The Internet even slower down South

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The government is working to improve information and communication technology (ICT) in Mindanao, but challenges remain.

In its Philippine Economic Update report published in October, the World Bank said Mindanao continues to lag behind Luzon and Visayas in terms of Internet speed.

One main barrier to ICT development in the region is slow Internet speed, compared to Metro Manila and other developed regions, which also remain below the global average.

In Cagayan de Oro, for example, the recorded speed is 2.4 megabits per second (Mbps), compared to 3.6 Mbps in Makati City. In Marawi City, the recorded speed was a very low 141 kbps.

“It appears that Davao users have to pay about 1.5 times more to get the same speed as in Makati, and Marawi users have to pay 26 times more. A dedicated line can cost up to P20,000 per month for each additional 1 mbps of speed, compared to P700 for a residential line with no speed guarantee,” the World Bank added.

To address this, the Department of Information and Communications Technology (DICT) plans to build 250,000 Wi-Fi access points nationwide, before the end of President Rodrigo R. Duterte’s term in 2022. This is in accordance with  Republic Act No. 10929 governing the Free Internet Access Program, signed by Mr. Duterte in August.

DICT Officer-in-Charge and Undersecretary for Special Concerns Eliseo M. Rio previously said people can connect to the Wi-Fi access points without having to link to congested, limited cell sites. Around 67,000 cell sites are needed to meet the country’s Internet connection needs, but there currently only over 20,000.

The government will bid out the subscription to an Internet service provider (ISP). After three years of contracting with the ISP, the access points will then serve as end points of the National Broadband Network, which aims to provide connections to all government offices, down to the local government units.

“Mindanao will get its fair share of access points. Definitely, all barangays by 2022 will be covered. We’ll have all barangays connected to the Internet. All public places, all parks, where people gather like bus stations, piers, airports will have free Wi-Fi access,” Mr. Rio said in an interview.

DICT said it has completed 86 project sites across 16 provinces, all of which are operational as of Nov. 27.

For Mindanao, the DICT will establish access points in an estimated 11,475 public places by 2022. Every municipality will be covered and there will be a minimum of eight sites per municipality.

However, the DICT will only enter areas where the telecommunications players are not present, particularly in the less developed areas in Mindanao.

The World Bank noted there is lack of incentive for telecommunications firms to invest in remote areas given high capital spending required.

PLDT, Inc. in October completed its the P1-billion expansion of the domestic fiber optic network (DFON) in Mindanao, for what the company says provides more reliable connectivity to its home and enterprise customers.

The fiber optic cable link directly connects the provinces of Agusan to Davao, spanning 230 kilometers. The network runs through four provinces in Mindanao — Agusan del Norte, Agusan del Sur, Davao del Norte and Davao del Sur.

In partnership with the local government of General Santos City, PLDT has also established fiber-to-the-home (FTTH) facilities in General Santos, the first “Fibr City” in Mindanao.

For its part, Globe Telecom, Inc. said it has already deployed around 3,000 long-term evolution (LTE) sites in Mindanao, covering almost 60% of the physical sites in the region. — Patrizia Paola C. Marcelo

Mr. Rio said the DICT’s policy is the government will not try to establish itself as the third telco player, given previous failures, but rather, provide services in areas telcos do not serve.

“Where the telcos do not go, we will enter,” Mr. Rio said in an interview.

Mr. Duterte earlier offered China the “privilege” of being the third telecoms operator in the Philippines, in order to break the long-standing duopoly of PLDT Inc. and Globe Telecom, Inc.

Mr. Rio said on Dec. 20 that companies from Japan, South Korea, Australia, China, and the United States are also interested in entering the Philippine market. The Constitution limits foreign ownership in certain industries, including telecommunications, to only 40%.

For information technology — business process outsourcing (IT-BPO), Davao City has emerged as the primary outsourcing destination in Mindanao. It joined Manila, Cebu, Bacolod and Sta. Rosa as on the list of outsourcing destinations in the Tholons Services Globalization Index for 2017.

As the only city in Mindanao, Davao ranked 85th on the list, down from 69th last year.

With slow Internet a hindrance, another setback is the low level of ICT skills among workers in the region.

Citing a study in 2014 done by the IT and Business Process Association of the Philippines (IBPAP) and TeamAsia, the World Bank said in its report that most applicants in Davao were rejected for lack of both soft and technical skills, resulting in a supply gap of 70% in Davao’s ICT sector and 40% in Davao’s BPO industry.

One way the government is trying to address the shortage of ICT skills in the provinces, including Mindanao, is the implementation of the  Rural Impact Sourcing (RIS) Program. The government says this program “is intended to create meaningful ICT-enabled jobs in socio-economically disadvantaged areas in the country.”

The program’s objectives are to: increase the ICT technical skills of the talents in the countryside; increase hiring potential of the people to land a job in the field of ICT; and promote local talent and local businesses; and enhance the ICT technical skills of in-house participants, like DICT personnel and Tech4ED Center Manager as potential trainers.

The program specifically focuses on areas with high population but low employment due to lack of investors, and It also aims to promote ICT-enabled jobs as an economically viable activity in rural communities that are not yet ready to host Information Technology-Business Process Management (IT-BPM) operations.

The training also targets to provide employment opportunities, particularly for micro small medium enterprises (MSMEs).

In the conduct of these trainings, special technology empowerment for economic development (Tech4Ed) Centers will be established and utilized to serve as training centers in selected communities.

The Tech4ED Centers are shared facilities that provide access to ICT-enabled contents and services. These centers also serve as RIS hubs where beneficiaries, after the training, can do jobs online with its free facilities.

The DICT said it has conducted seven RIS Advocacy Workshops, which promote the RIS training, conducted in Tagum City in Davao del Norte, City, Mati City in Davao Oriental, Sindayan in Zamboanga del Norte, Tawi-Tawi Province, Bislig in Surigao del Sur, San Jose in Dinagat Island Province, and Nabunturan in Compostela Valley. Two more are expected to be completed in Digos, Davao del Sur, and Basilan province.

The Tech4Ed centers aimed to provide ICT services for education, employment, and entrepreneurship. “These are small BPOs [business process outsourcing] [centers] spread throughout the country especially in rural areas,” Mr. Rio said.

For Tech4Ed, 588 centers have been established, composed of 19 library partners, 295 school partners, 48 national government agency partners, 29 private partners.

The goal for next year is to establish another 316 centers, 263 of which will be established with equipment donation, while 53 will be hosted by partners; three training centers; and eight Tech4ED-RIS hubs.

With the continued rollout of programs by the DICT, particularly in skills training, the outlook for ICT in Mindanao is much brighter.

However, much of the potential remains to be seen, particularly in opening the market, which can deliver more options, healthy competition, and better services, particularly in Mindanao.

Providing cost-effective Internet connection can — just as with the rest of the country — foster economic development in particular in Mindanao.

It remains to be seen whether the Duterte government can maximize the opportunity and bring development in the island where he promised change and prosperity. — Patrizia Paola C. Marcelo