NTC sets for June 2001 bidding for 3G frequencies

The National Telecommunications Commission (NTC) has scheduled for June next year the bidding for the frequencies needed to engage in third generation (3G) mobile telecommunications.

This was learned even as an inter-agency body created by President Estrada to formulate the guidelines necessary to bid out frequencies has yet to issue the rules, which are supposed to be out by year-end.

The body is composed of the NTC commissioner, a representative from the Department of Transportation and Communications and one from the Economic Coordinating Council. "The problem is we have not yet convened. The DOTC and ECC have yet to name their representatives," NTC Commissioner Joseph Santiago told The STAR.

Aside from 3G, the inter-agency body also has to come up with the list of other frequencies to be bidded out.

Meanwhile, Santiago said that they still have to decide on how much the floor price for the bidding would be, but said they have to look at the European and American models.

The NTC is also looking at the possibility of bidding out channels or bidding out lots of 10 megahertz each (each having several channels) in the 1950-1980 and 2140-2170 Mhz band. Earlier, NTC Deputy Commissioner Nestor Dacanay said they are studying whether to limit the bidding to two or three bidders or not.

When asked to comment on an industry estimate that the floor price will be around $1 million per megahertz, he said that figure is too small. "We have to decide on an amount that will be favorable to government and at the same time, reasonable to the bidders," he said.

This is expected to raise a howl among local telecom companies which already feel that the $1 million per megahertz price is already too much.

Whether the bidding will be successful or not, however, depends largely on how 3G will perform in other countries. In Europe, telecommunications companies paid $120 billion for 3G licenses and another $80 billion for infrastructure.

But Santiago felt that the prices in Europe were simply too much such that their telcos are now having a hard time recovering the costs (since not all can be passed on to the consumers).

Although 3G will only be commercially available in 2002, this early telecommunications companies worldwide are betting as to its commercial success. Right now, what is being offered is the second generation (2G) mobile telecommunications or what is more popularly known as GSM (global systems for mobile communications) which allows text messaging.

Next year, local cellular companies will start offering the 2.5 G known as GPRS (general packet radio service) which allows a cellular phone user to be connected to the Internet all the time without the need to dial-up.

3G takes GPRS one step further in the sense that it sends and receives data faster (up to two gigabits per second) and allows wireless video transmissions. But like GPRS, 3G will require a different type of handset.

One of the technologies which was considered worldwide as pure marketing hypes was the wireless application protocol (WAP), which promised instant access to the Internet. However, since a user still has to dial-up to a number that relies on copper wires, accessing wireless Internet through WAP was as difficult as getting one’s own PC connected to the Web.