Globe to Gov’t: Develop broadband infrastructure in rural areas

Globe Telecom is calling on the government to help develop broadband access in the Philippines by investing in internet infrastructure in rural and far-flung areas if the country hopes to achieve its economic development goals and social inclusion of all communities.

According to Globe President & CEO Ernest Cu, broadband development is particularly relevant in communities where even basic infrastructure services such as roads and bridges are lacking. “Studies and experience have shown that broadband access creates significant impact on the development of marginal areas as this allows the community to conduct business with people all over the world, get information on education, health and government services,” said Cu.

Telecommunication operators like Globe, however, are unable to deploy infrastructure in rural areas due to business viability issues. “There are a lot of localities in the country that cannot be reached economically. What we propose is for the government to build the infrastructure, such as submarine cables, and then rent these facilities out to telco operators,” he said.

Cu cited the case of Sulu and Basilan provinces in the Autonomous Region for Muslim Mindanao, where Globe was asked to address connectivity issues in the area. To provide adequate connectivity for the area, Globe needed to build a submarine cable system, amounting to US$30- $35 million, a great expense considering the area’s low revenue base.

He emphasized that establishing internet infrastructure should be treated similarly to building roads. He pointed out that unlike private corporations, which need to recover their capital spending within a short period of time, the government can afford a much longer time to recover its investments.

He said the entire country would not be able to optimize the benefits of broadband connectivity unless the government is willing to invest in developing internet infrastructure in “missionary routes”. Globe itself launched early this year a nationwide infrastructure program that would enhance the country’s internet experience within homes and across businesses. According to Globe, bulk of the $750 million capital expenditure that it has set aside for the year would be allotted to deploy fiber optic cables in 20,000 barangays all over the country to provide faster and more reliable internet access in about 2 million homes nationwide. The infrastructure build is expected to take 5 years and will extend network coverage to more areas that currently have no connection or spotty service. Investments relating to its fiber deployment alone could reach up to $2 billion within the 5-year period.

In addition to investments in “missionary routes”, telecommunication operators also need government support in minimizing, if not eliminating bureaucracy, relating to the permitting process for cell sites and rights-of-way for fiber deployment, said Cu, noting that the company needs to secure around 25 permits, spanning around 8 months, to build a single cell site.

Cu emphasized that even as the company recently started using the 700 MHz spectrum, which is seen not only to deliver additional capacity but also enhanced indoor coverage, Globe needs to continuously build cell sites to provide sufficient bandwidth for its customers. According to him, the company is able to deploy only around 450 cell sites a year even as it targets to build roughly around a thousand towers annually. The 700 MHz frequency is considered key in providing greater coverage as it can easily penetrate buildings and walls and has greater coverage with fewer infrastructure needed compared to frequencies on higher bands. Its qualities make it the most valuable frequency range for 4G/LTE technology.