Press Release
March 10, 2021

Senate Committee on Public Services


Atty. Adel Tamano: In the one day that we had, one full day that we have had the commercial rollout in the 15 cities in Mindanao and Visayas, we have a total signup of 22,748 persons. This is the online signup. The qualified, meaning those who have compatible phones in the proper areas were 6,597, which is nearly 30 percent of the total online signups. Now adding to this, the SIM purchases from our partner stores, and from other digital channels, as of March 9, 11:59 p.m., we have a total of 7,586 in terms of subscribers. Of course, that number is increasing as we speak, because of the online and the other outlets that we have. In regard with the rollout, Your Honors, perhaps General Santiago if you'd like to give an update.

Gen. Rodolfo Santiago: For the rollout to meet our second-year commitment by July of 2021. We are confident, Ma'am, that we can meet the population coverage required of us of 51 percent, because right now we're nearing 45-percent population coverage. And that we are very aggressive in our five-year rollout, that would allow us to maintain the 55 mbps minimum average broadband speed.

Sen. Grace Poe: So, basically what you're saying, Mr. Santiago, is that you've actually surpassed the 37-percent coverage that you initially committed to, am I correct?

Santiago: Yes, Ma'am, for our first-year commitment. What we have sent, reported to NTC is the 37.48-percent population coverage to meet our first-year commitment. However, in our internal simulation conducted, after the testing where we determined that we're more than 40 percent already and right now we are approaching the 45-percent population coverage.

Poe: Well that's good news. About my question on compatibility with the different phones? What's the issue there? Why can't you be compatible with all types of phones?

Santiago: I should clarify that the compatibility list, those models that were included in our compatibility list, have undergone a collaborative, meaning, with the manufacturers, a collaborative test of their compatibility to our network. And because this is collaborative. We are assured that the manufacturers are confident that the brands that have undergone this testing are 100-percent compatible.

Poe: Okay, I see the hand of Engineer Galla, do you have a comment on that?

Eng. Pierre Tito Galla: Yes, Ma'am. I'm actually surprised that Dito Telecommunity restricted their list. I mean it's a pretty restrictive list on their website with regard to what phones are compatible. The reason why there is this question with regard to compatibility is because of the type of frequencies that were licensed to Dito Telecommunity. They do not have 900 megahertz. They do not have 1800 megahertz. And these are the workhorse frequencies for 2G. What they do have are frequencies for 3G, LTE, 4G and 5G, 3500 megahertz they have that already. Now, phones that are older than 2014-2015 about that time will probably not be compatible with these smartphones because they do not carry a technology known as voice over LTE, but phones that are the smartphones that are newer now have that technology so there's really not much to worry about. What we need to worry about, however, is that the feature phone market in the Philippines, meaning they are not smartphones is still very high in the country. And typically, they only have lalo na yung mga those used by our kababayans who are socio-economic class D and E. These are the dumb phones, the feature phones that only run on 2G frequencies. So they are about 60 percent of our population. We cannot expect them to be able to access the frequencies and technology that were licensed to Dito Telecommunity. So, to your question, Ma'am, about compatibility it's nothing to worry about if you're using a smartphone. But if you're not using a smartphone then there's an issue there.

Poe: How would you rectify that because you know when you speak of underserved and unserved areas, a lot of those belong to a demographic that might not be able to afford a smartphone. So how do you plan to provide service in those areas if their phones aren't compatible? So do we end there? Engineer Galla again?

Galla: Unfortunately, that cannot be answered by Dito Telecommunity for as long as Globe and Smart, essentially a duopoly over 900 and 1800 megahertz. And as I've informed the Chair, so many times before, until we have spectrum management reform that means that the NTC will be able to claw back, and then reassign for frequencies to be more equitably assigned to those who will use them, we will remain in the situation. So that's a matter for a lot of reforms down the line that the Chair is aware of.

Poe: But how much now is the most, or maybe the cheapest smartphone that maybe compatible with Dito?

Galla: Off the top of my head, Ma'am. There's already some in the, I'm speaking, Ma'am, as somebody who sometimes assembles his own cell phones. You can get one for approximately, P2,000-P3,000, even less. The technology is getting cheaper by the day. So that if perhaps Dito Telecommunity will review some of the subsidized programs that they have deployed in India by Reliance Geo or by DTAC in Thailand, they can probably offer it cheap.

Poe: Okay, I understand what you're saying, this is a whole range of reforms that needs to be undertaken. But we don't want to punish a company who's coming in, without the same pool of resources as the other ones. So, yes, you're right, it could be probably a subsidized partnership. We have Cherry Mobile on one of the stock companies that are less expensive but let's say those with an iPhone, because I don't think you mentioned it as part of the ones that are available, would they be able to use Dito?

Galla: I believe the iPhone can, there's nothing stopping an iPhone user from using their technologies, in fact, the iPhone of two generations ago was already ready for the frequencies and the technology that's been because it...

Poe: Hindi kasi doon sa listahan ng Dito, I don't think they mentioned the Apple gadgets.

Galla: I don't know why they made it restrictive.

Tamano: If we may. That is only just a partial list, and the reasoning behind it, that General Santiago will give the technical reason. But the more commercial reason is because we want to protect the consumers from not wasting their money. We don't want them to waste their money by our SIMs, by our services, and they cannot fully utilize their phones, because of phone compatibility. The partial list that we have provided, are these phones in which we as a company have had extensive testing as well as coordination with handset manufacturers. So, we optimize the use of the Dito phone.

Santiago: Ma'am, 'yun pong compatibility list namin, it is a list sabi ko nga po kanina that those that have undergone a collaborative test with the manufacturers to provide both the manufacturer and Dito the confidence that there will be no technical issue if a subscriber will use those phones. 'Yung pong wala sa list hindi po natin sinasabi that they're not compatible. But what we're saying is that hindi po ito nag-undergo ng collaborative tests with the manufacturer and therefore, to protect the public there may be technical issues that are unforeseen. We just wanted to say na nag-a-undergo pa rin kami ng collaborative testing para ma-expand yung mga models na nandun po sa compatibility list.

Poe: Okay, as long as we know that's open-ended and doesn't mean that if they're not the primary list, it's not compatible. Now, is it true? Well, if I want to get a Dito SIM, where can I get it?

Tamano: There are two ways to get it, Your Honor. First, offline, meaning to go to one of the currently, one of the 10 outlets that are open in Visayas and Mindanao or through online. Now we encourage online, of course, because online, we go through a series of questions in order to find out, number one is your phone compatible; number two, is your phone SIM lock; number three, is your phone blacklisted; and number four, whether or not you are in the 15 cities that are part of the commercial launch.

Poe: You can do it online.

Atty. Tamano: We are actually encouraging people to do it online.

Poe: Do you have it in SM outlets?

Atty. Tamano: Yes, I can provide the 10 outlets in which they are available, Your Honors

Poe: When you say that it's available in SM, it's actually your Dito physical store, am I correct?

Atty. Tamano: No, these are our handset partners. So, we will be having the Dito signature stores opened perhaps in a month or so.

Poe: What do you mean by handset partners, let's say Samsung, ganun?

Atty. Tamano: Yes, those would be.

Poe: Okay so, but it's only the Samsung being sold in SM, how about in the other malls?

Atty. Tamano: Well, right now these are the 10 partner stores in which it's available. I can provide the list if you would like I can read it.

Poe: Can you read them quickly?

Atty. Tamano: Your Honor, in Visayas, it is available in SM Consolacion. It's also available in SM City Cebu, in Gaisano Grand Mandaue Center, in SM City Cebu, and also Ayala center Cebu Business Park. In Mindanao, it is available in Gaisano Mall of of Davao, as well as SM Ecoland and City Mall, Your Honor.

Poe: Okay, that's good. At least you know, there are different outlets and not just one company. One type of company.


Poe: For Dito, what is your debt-to-equity ratio now?

Tamano: Your Honors, we have, we can present that if you'd like us to present the debt-to-equity ratio.

Poe: Can't you just say what it is?

Tamano: It's... 77 percent to 23 percent. For this type of industry, Your Honor, which is capex-intensive, that's quite a healthy standard.

Poe: So your debt is about 77 percent and then about 23 percent is your equity?

Tamano: Yes, Your Honor.

Poe: Well, I know that this is capital-intensive but earlier Commissioner Cordoba is requiring a different ratio for the broadcast industries. So, Mr. Cordoba do you we have an exception when it comes that?

NTC Comm. Cordoba: Your Honors, I think maybe Attorney Tamano is stating their current equity. What we have is the, they submitted po kasi every April so what we have is their 2019 debt equity. We're still going to receive the 2020 debt equity. As of 2019 their debt-to-equity ratio is 8.02 percent to 91.98 percent so maybe they can improve before they submit to us, Your Honors.

Poe: Oh, so last year eight percent lang ang debt nila?

Cordoba: Ano po ito as 2019 audited financial statements which we received 2020 and then 'yun pong 2020 they will have submitted this 2021?

Poe: Because the reason for that, obviously they use that capital to be able to roll out...

Cordoba: Tama po kayo 8.02 percent to 91.98 percent.



Sen. Grace Poe: Let me go through the checklist of Dito. I want you to confirm if they've actually delivered on that...They said double download speeds by one year of operations and quadruple it by year 2 and achieve 84-percent population coverage by 2025. I know... we're moving too much ahead of this commitment schedule, but are they on track to be able to deliver that or if not what are the obstacles?

Manabat: Yes, Your Honor. So we can only provide in terms of the result or the actual findings based on the one-year audit, and as mentioned by Depcom, they were able to meet the committed level of service specifically on national population coverage and the minimum broadband speed.

Poe: Okay, so... here it is... 37.3 percent of the population coverage. They said they surpassed that, am I correct?

Manabat: The one in the memorandum circular, Your Honor, will be 37.03 percent to be exact, and they were able to achieve 37.48 percent and that's also based on the Form A that they have submitted to NTC.

Poe: Okay, next. Minimum average broadband speed of 27 mbps, were they able to reach that?

Manabat: Yes, Your Honor. So we covered 4G and 5G pursuant as well to the CTCN and the coverage for this test, so they were able to achieve 85.9 mbps for 4G and 507.5 mbps for 5G side.

Poe: Their operation expense... in billions is about P150 billion? Did you cover this in your audit report?

Manabat: Not on this year of test, Madam Chair, because they are not commercially live yet, and the only level of service for year 1 are the two: national population coverage and the minimum average broadband speed. So that will be subject in future audit.



Poe: When we talk about the deliverables it seems that... Dito Telecommunity has actually delivered... so when I defend this franchise before the body, I can say that this was also actually audited by an independent advocacy group, hindi lamang NTC at 'yung auditor hired by Dito.


Poe: To Dito and all other franchises, congratulations. The hearing is now adjourned...

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