Ray C. Espinosa, PLDT director and head of Regulatory and Policy Affair, said the deal with Digitel, which operates Sun Cellular, is viewed by many as the start of the restoration of monopoly in the country.
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But Espinosa said this is simply wrong.
He said the deal will surely enhance PLDT's market position but by no means will the transaction make PLDT the only player in town.
"Despite Globe's warnings of dark days ahead, Globe remains a strong competitor. And yet the San Miguel Group has been very vocal about its plans to join the fray. These are both capable and well-established business groups with well-funded foreign partners. It would be foolish for PLDT to expect competition to weaken," Espinosa said in a letter sent to Sun.Star Cagayan de Oro, issued after months of silence.
For the past months after the successful PLDT-Digitel deal, Globe Telecommunications had been vocally objecting the idea of the merger, citing this would result to monopoly and would completely erase them in the market.
Espinosa said PLDT already expected for the telecom industry in the country to remain very competitive as it was even before the entry of Digitel that the consumers will continue to benefit from the rivalry.
He also emphasized how the competitive landscape in the telecom industry is being reshaped by global internet players, such as the likes of Skype, Google, Yahoo and Facebook.
"These internet players offer communications services such as voice calls and instant messaging that directly compete with those of telcos. Skype, for example, is already the world's largest carrier of international voice calls even though it does not own a network. And Facebook has over 23 million subscribers in the Philippines," Espinosa said.
He said the competition in the web is bound to grow because telcos like Globe and San Miguel are all rolling out broadband internet services, thus giving more people greater access to competing services offered by internet players.
"We telcos are creating the highways for competition and we are facilitating the growth of competition within the telecommunications industry," Espinosa said.
He said they did not get 70 percent of telecom frequencies when they acquired Digitel but as a result of its investment, Smart and Sun Cellular combined will have more frequencies than Globe, with 155 Mhz for Smart and Sun versus 90 Mhz for Globe.
"But the higher frequency is not surprising considering that with our new tandem combined as of the end of 2010, our number of subscribers had more than doubled compared with Globe. In short, we have more frequencies because we have more subscribers," Espinosa said.
He said their rival's opposition to the deal is not based on principle or out of concern for consumers' interest.
In the name of seeking a "level playing field," he said it is holding hostage the Digitel deal so that it can extract special privileges from the government.
Espinosa made it clear that they had consistently maintained PLDT's investment in Digitel that should be assessed from the standpoint of consumers who will benefit from higher quality, more extensive and affordable services with PLDT/Smart and Digitel/Sun's effectively combined network resources.
