Philippines gives China-backed telecom firm green light to build cell towers on military bases
- The decision has reopened a debate about national security implications surrounding Dito Telecommunity, which is part-owned by China Telecom
- Dito and others have brushed off the concerns, but the company is facing other issues with it planned roll-out amid the coronavirus pandemic
Defence Secretary Delfin Lorenzana told lawmakers at a budget hearing last Tuesday that he had waited to sign off on the deal so that it could be reviewed by the opposition, “but they came out with nothing … no complaint or recommendations on the contract. It was returned to us”.
He said it was only “fair” to allow Dito to build the cell towers as it is “providing telco services in the provinces where most of our camps are” and wanted to place them inside military facilities “for security and protection”.
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Military spokesman Major General Edgard Arevalo said on Friday that the military had assessed the risk of security breaches from the cell towers to be low. Responding to concerns that Dito in particular was a threat because of its partial Chinese ownership, the company’s Chief Administrative Officer Adel Tamano said it guaranteed that “its devices, equipment, and structures shall not be used to obtain classified information from the Armed Forces”.
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Eliseo Rio, a former Information and Communications Technology Secretary who oversaw Dito’s bid to become the Philippines’ third major telecoms provider in 2018, played down the security concerns and reiterated Lorenzana’s stance on market fairness.
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Two years later, in November 2018, Dito won its bid to become the country’s third major telecoms player after two other contenders were deemed to have incomplete documents. It presented an ambitious 257 billion peso (US$5.29 billion) plan to deliver speeds of at least 55 Mbps to 80 per cent of the population by the end of its five-year commitment in July 2024 – on par with the government’s demands during the auction for an operating licence.
Dito has already missed a July 8 deadline for a technical audit as part of its five-year commitment with the government. Under its contract, it was supposed to deliver minimum internet speeds of 27 Mbps to at least 37 per cent of the country one year after its licence was granted.
Tamano said earlier that Dito would need at least 1,300 cell tower sites to deliver such a service, but at that time it only had about 300 that were operational. The company has since requested a six-month postponement for the technical audit.
If the company misses its provisional deadlines three times during the five-year period, it would have to forfeit the 25.7 billion-peso performance bond it paid to the government.
Rio, the former communications secretary, said Dito’s very existence had improved the service Filipinos received from telcos. “The level of service of Globe and PLDT have greatly improved since Dito was named as the third major telco player,” he said.
Grace Mirandilla-Santos, an independent ICT researcher in Manila, said that although “the threat of viable competition can shape the behaviour of existing market players”, more telecoms companies should be invited to push these improvements further.
“Lower barriers to entry and provide consumers with more choices, and watch how providers improve their services to compete for market share,” she said.