Digitel One earmarks P1-B for next year’s infra projects

Gokongwei-owned Digitel One is allocating at least P1 billion next year to finance its infrastructure projects as the company positions itself to become one of the leading suppliers of bandwidth capacity in the country.

This, as Digitel One managing director Brian Go revealed that their $35-40 million Luzon-wide fiber-optic backbone project, covering more than 1,000 kilometers, will be partly available by March next year to provide high-speed Internet access to local companies, including other carriers and Internet service providers (ISPs).

At around the same time, the $30-million joint venture between Digital Telecommunications and Asia Global Crossing called "Digitel Crossing," which will provide international connections via a submarine fiber optic cable, will start operations.

Digitel and Asia Global Crossing were supposed to have Broadband Infrastructure Inc. (BI) as partner, but due to problems on the infusion of committed funds, BI was taken out of the project.

"The two just decided to take over from where BI left. Anyway, Digitel has its own technical expertise," Go said.

Go revealed that Digitel One, the data company of the JG Summit Group, is setting aside P1 billion for next year, or about the same level as this year, already fully funded via a combination of loans and equity.

He noted that since the company started with a small base in 1999, its revenues have more than doubled last year. "We are hopeful that we will be able to do the same this year," he said.

One of the company’s major projects is the Luzon-wide backbone, parts of which will be available in March, especially the one that will service Makati.

The project is currently designed for 2.5 gigabits capacity but according to Go, the DWDM technology that is being used allows it to be easily upgraded to 10 gigabits and more simply by installing additional cables

Go said the fiber optic backbone will also support the broadband wireless data requirements of the GSM network which Digitel is putting up.

Digitel will be the sixth telecommunications company to join the highly competitive cellular mobile telephone system (CMTS) business. Its officials expect to start commercial CMTS operations in the first half of next year.

Other players include Globe Telecom, Smart Communications, Isla Communications (Islacom) and Pilipino Telephone Inc. (Piltel), all offering the digital or GSM wireless technology. The fifth player, Extelcom, continues to offer analog technology but has plans of upgrading to digital in the near future.

Bayan Telecommunications of the Lopez Group was able to secure a provisional authority to offer CMTS, but was stopped by the Supreme Court from doing so. The case is now under appeal.

Right now, telecommunications companies are in the forefront of bringing broadband access. "I believe that it is good because it opens up the market to competition, which will result in more capacity and lower prices," Go said.

He remains optimistic that despite the number of new entrants into the business, there is still room considering the growing demand.