in India, a 10% increase in broadband penetration translated into a 1.4% increase in its gross domestic product (GDP).

“I would say that [a broadband network] is a good place for some kind of Public Private Partnership. It also can be done in a variety of different ways including different kinds of financing,” Brewer told Rappler in an interview at the sidelines of the forum.

Worthwhile investment

The Google executive said in East Africa, most broadband networks are owned by the government, while in the United States, these are mostly owned by the private sector.

But no matter how a country chooses to undertake a broadband network project, Brewer said it is a good long-term investment.

He said a broadband network will also encourage more Filipinos to go into software development.

He said his dream for the Philippines is for it to be established in software development by 2030 or earlier. Brewer said maybe in the near future, each of the Philippines’ islands would be able to create a software, and this means roughly 7,100 possibilities for the country.

Ongoing debate

At the sidelines of the forum, Budget Secretary Florencio Abad told Rappler that there is now an ongoing debate in government on how to rollout a broadband network project.

It can be noted that an NBN project was rolled out by the administration of fomer President Gloria Arroyo, but it was shelved following allegations of collusion and corruption.

Abad said the debate is now leaning in favor of private sector taking charge of the broadband network mainly because of the nature of the project. He said managing the system will require a more “nimble” entity such as the private sector.

“One school of thought says its better for the private sector to be investing and managing a broadband system, especially now you’re talking about cloud computing. That requires a lot of innovation and you know we’re not sure whether government is the proper vehicle to build that infrastructure, manage it, and develop it,” Abad said.

However, Abad said the only argument that is favoring government ownership of an NBN project is security issues. It can be noted that the President has already signed into law the Data Privacy Act of 2012, which could protect Filipinos’ identities and provide a boost to the IT-outsourcing sector, among others.

“The other [side of the debate] is of course security and you have control so somehow you have to make a choice what is important for us. I think in the end, right now, the debate is pushing for more along the lines of private initiative,” Abad added.

Broadband penetration in PH

The State of Broadband 2012 report of the International Telecommunication Union (ITU) and the United Nations Educational, Scientific and Cultural Organization (UNESCO) showed only two out of 100 Filipinos had access to a fixed broadband network connection.

However, the report showed that social network penetration in the Philippines stood at above 70%, making it one of the most social media savvy countries in the world, along with Indonesia. The two countries beat the United States and United Kingdom in terms of social media penetration.

The report cited data from a World Bank report in 2009, which estimated that a 10% increase in broadband penetration would cause a 1.21% to 1.38% increase in GDP growth on average for high income and low- and middle-income countries.

The ITU said these estimates are the same for countries like the Philippines, Panama, and Turkey.

“Mobile broadband adoption was found to contribute an annual 0.32% of GDP. Given the importance of mobile in the economy of the Philippines, this would account for 6.9% of all GDP growth for the economy during the past decade, according to the Broadband Commission’s case study of the Philippines, carried out by Dr. Raul Katz,” the report stated. – Rappler.com