The Market Monitor Minding the Nation's Business
By Riza Lozada
Globe Telecom is urging local government units (LGU) to assist it in providing fast and cheap Internet connection in the country.
The communications giant said bureaucratic red tape is slowing down the progress of its $850-million (P39.95 billion at the current rate of P47/$1) Internet connection program.
The telco giant said the program is being implemented piecemeal, depending primarily on the cooperation of local governments particularly on right-of-way or ROW issues.
Globe said that last year, it spent only $750 million (P35.25 billion) for its connectivity programs. The amount was way below its target expense of $850 million yearly due to unresolved bureaucratic hurdles, according to Globe Chief Commercial Officer Albert de Larrazabal.
Spending below capex translated to opportunity losses, based on Globe’s timetable in improving Internet connection particularly for businesses, Larrazabal said.
He said Globe’s program aims to interconnect some 20,000 barangays by 2020 through fiber optic cables that would relieve the current congestion in the Internet network.
“The money is there,” said Larrazabal of the estimated $2 billion (P94 billion) that Globe has earmarked for the barangay fiber optic connectivity project, but that its completion will largely depend on the relations between the communications giant and the local government units it will have to deal with.
Larrazabal said Globe has launched a $1-million (P47-million) project to speed up connectivity in the Binondo district of Manila because it was the Manila city government that responded first to Globe’s call “for local government support for its initiative to build on its network infrastructure and provide better Internet experience for its customers.”
He said the ROW issues, including securing permits and other bureaucratic processes, were among the challenges that Globe has to hurdle in implementing its fast-Internet project.
By the third quarter of this year, Globe expects some 5,000 establishments in Binondo to have fiber connection. This mean that by that time, they will already be benefitting from the fiber speed connection of up to one gigabyte per second or about 500 times faster than the average speed of 2 megabytes per second (mbps) of regular Internet connection.
According to Larrazabal, Globe will also roll out small-cell technology in various parts of Binondo as part of its efforts to expand network coverage and capacity.
The small-cell technology, which supports multiple technologies including 3G and LTE, will enable Globe to harness additional capacity from fiber optics without the need for macro cell sites.
Globe has also coordinate d with the city government of Manila for the construction of additional cell sites not only in Binondo but also in other parts of the city, as part of its continuing coverage and capacity expansion.
“Obtaining permits has been a major hurdle for us in other parts of the country and we are grateful that in the city of Manila, local government executives led by Mayor Joseph Estrada have been supportive of our initiative of building on our existing network infrastructure within the city,” Larrazabal said.
Globe earlier said an uncooperative environment at the local government level is the biggest stumbling block to the telecom giant’s efforts to improve cell-site density, a necessary prerequisite in improving data connectivity of its customers in terms of speed and access.