Digitel enters into P1.35-B joint venture project

The amount could have easily reached billions of dollars, however, were it not for the existing infrastructure of Asia Global and Digitel. The partnership, however, is only one phase of Asia Global’s plan for the Philippines. Including two other phases, which may or may not involve Digitel, the investment could easily reach tens of billions of dollars.

With the creation of the new venture Digitel Crossing, Digitel will now be part of the pioneering effort in making the Philippines part of the international broadband arena, according to Lance Gokongwei, president of Digitel’s data subsidiary DigitelOne.

Whatever international broadband capacity Digitel Crossing will generate, will be sold to other telecommunications companies, including DigitelOne, Internet service providers, and other users. This is because the new joint venture still does not have the capacity to do last-mile connectivity to the user.

"Together with our Luzon-wide broadband backbone, this joint venture will help spur widespread Internet and highspeed data usage and familiarity around the country, Gokongwei said.

He added that with the exciting prospects of riding the worldwide network of parent Global Crossing, the Philippine venture will be unparalleled access to the most important countries and cities in the world. "This seamless connectivity at competitive prices will contribute in a significant way to the IT business and broadband growth in the Philippines."

The new venture will connect Digitel’s state-of-the-art network with Asia Global Crossing’s pan-Asian network.

The submarine cable is presently under construction, and Gokongwei said he expects the building of landing cable stations and connection to the telehouse to be ready by the first or second quarter of 2002. ‘In the meantime, we are trying to get all the necessary permits and franchises, including government incentives," he said.

Asia Global Crossing has a 40 percent stake in the joint venture, with Digitel having 40 percent, and BI Group, 20 percent.

The terrestrial fiber optic backhaul network will connect with Asia Global Crossing’s subsea East Asia Crossing fiber optic system which cost $1.4 billion when it lands in the Philippines in the first half of 2002, bringing the country pan-Asian connectivity.

Upon completion, East Asia Crossing will be the first truly pan-Asian system, linking Japan, Hong Kong, Taiwan, Korea, Singapore, the Philippines, Malaysia, and as regulations permit, China, on one seamless network.

"Since the Asia Global Crossing and Global Crossing Networks have been designed as a single autonomous system, users in the Philippines can expect faster Internet access speeds at a more competitive price," John Legere, president and chief executive officer of Asia Global, said.

Asia Global Crossing is a public company whose largest shareholders include Global Crossing, Softbank, and Microsoft, and provides the Asia-Pacific region with a full range of integrated telecommunications and Internet Protocol (IP) services.

Through a combination of undersea cables, terrestial networks, city fiber rings and complex web hosting data centers, Asia Global is building one of the first truly pan-Asian networks which will provide the Asia Pacific region with seamless access to major business centers worldwide. As part of its strategy to provide city-to-city connectivity, Asia Global partners with leading companies in each country it connects to provide backhaul networks.

The BI group, which is an international telecommunications-focused investment and holding company, has been tasked to manage the installation of the infrastructure, implement the backhaul network, and to participate in the development of the telehouse for Digitel Crossing.