Japan, US, Korea, Australia telco firms want to open in Philippines: Will this solve country's internet problem?

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Representational image (Carlos Barria/File Photo/Reuters)

Despite Philippine President Rodrigo Duterte's announcement that he wanted a China Telco firm to be the third telco player in the Philippines, telco firms from Japan, US, Korea and Australia have also signified to become the third internet service provider in the Philippines that could target a potential 50 million prospective internet subscribers.

This was announced by Eliseo Rio, the officer-in-charge of the Department of Information and Communication Technology. However, Rio did not specify the name of the foreign firms.

"Telco firms from Japan, South Korea , US and Australia have shown interest to partner with local firms to become the third player, " Rio said during a press conference.

There are two telco companies operating in the Philippines, namely Globe and SMART but subscribers of these companies have been complaining of the very slow signal of these internet companies services.

A number of Filipinos are involved in online work and the slow internet service has adversely affected their business income.

Earlier, the Chinese government had designated China Telecom to open in the Philippines after the Duterte administration asked the Chinese government to invest in the Philippines in response to the public clamor for a faster and affordable internet speeds that existing telco companies in the Philippines could not provide.

The Philippine government is expected to bid the third telco provider and award the project by the first quarter of 2018.

But one of the biggest challenges of telco is they could not operate a 100% ownership when they established a firm in the Philippines so they have to partner with local Philippine firms as only 60-40 ownership arrangement is allowed by law: 60% to be owned by the local firm and40% to be owned by the foreign firm.

Moreover, the DICT also assured that the government will provide frequencies to a telco that has the financial and technical capacity to ensure they can compete with Smart Communications and Globe Telecom.