October 31, 2020

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National Broadband Program could save the Philippines US$ 15 million in 2021

Through its National Broadband Program (NBP), the Department of Information and Communications Technology’s (DICT) deploys broadband capacity across the nation. A part of DICT’s connect-connect-connect initiative, the NBP is the government’s blueprint to accelerate the deployment of fibre optic cables and wireless technologies across the country to provide broader, faster, and more affordable access to the Internet for Filipinos. They are especially targeting areas that are remote, inaccessible and considered unprofitable by the private sector.

This strategy not only serves citizens directly but also empowers other government agencies that serve such communities. Once the first phase of the DICT NBP is completed, agencies working in these locations will have access to cheaper and more reliable Internet services. This will reduce the government’s direct expenditure on connectivity costs and simultaneously ensure minimum downtown for their digital service offerings.

Through the program, government agencies can avail internet service at 50 pesos (about US$ 1) per megabits per second (Mbps) of internet bandwidth per month. At present, government offices spend around 250 pesos (US$ 7.25) per megabits per second of internet bandwidth per month.

This means that an average size agency which requires 100 Mbps shared internet connectivity across a whole building spends around 35,000 pesos (US$ 725) per month translating to 420,000.00 (US$ 8,700) each year.

With the NBP, an average office would now only spend five thousand 5,000.00 pesos(US$ 103) per month or 60,000 pesos (US$ 1,250) a year for the same speed. This is a significant saving of taxpayers money that can be reallocated for other programs and projects and in improving citizen services. The DICT forecasts that the government can save 720 million pesos (US$ 15 million) in internet subscription expenses in the first year of implementation of the NBP alone.

For Phase 1, the DICT will activate the Cable Landing Station in Baler, Aurora and connect to the National Grid Corporation of the Philippines (NGCP) Node in San Fernando La Union through the Luzon Bypass Infrastructure. DICT will then activate and light up of 4 DICT nodes and 15 NGCP nodes that will connect with the various DICT equipment. From there, we will be able to provide bandwidth to nearby govnet clients and Free-WiFi beneficiaries.

By 2022, if the DICT’s additional budget request of approximately 17 billion pesos (US$ 351.5 million) for the Fiscal Year 2021 is approved, the proposed Phase 2 of the NBP will cover Luzon, Visayas and Mindanao posing a projected savings of around 34 billion pesos in government Internet expense.

In perspective, neighbouring countries with similar initiatives, such as Indonesia, Australia, and New Zealand allotted significantly higher budgets for their National Broadband Network.

Indonesia is reported to have allocated over US$ 22 billion (1.07 trillion pesos) for its 5-year national broadband plan, while Australia and New Zealand allocated around US$ 37 billion (1.79 trillion pesos) and US$ 1.19 billion (58 billion pesos) respectively. Other countries such as Singapore are improving their systems by spending around US$ 550 million (26.72 billion pesos) and opening up their network to all service providers.

DICT Secretary Gregorio B. Honasan II said that President Rodrigo Duterte’s directive was very clear – to improve Internet connectivity in the Philippines to help the Filipino people better adapt to the new normal. That is why the DICT is doubling its efforts in accelerating the implementation of various digital connectivity initiatives, especially the National Broadband Program.

By the end of 2020, Phase 1 of the NBP will begin operations and by 2021, DICT is confident that the nation would enjoy the benefits of the initiative.