Philippines: Netizens Follow Telecom Merger Deal Issue

Netizens in the Philippines are closely following the developments of a merger deal between two of the country’s largest telecommunications companies. The Philippine Long Distance Telephone Co. (PLDT) announced last March that it has bought off the Digital Telecommunications with P74.1 billion (US$1.7 billion).

If approved by government regulators, there would be two mobile carriers in the country left with PLDT’s Smart, Talk N’Text, Red Mobile and Digitel’s Sun controlling 70 percent of the market and Globe Telecom and TM controlling the remaining 30 percent.

Edzee’s Net Logs asks if the merger will translate to improved broadband services:

With the merger, PLDT said it hopes to make available to Digitel subscribers better service offerings more specifically 3G or third generation cellular technology and broadband Internet. The question now is . . . will the merger bring about improved broadband service? Will their remaining competitors in providing Internet service to the public try to outdo them?

Roysville does not see anything wrong with the merger.

The PLDT-Digitel deal could be beneficial to the consumers, as long as the other players are able to hold their own, offer better services and more affordable rates and not follow PLDT’s lead should it decide to dictate prices.

Consumers are still the judge… and given a choice, consumers will definitely choose the better service provider without regards to size of the company’s assets.

New Mawe’s Adobo gives 3 reasons why the merger would be bad for Filipinos, namely product inefficiency, restriction of choice, and exploitation of consumers:

Controlling the prices, charges, and other costs of their telecommunications services would be the first on that list. Remember, if this deal goes through, PLDT will control around 70% of the total market. So who’s gonna stop them from hiking up the charges?

The Scribbler worries that the merger would bring back the old days when the country’s telecommunications was in a dismal state with the PLDT monopolizing the industry for decades.

Remember those days when applying for a landline would take you a gazillion years before it gets approved? Okay, not exactly the time span from the Paleolithic to the Neolithic eras, but you get the picture? I recall an acquaintance of mine lamenting that it took 10 years for PLDT to approve their landline application. Ten frickin years! Imagine that!

Here are some reactions from Twitter:

@dalekins: I dont get the reason why people are against pldt-digitel merger specially if youre a smart or sun user. Youll have a bigger unli coverage.

@guiengarma: Is the PLDT-DIGITEL deal pro-consumer? IDK. Is the deal economically friendly following econ. principles? No.

@Olidex: With the pldt-digitel merger, ud think globe would improve its customer service… Nope.

@kim_and_jackie: People forgot that PNoy's uncle & largest campaign donor, Mr Tony Boy Cojuangco, used to call the shots for PLDT when it was a monopoly.

Yugatech meanwhile points out the possible benefits of the merger alongside its more detrimental effects to the consumers.

• Wider network coverage for existing Sun subscribers, especially with 3G mobile internet.
• Smart can increase its network capacity if it is able to use Sun’s assigned frequency (same way Smart expanded with the purchase of CURE’s 3G frequency). That could translate to a less congested network and improved wireless connectivity (I hope).

For BongV of, the Filipino consumer is the ultimate loser merger or no merger.

Your choice is still limited between bad and worst – and you pay more for nonexistent service. But you are used to this situation – after all that’s what’s going on with your water bill, your electric bill, your tollway bill – what’s another higher telecom bill?

Tonyo Cruz of TXTpower calls for more safeguards against the pitfalls of a private monopoly in the telecommunications sector.

The least the public expects is for PLDT and Digitel, moving forward, to push the telcos self-imposed limits on internet and mobile phone services, whether in pricing, speed and quality of service. He could boast about the fortified big-ness of PLDT, but if it does not improve service in a big way, it would be wasting its investment and disappoint Filipinos further. It is an open secret that the Philippines, which PLDT dominates, has the slowest internet speeds in this part of the world.

The TXTpower, a cellphone subscribers’ consumer group, recently filed a pleading against the PLDT-Digitel merger with the National Telecommunications Commission.

Image source for the thumbnail image is from PBN Media Group

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