Broadband Service: Utility Or VAS?

The National Telecommunications Commission (NTC) last week said that broadband services can be regulated, notwithstanding provisions in the law saying that value-added services (VAS) are deregulated. “When it comes to broadband services, whether or not it is VAS or a basic service, it can be regulated. That’s why we are discussing these circulars,” said Edgardo Cabarrios, Director of NTC Common Carrier and Authorization Division, at the public consultation on minimum broadband speeds in Baguio on March 18. Cabarrios further clarified that so long as there are steps by telecommunication firms that can directly affect the public, the NTC can step in and regulate the market.

The statement was met positively by industry observers who have been hoping that the NTC would step in to ensure that telecommunications companies (telcos) deliver consistent and reliable broadband Internet service to the public. However, this goes against earlier statements made by the NTC during its initial consultations in Manila that VAS —under which broadband services are claimed to fall under— are deregulated and, as such, telcos are free to impose their own regulations independent of the NTC.

I personally believe that the telcos would not take this pronouncement of NTC sitting down. We can expect them to file a case against the regulatory body all the way to the Supreme Court. In the meantime, the big question will be . . . Will the telcos follow the memorandum circular that NTC will come up regarding the minimum broadband speed that they offer to the public?