The group asked the NTC to order PLDT to lower the rates it charges to the ISPs to reasonable levels, comparable to the charges of other telephone companies, issue a temporary restraining order to discontinue PLDT’s practice of charging them the foreign current adjustment (FCA) and subscribers investment plan (SIP), and to order PLDT to refund to the ISPs all the excess or illegal amounts collected from them under this predatory pricing scheme.
For its part, PLDT said in a statement that it is not monopolizing the Internet industry and has no intention to do this saying all it wants is to serve its subscribers well. "PLDT is committed to providing the Filipino consumer with the best possible telecommunications service at the best possible price," PLDT spokesperson Butch Jimenez said.
"All our lines or products and services reflect this commitment. We have no intention to kill or monopolize any industry. Our only intention is to serve our subscribers well," he emphasized.
In its eight-page complaint, PISO charged PLDT of engaging in predatory pricing to drive the ISPs out of the market, onerous and discriminatory pricing for its services to ISP customers, and denying other value added services to its network infrastructure.
PLDT charges its ISP customers a total of P3,700 a month for each line an ISP uses to provide Internet service to its customers. The fee is made up of P2,700 a month for each digital line and an average of P1,000 a month for the bandwidth cost for each user. But when PLDT launched its myDSL service, which includes the cost of the phone service, always on connection, unlimited usage and high speed Internet access, it only charged the public P2,500 a month, which is less than the P2,700 that it charges ISPs for an ordinary dial-up line.
"PISO believes that PLDT can only do this if it is cross-subsidizing its myDSL service from the proceeds of its utility operations, and is engaging in discriminatory pricing with respect to the E1R2, bandwidth and leased line services to its ISP customers. In either case, PLDT is violating both Republic Act no. 7925 or the Telecommunications Act and the Revised Penal Code," said PISO president Julia Theresa Yap.
Section 11 of RA 7925 states that "telecommunications entities may offer VAS provided that such VAS services are not cross-subsidized from the proceeds of their utility operations, and that other providers of VAS are not discriminated against in rates nor denied equitable access to their facilities."
On the one hand, Article 186 of the Revised Penal Code penalized "any person who shall enter into any contract... in restraint of trade or commerce or to prevent by artificial means free competition in the market" and "any person who shall monopolize any merchandise or object of trade and commerce... making use of any other article to restrain free competition in the market."
On the issue of discriminatory pricing, PISO noted that PLDT is the only telecom firm that charges ISPs FCA and SIP while other telcos that charge only an installation fee.
PISO also argued that PLDT has denied the PISO members of access to its DSL infrastructure and its VIBE domestic dial up Internet service despite repeated requests for over a year now. "The delay is tantamount to denial of access. To date, we have not received a definitive answer from them nor have there been any indication of such infrastructure being made available to ISPs‚ not affiliated with PLDT," Yap said.
PISO members admitted that they are "worried" about what PLDT might do them considering that the telecom giant is their main supplier. "Filing the complaint puts our business at risk. Yes, they are big and they are already bullying us right now. It is unlikely that they do some underhand tricks but it is very likely though that they may no longer sell lines to us. We may also have problems with our lines, may experience slow speed, or technical problems in our network," Yap added.
The group urged the NTC to immediately order PLDT to desist from continuing with its unfair business practices, stop its policy of predatory pricing for its VAS services, reduce the high and discriminatory prices for the services it provides its ISPs customers, and allow other independent VAS providers to its network infrastructure.
"As the country’s dominant telephone company, PLDT has the most extensive network infrastructure and facilities, a position that it has fully leveraged to financially cripple and limit the expansion of independent ISPs," the group said.