DITO Telecommunity Corp., the company behind the country’s planned third major telco, stands to lose its P25.7-billion performance bond should it fail to meet its commitments.
A week before its technical launch, Dito chief administrative officer Adel Tamano said during a Senate hearing on Wednesday the company only has 300 operational cell sites to date.
Tamano said Dito needs 1,300 sites to meet the technical launch requirement to cover 37 percent of the Philippine population and provide a minimum average internet speed of 27 megabits per second.
He blamed the delay to movement restrictions caused by strict lockdown measures imposed to halt the spread of COVID-19 from mid-March until the end of May 2020.
“The COVID and the lockdowns have prevented us from our full rollout," said Tamano.
A missed deadline for Dito indicates the company would be left with no choice but to ask for a grace period from the Department of Information and Communications Technology (DICT).
Former DICT Undersecretary Eliseo Rio Jr., who was a resource person at the Senate hearing, said this means the company already exhausted one of the two grace periods on meeting rollout targets under its franchise.
The bidding terms of reference allow a grace period in case DITO fails to meet its deadlines.
Section 14 of the terms of reference state that DITO will be allowed two grace periods of six months each within the five-year commitment period.
Once the company hits Strike 3, Rio said the government can forfeit to its favor the P25.7-billion performance bond Dito paid before construction activities and the recall of its assigned radio frequencies.
“As far as I know, they [Dito] have not requested for any postponement of that commitment… But definitely they are saying they could not have the 1,300 (cell sites) finished by July 8…. If they cannot comply by July 8, then that is their Strike One,” Rio said.