China Telecom picked to become the Philippines' third telecoms player
Beijing has selected China Telecom, the country’s biggest fixed-line network operator and third-largest mobile services provider, to invest in the Philippines, according to the Duterte administration.
China Telecom Corp could become the Philippines’ third nationwide telecommunications operator, officials of the Southeast Asian country said on Sunday, as the government sought to stir up competition to boost notoriously poor fixed-line broadband and mobile network operations.
Philippines President Rodrigo Duterte last month offered China the “privilege” of challenging a long-standing duopoly that has frustrated consumers because of slow and intermittent internet and mobile phone services.
“The Chinese government selected China Telecom to invest in the Philippines upon invitation by President Duterte during the bilateral meeting last November 16,” said Eliseo Rio, secretary of the Department of Information and Communications Technology.
Chinese companies, however, could not operate alone in the Philippines and would need to partner with a local company.
The government is now looking at who will partner with the state-run China Telecom on a 60-40 basis, Rio said.
The Philippine Constitution’s 40 per cent cap on foreign ownership of domestic telecommunications companies has kept interest from multinationals at bay in the market of more than 100 million people.
Hong Kong-listed China Telecom should partner with a reputable Philippines company with an existing telecommunications franchise, according to Presidential Communications Secretary Martin Andanar.
“The government is fast-tracking this because consumers are getting annoyed with dropped calls and slow internet connections,” Andanar said in a radio interview on Sunday.
Also seeking to be a major player is broadband internet service provider Philippine Telegraph & Telephone Corp, which had said it was talking with China Telecom and state-owned Datang Telecom Group about strategic partnerships to challenge the nation’s dominant duo of PLDT and Globe Telecom.
With 244.8 million mobile subscribers as of October, China Telecom is currently ranked as the world’s seventh largest mobile network operator. The company, which posted total revenue of 325.3 billion yuan (US$49 billion) last year, is also China’s biggest fixed-line network services provider.