This means promoting broadband to the point of giving telecom companies incentives, including subsidies, to invest in setting up the infrastructure, marketing it with more fervor and pricing it aggressively not just to business but to home consumers.
Building more broadband infrastructure at this time sounds crazy given substantial excess capacity. But as the FCC chairman recently said, increased subscription to broadband seems to be more of a pricing problem.
I watched Michael K. Powell, the chairman of the Federal Communications Commission on C-Span last weekend and he made it clear that the problem does not seem to be that Americans can’t get broadband – but that they won’t, at least not for the prevailing $50 a month.
Powell cited studies by J.P. Morgan and others, and they indicate nearly three-quarters of all US households have access to cable modems, and another 45 percent can get phone-based digital subscriber lines (DSL). But only 12 percent, or just under eight million households, have signed up so far. "Consumers may not yet value the services at the prices they are being offered.’’
The renewed interest in broadband was kindled in the wake of businesses disrupted by air-travel restrictions and anthrax scares. People just don’t want to step on an airplane anymore if they had anything to say about it. In ground zero in New York, the literal destruction of offices made telecommuting not just convenient but a crucial contingency plan in coping with disasters and yes, terrorism.
This means there will be, as the Globe puts it, a markedly increased need for more broadband, the high-speed "always on" Net connections provided by cable modems, telephone digital subscriber lines, or wireless and satellite technology, because telecommuting by dial-up modem is few people’s idea of productivity. Going forward, there are those who say "universal broadband" could be as powerful a stimulus to the 21st century economy as the transcontinental railroads, rural electrification, or interstate highway construction of decades past.
Back here, broadband is only accessible in the main business districts of Makati and Ortigas and the subdivisions adjoining them. Everywhere else, broadband is provided for by cable television companies. But the cable TV guys are too distracted by their weak financial condition to make the proper investments to deliver world class broadband service to their subscribers. Their initial broadband service, Internet access, has received spotty reviews in terms of speed and reliability.
Yet, MegaManila should be an ideal environment to promote the growth of broadband services. Computer ownership is concentrated in the area and the chaotic traffic conditions should make it ideal for people to transact their business on the net.
But it is a chicken and egg situation. Telecom companies are not making the investments necessary for more people outside of Makati and Ortigas to connect to broadband. They doubt the existence of a market that can sustain them and help them make a return on their investments. But unless the service is available, we will never know if the market exists.
Telecom companies here are still reeling from the government induced over investment in setting up landlines that as it turns out, our people cannot afford. They have so much overcapacity, making it difficult for them to service foreign debt that financed the build-up of their networks. Cable companies are burdened by the same foreign debts for network buildup, increased foreign program costs, low subscription rates and a high rate of illegal connections (as much as 40 percent in densely populated areas).
Maybe it is time for government to junk its EO 109 experiment and allow all the telecom players to operate nationwide as provided for in their franchises. This will at least help the most affected players try and unload their excess lines while providing competition to the biggest and healthiest of the players to assure the best consumer service.
Going back to broadband, it could do wonders for us and help get businesses going, at least in the main population centers where computer ownership is concentrated. But as in the US, the telecom companies will have to price it at a level that consumers consider fair. Otherwise, the capital expense in building the network will serve no one any good.
But yes, given that people aren’t too inclined to travel these days, broadband may play a great role in reviving the economy. Or at least, keep it from falling further.
I heard that our officials have finally realized the stupidity of the World Bank imposition but are still gathering enough balls to say so. What I hear is that they will make a counter proposal to equalize the tax on the income of banks from their FCDU and regular books to remove arbitrage opportunity and at same time protect the yield on depositors income. That one sounds logical.
Jack was going to be married to Jill, so his father sat him down for a little fireside chat. He said, "Jack, let me tell you something. On my wedding night in our honeymoon suite, I took off my pants and handed them to your mother, and said, "Here, try these on."
"So, she did and said, ‘These are too big, I can’t wear them.’ So I replied, "Exactly, I wear the pants in this family and I always will." Ever since that night we have never had any problems.
So on his honeymoon Jack takes off his pants and says to Jill, "Here try these on." So she does and says, "These are too large, they don’t fit me."
So Jack says, "Exactly. I wear the pants in this family and I always will, and I don’t want you to ever forget that."
Then Jill takes off her pants and hands them to Jack and says, "Here, you try on mine."
So he does and says, "I can’t get into your pants." So Jill says, "Exactly. And if you don’t change your attitude, you never will."
(Boo Chanco’s e-mail address is bchanco@bayantel.com.ph)