Gov’t to auction off unassigned frequencies to 3rd telco aspirants

A new draft terms of reference (TOR) showed Thursday that the third telecommunications player will be selected based on the highest bid in the auction for unassigned frequencies.

The draft is a joint memorandum circular by the Department of Information and Communications Technology (DICT), Department of Finance (DOF), National Telecommunications Commission (NTC), and National Security Adviser—the Oversight Committee on the Selection of Third Telco Player.

“The participant that offers the highest amount of bid for five years shall be selected as the new major player,” the draft terms read.

"“After the said period, the new major player shall be subject to the applicable Spectrum User Fee pursuant to prevailing rules and regulations. The minimum amount of bid shall be P36.58 billion.”

The joint memorandum circular is separate from the draft terms released by the DICT on June 26, which used the "highest committed level of service" formula.

The DICT's draft requires companies vying for the third telco slot to shell out at least P40 billion a year.

Finance Secretary Carlos Dominguez III earlier labeled the “highest committed level of service” criteria “weak” and that it fails to ensure that the third telco has the capability, both financial and technical, to compete in the long-term.

The DICT said that the minimum bid amount under the latest draft terms does not yet consider the inputs and recommendations of experts from International Telecommunication Union and best practices from other countries.

“Further, while there is a minimum bid amount, in this mode of selection, there will be no cap on the bid amount as the participant who submits the highest bid shall be selected as the new major player,"” the DICT said.

Both draft terms of references will be discussed during the market study and public consultation to be held next week, it said.

Earlier this month, the department belied claims that the third telco initiative was “dead”— noting that initiative will push through. 

Because the industry is considered a duopoly dominated by rivals PLDT and Globe, calls have been made by no less than President Duterte and the public at large for a third telco player to raise the quality of service while lowering the costs to consumers. —Ted Cordero/VDS, GMA News