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Smart opposing the “joint use” agreement by Globe Telecom and Bayan Telecommunications

Wireless leader Smart Communications, Inc. is opposing the “joint use” agreement entered into by Globe Telecom and Bayan Telecommunications, Inc. under which, it said, Globe will be able to illegally use the mobile phone frequencies of Bayantel. Instead, Smart is calling on the NTC to initiate proceedings to recall the frequencies assigned to Bayantel, as required by NTC rules, because of the telecom firm’s failure to use these frequencies to provide mobile phone service to the public. More details after the jump.

The NTC should then offer these frequencies to all interested and qualified applicants in an open and competitive bidding process, said Enrico L. Espanol, head of Smart’s Legal and Regulatory Department in a letter opposing the application submitted Sept. 28.

The frequencies in question are on the 1800 MHz Band which were assigned to Bayantel by the NTC for the provision of mobile phone services.

“The NTC Memorandum Circular No. 3-3-96 on the Review, Allocation and Assignment of Radio Spectrum specifies, among others, that an assigned frequency which remains unused for one year from date of issuance of permits and license may thus be recalled or withdrawn consistent with national and public service,” Espanol said.

“It is undeniable that Bayantel has not been using these frequencies for at least one year considering that it has not been providing any CMTS service to thegeneral public. Consequently, these unused frequencies assigned to Bayantel should be recalled by the HonorableCommission upon service of notice and hearing,” he added.

Espanol stressed that under the law and jurisprudence the assignment of a frequency to a telecommunications operator by the government does not confer on the operator a vested property right over the frequency. He quoted a Supreme Court ruling that states telcos “are merely given the temporary privilege of using them.”

Espanol added that the “joint use” arrangement between Globe and Bayantel would lead to “enormous loss of government revenues as the latter would be deprived of income resulting from a competitive auction among interested bidders.”

He recalled that a similar anomalous arrangement between Globe and Altimax Broadcasting Co. for the lease of broadcast frequencies to provide wirelessbroadband service on the WiMax technology had also resulted in large revenue losses for the government.

“What was lease for Altimax then is co-use with Bayantel now; but it is the same enormous revenue loss for the government,” the Smart official said.

Smart filed a complaint against the lease arrangement between Innove Communications, Inc., an affiliate of Globe, and Altimax last year, arguing that the deal violated the law and NTC regulations. It also pressed the Commission to recall the frequencies assigned to Altimax which had failed to set up a broadcasting service as provided for in its franchise. Smart’s complaint versus the Altimax deal is still pending with the NTC. The transaction has also been questioned by members of Congress who called for the recall of these frequencies.

Recalling the Bayantel frequencies and auctioning them “would be more in line with the government’s avowed policy to promote the efficient, effective and prudent use of radio frequency spectrum and will certainly redound to the benefit of the consuming public, rather than allowing Globe to use these frequencies without the benefit of an open and competitive process,” Espanol said.

“Our position is that the Commission is compelled by the law and its own rules and regulations to take this course of action,” he added.

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