The ‘Magic of Chavit’: How the first shared telco infrastructure became reality despite red tape

How the first shared telco infrastructure became reality despite red tape

Roughly three months from now, the first shared telco infrastructure in the Philippines will rise from the quaint town of Caoayan in Ilocos Sur, just a few kilometers away from the famed Historic City of Vigan.

It will be a historic moment, says Department of Information and Communications Technology (DICT) Undersecretary Eliseo M. Rio Jr., as it will mark the new era for the Philippine telecommunications industry.

Rio, who jump-started the common-tower initiative during his stint as de facto chief of the ICT department last year, explains that this initiative has long been needed since the Philippine tower density rate is one of the lowest in the world and has resulted in poor Internet services.

“We are making history here, but really need to add more towers as soon as possible using this initiative,” he says.

The government aims to build at least 50,000 common towers across the Philippines to improve its tower density rate, which is currently at 0.14 percent or one tower serving 4,000 subscribers. The government’s goal is to improve it to be on a par with neighboring countries like Vietnam, Indonesia and Thailand.

Building common towers will allow telco players to lease from tower operators instead of building their own infrastructure. Not only does it remove the capital needed to build and maintain a facility, it also cuts away the duplication of the same facility in one area.

The first tower is currently being built by LCS Holdings Inc., a company owned and controlled by politician Luis Chavit Singson, who hails from Ilocos Sur. His group successfully complied with all the requirements needed for the tower build, including the over 28 permits from the national and local governments.

Its first customer is Dito Telecommunity Corp., projected to be the third telco player in the country. Led by Davao-based businessman Dennis A. Uy, the company tapped Singson’s group, once its rival in the auction for the third telco license, for its telco infrastructure requirements.

Dito Telecommunity Chief Technology Officer Rodolfo D. Santiago said that the group decided to pursue this initial phase of tower build with LCS Holdings because of the magic that is Chavit.

“What’s the difference—the likes of Mayor Singson. He is very serious in having a very good business and that is not present before. Also, it’s the support of the government to really make faster the rollout of towers because the government knows that without the push, this cannot happen,” he says.

Singson, who has long been a politician, now sits as the mayor of Narvacan, Ilocos Sur. He is currently positioning himself as the next president of the League of Municipalities of the Philippines.

His group’s hasty action toward clearing permits was unprecedented, given that incumbent telco players had been pointing a finger at government red tape as the culprit for the low tower density rate in the country.

For the first tower, Singson’s group partnered with Thai tech group Ua Withya Public Co. Ltd. to build its first common tower in Ilocos Sur, but the group remains open to more partners, as it gears to invest billions of pesos in order to build as many as 70,000 towers in the next decade.

“We have identified 6,000 sites now. We are in talks with small and big companies to build this. All in all, we are targeting 50,000, 60,000, or even 70,000 towers spread over 10 years,” he told the BusinessMirror.

Singson’s list will involve the rollout plan of Dito Telecommunity, formerly known as Mindanao Islamic Telephone Corp., which aims to start offering telco services by 2020.


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