Gov’t to study PLDT, Digitel merger impact

FORT MAGSAYSAY, Nueva Ecija – President Aquino Wednesday expressed concern over the possible impact of the merger of Philippine Long Distance Telephone (PLDT) and Digital Telecommunications Philippines Inc. (Digitel) on consumers.

Aquino said the government would have to study the effect of the merger of the two telecommunication giants on the consumers.

“That is currently being studied. There are allegations, among them from Globe (Telecoms) and of course, we want to ensure that there is a level playing field,” Aquino told reporters after witnessing the annual Balikatan military exercises between the Philippines and the United States troops here.

Aquino said there is a need to study the merger, particularly the technical aspects.

“I have to admit I am not an expert on these things so it is being studied by people more competent than I as far as the technical aspects are concerned,” Aquino said.

“We will be sitting down soon with the economic team, with the DOJ (Department of Justice), with the technical people of NTC (National Telecommunications Commission) and as of now, we are reviewing the merger of Sun (owned by Digitel) and Smart (owned by PLDT).”

Aquino said he could not make any conclusions regarding the merger.

“It’s difficult to conclude because we’re studying it right now but I am concerned enough to warrant a study,” he said.

Presidential Communications Development and Strategic Planning Office Secretary Ricky Carandang said economic managers also raised their concerns over the possible impact of the merger “on the consumers, on prices of the service that consumers pay for their cellphone service.”

“There have been concerns about the impact that it will have on the structure, on the market whether that will become more or less free, there are those kinds of discussions within the economic cluster,” Carandang said.

He said the government has submitted for priority the anti-trust bill before the Legislative-Economic Development Advisory Council (LEDAC).

He said the anti-trust bill aims to regulate the ability of the company to engage in monopoly practices.

“I am not saying there was an anti-trust action here. All I’m saying is that the anti-trust legislation that we submitted to Congress may be the framework by which large mergers and acquisitions like this that have a market impact can be considered,” Carandang said.

Carandang added he was not sure what Malacañang could do at this point without an anti-trust law.

“We’re not sure right now what the possible impact would be. There are those saying that the prices of cellphone service might go up but there is no definite conclusion yet,” Carandang said.

He said the Department of Trade is also studying the impact of the merger.

“At this point we’re not in a position to intervene,” Carandang said.