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LIST: Potential 3rd telco bidders

MANILA, Philippines – The government aims to name this November the 3rd major telecommunications player and shake up the duopoly of Smart and Globe. 

The next player must commit to the Highest Committed Level of Service (HCLoS) specified in the Terms of Reference (TOR).

The following companies bought bidding documents worth P1 million and are likely to participate in the bidding: 

China Telecommunications Corporation

2017 net income: $18.1 billion

China Telecom is the 3rd largest telecommunications provider in China. It is publicly listed in the Hong Kong Stock Exchange and the United States’ New York Stock Exchange.

According to the company's website, they have about 250 million subscribers. It ranked 174th in the Forbes Global 2000 list, a ranking based on a composite ranking on sales, profit, assets, and market value.

President Rodrigo Duterte initially preferred the company to be the 3rd telco player and wanted it to operate in the 1st quarter of 2018. However, the government eventually opened the doors to other players.

Telenor

2017 net income: $13.4 billion

Telenor is a Norwegian multinational telecommunications company and operates in Scandinavia, Eastern Europe, and Asia.

The company says it has over 172 million customers worldwide and boasts assets in mobile, broadband, and TV services. 

Telenor was founded in 1855 and builds on over 160 years of telecom experience.

The company has yet to disclose its local partner.

Mobiltel Holding GmbH

2017 net income: $5 billion

The NTC announced that an Austria-based company called Mobiltel Holding GmbH bought bid documents. However, a Google search indicated that the company is now called A1 Telekom, which has a separate entity called A1 Telekom Austria Group.

The company website says that the company is listed on the Vienna Stock Exchange and has over 24 million customers.

A1 Telekom has operations in Austria, Bulgaria, Croatia, Slovenia, Belarus, Serbia, and Macedonia.

Other than communications, the company also offers payment, entertainment services, and integrated business solutions.

NOW Telecom

NOW Corp 2017 net income: $130,000

NOW Telecom is a subsidiary of publicly-listed firm NOW Corporation. (WATCH: Rappler Talk: NOW Telecom's bid for 3rd telco slot)

The company specializes in providing broadband connectivity of large and medium enterprises, government organizations, residential buildings, and special economic zones.

NOW Corporation’s 2017 net income stood at P6.7 million or just under $130,000.

Both companies filed a case against the NTC over the TOR’s alleged “money-making” schemes. They also called the selection process “anti-Filipino.”

Despite the complaints, they said they will still be bidding for the 3rd telco slot.

LCS Group of Companies and TierOne

Former Ilocos Sur Governor Chavit Singson’s namesake company, the Luis Chavit Singson (LCS) Group banded with Mindanao-based internet provider TierOne Communications to bid for the 3rd telco slot.

The LCS Group comprises a diverse array of companies, one of which is Gracia Telecom. It caters to customers in Singson’s stronghold in Ilocos Sur. (WATCH: Rappler Talk: Chavit Singson’s bid for the 3rd telco slot)

TierOne has 17 more consortium partners to solidify their bid. Each company has its own specialization, ranging from mobile services, solar energy, software development, to advertising.

The consortium has a combined annual revenue of $3.1 billion.

TierOne aims to roll out over 50,000 cell sites nationwide. 

The LCS Group-TierOne tandem is banking on a broadband satellite for a nationwide reach, and promises the cheapest rates.

PT&T

2017 net income: -$505,176

The Philippine Telegraph & Telephone Corporation is a diversified telecommunications entity which caters to corporate, small/medium business, and residential segments.

PT&T listed on the Philippine Stock Exchange (PSE) in 1990, but requested voluntary suspension of trading last December 13, 2004. Its shares closed at P0.33 a piece.

The company aimed to resume trading of some 800 million common shares in the local bourse this year, but plans have not yet been realized.

Its fiber optic network spans to over 1,000 kilometers and serves customers in the Greater Manila Area, northern and Southern Luzon, and Cebu.

Udenna Corporation

Net income as of 2014: $15.5 million

Attached listed firms:

Davao-based tycoon Dennis Uy’s shopping spree for companies and portfolio expansion continue in the telco space through his holding firm Udenna Corporation.

Incorporated in 2002, it is among the fastest growing holding companies in the Philippines. It is in the business of distribution and retail of petroleum products and lubricants of Phoenix Petroleum.

Udenna is also engaged in shipping and logistics through its wholly-owned subsidiary, Chelsea Logistics Holdings Corporation.

It also has interests in real estate through Udenna Development Corporation (UDEVCO).

Other companies under Udenna Corporation are Udenna Management and Resources Corporation, and Udenna Water and Integrated Services.

Udenna Corporation is poised to complete its backdoor listing in the PSE through ISM Communications via a whopping P72-billion share swap.

The company needs to team up with a local company with a telco franchise to qualify for the bid. They have yet to disclose details on the matter.

Converge ICT

Another Dennis Uy is also eyeing for the 3rd telco slot. 

Converge ICT of the Pampanga-based businessman Dennis Anthony Uy is poised to team up with Korea Telecom (KT) to disrupt the duopoloy of Globe and Smart.

According to their website, Converge ICT offers end-to-end fiber internet network in the country and has other digital consumer-centric services.

The company also has partnerships with international companies like Verizon, Singtel, Telstra, Facebook, Netflix, Google, and Sprint for various services.

Meanwhile, KT serves about 90% of South Korea’s fixed-line subscribers and 45% of high-speed internet users.

KT is listed in the US and raked in some $421 million of net income in 2017 and has total assets worth $27 billion.

AMA Telecommunications Corporation

The subsidiary of AMA Education System, AMA Telecommunications, is reported to have joined forces with Middle Eastern companies for the 3rd telco slot.

The AMA Group is led by businessman Amable Aguiluz V. The companies under the group are mostly related to information technology education.

AMA Telecommunications has no digital footprint but acquired a congressional franchise in 2016.

The company has yet to disclose its foreign partners.

Undisclosed bidder

One mystery company has yet to reveal itself to the public. 

Some speculated that it is the Villar-led company Streamtech Technologies, as it was recently granted a congressional franchise.

However, Streamtech Chair Paolo Villar said they have decided to drop the bid and focus on internal expansion programs and strategies. 

Bidding for the 3rd telco slot will commence on November 7. – Rappler.com

Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.

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