Competition is always better

With persistent complaints of slow and—worse—expensive internet, it seems that getting the telcos to ramp up speed and service hasn't been easy for government. 

Until now.

Reacting to reports of a third player entering the market from China, the country's two major telecommunications companies recently announced an unprecedented spending binge, to the point of selling P10 billion in assets, all to fund an expansion meant to deal with the increased competition from a third player.

The GMA NEWS report on it summarized it well:

“We will announce a historic high in capex next year, north of P50 billion,” PLDT CEO and President Manuel Pangilinan told reporters in Taguig City on Wednesday.

The company will be able to finance up to P40 billion, with PLDT raising the rest of the money by selling assets, Pangilinan noted."

While business expansion is a given, doing so in this manner is not. It seems that PLDT and the other member of the current  duopoly, Globe Telecom, fear the entry of plausibly a low cost and fast provider that may force them to lower their own prices and squeeze margins just to keep up.

Did it take the threat of a third player to force PLDT, and perhaps Globe Telecom, to cough up the money to ensure better service? 

Remember when the telecoms sector was first liberalized in the mid 90's? We had several players to which regions were allocated, all to ensure equitable good service. We had Bayantel, Islacom, Smart, Digitel and other smaller players.

The two bigger companies PLDT and Globe Telecoms ate each of them up over the next decade, finally ending up in a duopoly by 2011. 

This was when our internet woes began to hurt. As DSL lines began to replace old dial up internet service,  we noticed that our neighbors in Thailand, Hong Kong and Malaysia were getting better speeds at much lower cost than we had here.

Will the constant complaints of slow internet (and arrogant technicians) finally stop? 

Will we finally see value for money in our internet service? It seems that under the current government, competitiveness will return. And the better for all of us.