Dito's franchise renewal bill clears Senate hurdle
MANILA, Philippines — Dito Telecommunity’s bid for an extension of its legislative license to operate cleared the Senate on Wednesday, helping ensure that the third telco’s nascent commercial operations won’t be thrown off track.
Voting 17-2, with one abstention, the Senate approved on third and final reading House Bill 7332 that seeks to renew Dito’s 25-year legislative franchise under its old name, Mindanao Islamic Telephone Company (Mislatel).
Legislators voted after trading hours. Shares at Dito CME Holdings Inc., which has indirect stake at Dito, went down 0.41% to close at P9.80 each on Wednesday.
Mislatel acts as the franchise holder for Dito, the 60-40 joint venture between Davao-based tycoon Dennis Uy and state-owned China Telecommunications Corp. Granted in April 1998, Mislatel’s current franchise would have expired in 2023 if were not extended.
The bill is highly likely to win approval from President Rodrigo Duterte, whose presidential campaign during the 2016 elections was partly bankrolled by Uy. Once the bill is enacted, Dito will be allowed to operate until 2048.
At the onset however, a fresh license would help ensure that Dito’s rollout will not get hampered. The newbie telco started offering services in 15 cities and municipalities in the Visayas and Mindanao last March 8, and is planning to expand that to Metro Manila and Luzon next quarter.
At the Senate, only opposition senators Francis “Kiko” Pangilinan and Risa Hontiveros thumbed down the franchise bill, citing their repeated concerns that China may use Dito as a vehicle to steal state secrets.
Senator Panfilo Lacson did not take part in the voting.
“In this bill we are deciding on two competing yet vital interests: the welfare of our consumers who have had to endure less than ideal service so far on one hand and national security on the other,” Hontiveros, explaining her “no” vote, said.
“We welcome more competition in the telecommunications sector... however, this should not come at the expense of vital national security interests,” she added.
Pangilinan agreed with Hontiveros. “We cannot close our eyes to the national security issues as well as the threats to our sovereignty surrounding this telco,” he said.
Already, Dito has signed interconnection deals with competitors Globe Telecom Inc. and PLDT Inc. so that subscribers from the three networks can contact each other. Telco towers, including those in military camps that also came under scrutiny, are also being put up to enhance service.
Dito passed its first government-mandated assessment prior to its rollout, under which the telco surpassed the minimum required broadband speed of 27 Mbps and coverage of 37% of the population. The second test will be held in July, when the telco should have boosted speed to at least 55 Mbps and expanded coverage to 51% of population.
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