China Telecom to help establish 3rd PH telco player – Andanar

MANILA, Philippines – The Chinese government has selected China Telecom to invest in the Philippines in a bid to break the current duopoly in the local telecommunications industry, Malacañang said Sunday, December 10.

"Nakapili na ang Chinese government ng kumpanya sa China na mag-i-invest sa telco dito sa bansa natin. Ito ay ang kumpanyang China Telecom (The Chinese government has selected China Telecom to invest in telecommunications in our country)," Communications Secretary Martin Andanar said in an interview on radio dzBB Sunday.

Andanar said this was disclosed by Eliseo Rio, acting Secretary of the Department of Information and Communications Technology (DICT), during the last Cabinet meeting December 5.

China Telecom Corporation Ltd is one of China's biggest telecom companies, and is one of two that have expressed interest in entering the Philippine market – the other being China Mobile Limited. (READ: China Mobile or China Telecom as Philippines' 3rd major telco?)

It is the second largest telecommunications company in China, with around 215 million mobile subscribers, 123 million wireline broadband subscribers, and 127 million access lines as of end-1016.

Andanar said China Telecom would now need to look for a partner in the Philippines, in keeping up with rules on foreign ownership limitations in the Philippines.

Under the 1987 Philippine Constitution, only companies with at least 60% Philippine ownership can operate as a public utility.

"Kailangan mo nga iyong makikipag-partner doon sa hindi pipitsugin, at of course iyong mayroon nang telecom franchise (You'll need a partner that isn't so-so, and of course one that already holds a telecom franchise.)," he said.

"Minamadali na ito ng gobyerno natin sapagka’t habang tumatagal eh nabubuwisit ang mga kababayan natin sa mga dropped calls at mabagal na internet," he added.

(We're speeding this up because as time passes, our countrymen are getting more annoyed by dropped calls and slow internet.)

Malacañang said back then that the offer was made by Duterte during bilateral talks with Chinese Premier Li Keqiang, when he was here during the ASEAN Summit.

The offer was made to China, the Palace said, because of its proven capability to provide telecom services to millions of users.

The last time the Philippine government entered into a communications deal with a Chinese company was in 2007 when the administration of President Gloria Macapagal-Arroyo signed a multimillion-dollar deal with Chinese firm ZTE for a national broadband network.

The project, however, was riddled with anomalies, including including allegations of overpricing and corruption among government officials who brokered the deal. –