Globe prods DOJ to take cue from AT&T deal

GLOBE Telecom Inc. wants the Department of Justice to follow the lead of its US counterpart and block a planned merger between PLDT and Digitel that would create a monopoly in the Philippines' near maturing telecom market. "Government intervention is necessary to ensure that there is a level playing field and allow healthy competition to boost the quality of services for the benefit of consumers," the Ayala-led telecom company said in a statement sent over the weekend. Globe's statement came on the heels of the US Justice Department's antitrust lawsuit against AT&T, which is purchasing T-Mobile USA for $39 billion in what industry pundits said was raising the stakes in antitrust jurisprudence. Globe said this development is a welcome input to the Aquino administration's strong anti-monopoly stance, which the telco said was aligned with the President's "matuwid na daan" or straight path approach to issues involving corruption and the protection and promotion of public interest. Globe said the AT&T-T-Mobile merger, which is under review by the Federal Communications Commission, bears a striking resemblance to the PLDT-Digitel merger, which is likewise under review by the Philippines' National Telecommunications Commission. Its acquisition of third-ranked Digital Telecommunications Philippines Inc. will give Philippine Long Distance Telephone Co. 70 percent of the total market and excess frequencies at a ratio of 4.5:1 vis-a-vis second-ranked Globe. AT&T is accused of "hoarding spectrum", as it sits on top of a 700 megahertz spectrum acquired in 2008 and its Advanced Wireless Services spectrum to roll out 4G LTE service. AT&T is said to be planning to cover 97 percent of the US with 4G service if the merger is approved. The AT&T purchase of T-Mobile is seen as a move to solve limited bandwidth brought about by the surge in mobile broadband use. Between AT&T and T-Mobile, the merger will compete in 97 of the largest 100 cellular marketing areas in the US. Sought for comment, Ramon Isberto, PLDT spokesperson, said the legal and factual contexts of these cases were different. "Our view is the Digitel transaction complies with Philippine law and will serve the public interest through better and more affordable telecom services in more areas of the country," he said. President Benigno Aquino 3rd had said the government's interest in the PLDT-Digitel merger "is to ensure that there is no monopoly. "We promised a level-playing field, and about 85 million mobile-phone users can't be tied to one provider," he said. On June 9 this year, the President signed Executive Order No. 45 designating the DOJ as the competition authority. The NTC is drafting conditions to the approval of the PLDT-Digitel deal. Earlier, sources said the NTC is likely to approve the PLDT-Digitel deal because the transacation does not violate any law. A Senate committee that looked into the transaction likewise had issued a report saying the deal complied with Philippine laws. The report added that there was no basis to indicate that the deal will restrain competition within the telecom industry or hurt public interest. Under their agreement, Manuel Pangilinan-led PLDT is purchasing a 51.55 percent stake in Digitel from the Gokongweis' JG Summit Holdings Inc. for P69.2 billion. PLDT and JG Summit earlier said they were considering to extend their August 26 deadline to complete the transaction. Both parties already extended their deadline twice.