China Telecom logo.
In response to the President Duterte’s’ request, China has chosen China Telecom to become the third telco player in the Philippines.
This is a promising news for Filipino internet users who have been complaining with slow connection at high prices from the duopoly of PLDT and Globe. However, there are several challenges that it must overcome before this becomes reality.
China Telecom is the biggest wired internet service provider in China but falls third in wireless services. It has 244.78 million mobile subscribers and 132.14 million wired broadband subscribers in China as of October 2017.
Among the three top telcos in China, it has the fastest growth in 4G users with full coverage of the mainland. This is something that they can hopefully replicate here in the Philippines.
China Telecom is fully owned by the Chinese government.
Based on Philippine laws, foreign companies like China Telecom are limited to 40% ownership of a company here in the Philippines. This means that it needs to partner with a Philippine company to shoulder 60% of the capital.
The Philippine Telegraph & Telephone Corp. or PT&T has been vocal with its desire to become the third major telco player in the country. The two might be the perfect partners.
National Transmission Corporation or TransCo has also expressed its desire to expand into the telco industry but it’s not yet allowed to do so based on its charter.
There are other prospects but the problem is money. Even San Miguel Corp. and Telstra failed to create the hyped third telco before.