March 1, 2017
Transcript of Sen. Grace Poe's sponsorship speech on Smart franchise
Mr. President, my dear colleagues :
I am pleased to sponsor Committee Report No. 43, which seeks to extend by 25 years the franchise granted to Smart Communications.
The report recommends the approval and amendment of House Bill No. 4637, taking into consideration Senate Bill No. 1302.
Most importantly, our report took into account the views aired and position papers submitted by government, business and consumer representatives during the two public consultations called by your Committee on Public Services.
Like the cellphone load it sells, Smart's franchise has an expiry date-this March 27, which marks the 25th year its current franchise, Republic Act (RA) 7294, was signed into law.
When RA 7294 was enacted, Internet was in its infancy and Mark Zuckerberg was in First Grade. In the quarter of a century that has passed, information technology has rapidly advanced, such that Smart's franchise, for it to the attuned to the age of Facebook, must also be upgraded.
The modifications are evident in a side-by-side comparison of Smart's expiring franchise and the bill that the House had passed.
It would have been expedient for the legislature to roll over Smart's franchise by simply extending it.
But we know that obsolescence does not only plague technology but regulatory frameworks as well.
This why, Mr. President, that in addition to endorsing its approval, we are also proposing amendments to House Bill 4637.
First, we deleted the term "co-use" in the application of the franchise so that this seemingly innocuous word cannot be invoked in employing anti-competition practices.
Second, we have retained the original wording in RA 7294 which mandates the public listing of Smart's shares of stock.
During the hearings, we have emphatically conveyed to SEC the sense of the Senate that it must enforce this provision of the law and that any failure on the part of the grantee to comply must be severely penalized.
Third, we are compelling Smart to install facilities and bring under its coverage areas not yet served, specifically calamity-prone ones, where the presence of telecommunication services can help in times of disaster.
Fourth, we are requiring it to upgrade and program its entire infrastructure to be on standby to send out free mobile disaster alerts as mandated by Republic Act 10639.
Fifth, we are requiring congressional consent on the sale, lease, transfer, usufruct or assignment of the franchise, except in certain cases.
But how I wish, Mr. President, that we could include service guarantees, performance benchmarks, improvement pledges in the bill as the public hearings centered on these.
How I wish we could accommodate penalties for lousy service in franchises.
How I wish we could outlaw dropped calls, fine slow Internet, and ban false advertising.
How I wish we could insert provisions which punish overbilling, reinstate vanishing loads, and sanction weak signals.
But unfortunately these do not fall within the ambit of a legislative franchise. It is a function of regulation, and today these are proof of failed or feeble regulation.
As I have been told that these complaints can be addressed in a separate legislation that will apply to all telcos, I hope that before the curtain falls on this Congress, we will be able to pass one for our consumers.
Just the same, our regulators have been put on notice, and come budget season, we will ask them if they have been able to deliver on what they had promised.
These are up their alley, the core of their work, so NTC, DICT, and DTI cannot reply with the pre-recorded message that these concerns "are outside their coverage area."
They need not be reminded of what the Supreme Court had stressed that "a legislative franchise is a special privilege which cannot be exercised at will and pleasure..." and that a franchise is "reserved for public control and administration" under such conditions and regulations the government may impose on them "in the interest of the public."
As I have said time and again, Smart may have 70 million subscribers but it must also subscribe to the law.
Smart's large customer base underscores its status as a vital industry.
After power and water, broadband has become the third utility. There are now more phones than people, and more SIM than the population.
And while the archipelago is crisscrossed by electrical lines from hundreds of power distributors, and there are over a thousand water districts and companies piping in water to homes, cellular phone service is dominated by only two players.
The privilege, however, of cornering this market, and making money out it, and of using publicly owned airwaves, comes with the non-negotiable condition that business will be conducted in an honest and honorable way that satisfies the individual customer, the common good, and national development goals.
Let me emphasize "national development goals."
Because broadband speed affects the pace of our economic growth, I cannot overemphasize the importance of a telco that provides excellent service.
The velocity by which data travels and is transmitted impacts on how fast we progress as a nation. The road to progress is now made up of fiber optics, portals and not just mortars.
The faster our internet, the faster our growth. A telco thus can catapult our development, or drag it down.
Mr. President, my dear colleagues:
Thank you for your time, and I submit this bill for your consideration.
Thursday, April 27
Wednesday, April 26