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DITO Telecom’s launch beset by technical issues

Dito Telecommunity Corp.’s March 8 commercial launch brought to light some network limitations, including SIM card incompatibility, leading industry stakeholders to conclude that the third telco still has much work to do before it garners a bigger share of the consumer market.

The company disclosed during its launch that only a limited number of smart phones were compatible with its network services.

Dito chief technology officer Rodolfo Santiago said while other phones that were not on Dito’s short list may still work with the telco’s network, Dito could not guarantee that users of other phone models would not experience technical issues as they were not tested for network compatibility.

“To protect the public, there may be technical issues that are unforeseen,” Santiago said.

Democracy.net.ph, an ICT advocacy group tasked by the Senate public services committee to assess Dito’s commercial launch, questioned why Dito chose to start the operations in the countryside where majority of consumers were not using smart phones.

“The feature phone market in the Philippines is still very high, especially used by classes D and E, or our kababayans that run on 2G frequency,” said Pierre Galla, engineer and co-founder of Democracy.net.ph.

“I’m surprised Dito Telecommunity restricted their list [of compatible phones],” he said.

Feature phones make use of less-advanced systems, and would therefore not work with a Dito SIM card that by default runs on 4G or 5G systems.

Dito intentionally implemented such a strategy in an effort to offer more advanced services compared to the legacy systems of competitors Globe and PLDT.

The locations chosen by Dito for the initial launch, however, did not match the said strategy as it chose to go online in the Visayas and Mindanao – where potential subscribers in many rural areas would not be able to buy smartphones for use with Dito SIM cards.

Dito has yet to make available a subscriber plan that bundles a phone with its SIM.

Galla said at least 60 percent of Filipinos continued to use legacy phones such as older Nokia models. Both Globe and PLDT were encouraging subscribers for years to shift to 4G from 2G and 3G, but majority of the population remained on the older systems.

The advocacy group head also reported deficiencies in Dito’s independent audit prior to its launch, reporting that the National Telecommunications Commission allowed the sampling of a much smaller number of barangays than previously required to determine if the telco could meet its first-year commitments.

Galla said that instead of testing more than 8,800 barangays, the NTC allowed the sampling of just 2,671 barangays. He said the field tests also covered 200 cell sites out of Dito’s 1,602 active sites. “We recommend a sampling method should not be applied [for the next audit],” Galla said.

This prompted Senator Risa Hontiveros to demand that NTC respond to the reported deficiencies in Dito’s audit, saying that “the NTC should answer the questions raised by advocacy groups regarding its technical audit of Dito. If the agency will not be able to do so, it will only add to the public’s suspicion that it may be at the behest of the China-backed third telco. Is China also holding our own agency by its neck?” she asked

Aware of the hurdles Dito is facing, Smart Communications’ next generation technology solutions advisor Joachim Horn said that Dito would “take a long time to catch up”.

As far as we have information in the areas DITO is launching, they cannot even get close to the coverage we have already,” said Horn at a media briefing.

Two days after its commercial launch, shares of DITO CME Holdings dropped 25 percent ending at P9 per share on March 10 from a previous close of P12.

The closing price was also down 55 percent from the company’s all-time high of P19 per share recorded on Feb. 23.

Joey Roxas, president of Eagle Equities, noted that while there were several factors which led to the drop in share prices, principal Dennis Uy himself sold DITO CME shares several weeks ago, and Dito itself also said that the telco would not make money for at least two years.

Topics: Dito Telecommunity Corp. , Rodolfo Santiago , network compatibility
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