Philippines: Capturing the Broadband Satellite Opportunity

August 28, 2019

By Leo Carlo Liay

It’s a 45-minute drive on unpaved roads from Barangay Mabunao to Panabo, a small Philippine city in the southern province of Davao del Norte. The round trip costs “Joy” (not her real name) about US$2.00—25 percent of her daily income—just to get somewhere where she has access to a fast, reliable internet connection. But at that price, she mostly stays home, where she must bear with the sluggish, unreliable connections in her own barangay (village).

Joy is 24 years old and, like most of her generation, a digital native. She relies on social media for information. She follows current events around the globe on her mobile phone. But the poor connectivity in her remote district of Mabunao means Joy’s window to the world is a small one.

A glimpse of the remote district of Mabunao and the unpaved road leading to Panabo City.

Despite being home to the world’s most active population of social media users, and having the fastest-growing information technology and business-process outsourcing industry, the Philippines has an internet problem that threatens the country’s economic progress. The Philippines is an archipelago of 7,600 islands, which makes communications infrastructure a costly investment, and internet access points are distributed unevenly across the country. Filipinos rely almost entirely on two main telecommunications companies for internet access, and this duopoly keeps prices high and quality low.

A cell tower rising alongside palm trees in Panabo City.

Remarkably for a nation that’s mad for mobile and loves social media, almost 45 percent of Filipino citizens and 74 percent of public schools lack internet access altogether. Better internet coverage throughout the nation would reduce isolation and improve economic opportunities for those residing in peripheral areas. But following a simple calculus of cost-effectiveness, the nation’s communications duopoly has limited cellular infrastructure to where the most people are, in the cities. People in remote, rural areas remain unconnected.

Mobile user taking advantage of the faster and more reliable Internet connection in the urban area of Metro Manila.

In 2016, two organizations, the Internet Society–Philippine Chapter and Democracy.net.ph, led the formation of a multisectoral coalition, the Better Broadband Alliance (BBA), to focus on improving the state of the country’s internet services. The BBA became the biggest civil society voice in ICT policy. Coalitions for Change, a program of The Asia Foundation and the Australian government, supported the BBA through research collaborations on ICT policy and emerging technologies.

Among the reforms that the BBA explored were changes to a single clause in the nation’s telecommunications policy that would reclassify broadband services utilizing satellites and other emerging internet technologies as “value-added” services instead of “basic telecommunications” services. This simple adjustment would free broadband companies using these new technologies from the tedious requirement of obtaining a congressional franchise, and jump-start competition in the broadband sector. Startups and small enterprises would be able to enter the internet market without the expensive bureaucratic overhead.

As their policy research continued, the BBA saw an opportunity to support the roll-out of the government’s nationwide Free Public Wi-Fi program, which had been struggling despite a budget of PHP 3 billion (USD 59 million), by making “internet connectivity via satellites and emerging internet technologies” part of legislation for the National Broadband Plan.

In 2017, the appointment of Eliseo Rio as acting secretary of the Department of Information and Communications Technology (DICT) boosted the chances of reform. Known as proactive and reform minded, Rio endorsed the proposed changes to the Free Public Wi-Fi project, a key program of the DICT under the current administration.

The legislature was also becoming increasingly sympathetic. The BBA had been pushing for a provision to democratize access to satellites and emerging internet technologies, and when the free wi-fi bill reached the bicameral conference committee level, the House of Representatives and the Senate both adopted the recommendation. The Free Internet Access in Public Places Act (Republic Act 10929) became law, with the emerging-technology provision in place, in August 2017.

The new law had an immediate impact on the Free Public Wi-Fi program, now known as Pipol Konek. According to data from DICT, the program installed more than three times as many access points in the 24 months after the law was passed as it had in the previous 32 months under the old Free Public Wi-Fi project—an increase from 807 installations to 2,708 in just two-thirds the time. Remote and impoverished municipalities such as Simunul, Tawi-Tawi, and San Jose, on the Dinagatan Islands, could now access the internet, via satellite, for the first time. Even Pag-asa Island, the largest Philippine-administered island of the internationally disputed Spratly group, was introduced to free wireless internet last July.

Satellite technology provides the remote Mabunao National High School with free internet connection.

In 2017, in The Evolving Role of Satellite Networks in Rural and Remote Broadband Access, the OECD wrote: “Governmental policy in a number of countries has acknowledged the role that satellite could play to connect rural and remote areas, and many have incorporated subsidies for satellite service in their national broadband plans. Strides have also been made to reduce the regulatory burden on satellite broadband providers….”

It is safe to say that the Philippines is now among those countries that recognize the power and importance of satellite broadband.

Internet Service Provider (ISP) operators installing a broadband satellite system for a Free Public Wi-Fi hotspot in Mabunao, Philippines.

Thanks to the 2017 law, the Pipol Konek project is now rolling out free public wi-fi hotspots across the country using satellite technology. Residents of the Philippines’ far-flung and less-developed areas can now access reliable internet for free, with all the potentially life-changing possibilities that entails. Better livelihoods, education, and communication are just a few of the anticipated outcomes of the thriving Pipol Konek free wi-fi program.

Leo Carlo Liay is an assistant program officer for The Asia Foundation in the Philippines. He can be reached at leocarlo.liay@asiafoundation.org. The views and opinions expressed here are those of the author, not those of The Asia Foundation.

*This post has been updated to reflect current information

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