Telcos: Yes to broadband cap, no to minimum speed
Posted on 10 Jan 2011 at 12:02am
As the National Telecommunications Commission (NTC) prepares to hold a public hearing on the controversial broadband volume cap on Tuesday, a group composed of the country’s biggest telcos has declared that it supports the proposed circular limiting the data volume usage of broadband subscribers but it is against requiring a minimum broadband speed.
The position of the Philippine Chamber of Telecommunications Operators (PCTO) appears contrary to the intent of the NTC draft circular which is aimed at putting a cap on broadband data volume in order that telecom firms can be compelled to set a minimum broadband speed.
PCTO, which is currently being headed by former Globe legal counsel Rodolfo Salalima, is comprised of industry bigwigs Smart Communications and PLDT, Globe Telecom, Digitel, Bayan Telecommunications, Capwire, and Eastern Telecoms, among others.
In a position paper it submitted to the NTC last December, the telco group pointed out that broadband access is classified as value-added service (VAS) and is therefore deregulated.
“Requiring a minimum connection speed, service reliability, service level, and service rates would mean regulating it, contrary to the Commission’s (NTC) own rules,” the PCTO emphasized.
PCTO suggested that the NTC retain the present set-up where no minimum service standard is required. “Regulatory compulsion should give way to dynamics of free market where users are left to choose the provider that can best service their price, quality, and service reliability requirements,” it said.
The organization also said that specifying a minimum speed for broadband is not a global standard practice. “Due to the unexpectedly heavy volume of users, there is understandably no guarantee as to minimum connection speeds. That is the reason why global industry practice specifies a maximum data connection rate for ‘best efforts’ services but not a minimum,” it said.
To argue its point, the PCTO said a recent analysis showed that only 5 to 7 percent of abusive users hog 80 percent of the available bandwidth, leaving only 20 percent of the capacity to be shared by 93 percent to 95 percent of the remaining users.
“Hence, in all broadband markets, a Fair Use Policy enforcement, rather than a compulsory minimum grade of service, has been the norm,” the group said.
This policy, it said, guarantees that abusive consumers of broadband service do not monopolize the available capacity to the detriment of other paying customers.
As the broadband market is highly competitive, the group said there is no need for service providers to specify a minimum broadband/Internet connection speed.
“Customers with more exacting requirements who wish to avail themselves of broadband services with a minimum guaranteed connection rate can subscribe to other service plans which the network providers are able to provide to offer including a CIR (Committed Information Rate) service,” it said.