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Philippine NTC Issues VoIP Regulations
By DAVID SIMS
TMCnet CRM Alert Columnist
Philippine VoIP providers will be required to post a performance-guarantee bond, according to the Filipino news service ABS-CBN.
"Besides a minimum paid-up capital, firms interested in offering voice calls over the Internet, or VoIP have to post a performance bond to guarantee the delivery of services to the public," the National Telecommunications Commission said.
The Philippine journal Business World called the move an effort "to block fly-by-night providers, but at the risk of preventing some bona fide applicants."
The NTC is also requiring that companies planning to offer VoIP must pass through the networks of fixed-line carriers, according to INQ7.net.
This ruling applies to service providers hungry for the "more than eight million Filipinos working overseas as a major market for overseas calls," INQ7 says, adding that the NTC prohibits VoIP players from using foreign IP addresses:
"Under the guidelines, all inbound and outbound VoIP traffic must pass through the networks of local exchange companies, for which the NTC has assigned codes. When a call goes through a foreign IP address, it bypasses the network of the Philippine telecom companies. Doing so is illegal, said a lawyer for a major phone company."
The NTC will require VoIP service-providers, defined as "a person or entity providing the service directly to the public or through resellers for compensation," to post a P5-million performance bond on top of raising at least P10 million ($180,000) in paid-up capital.
In addition to the bond, anyone register as a VoIP service reseller, defined as "persons or entities that intend to derive or source VoIP service from a duly registered VoIP provider under an agreement to resell the service directly to retail end-user customers," is required to show proof that the entity is at least 60 percent owned by Filipinos.
According to ABS-CBN, the Philippine National Economic and Development Authority estimates that VoIP can reduce the cost of current international calls "as much as 75 percent, from the present $0.40 to only about $0.10 a minute, or even lower, as is the case in other Asian countries."
Business World reports that the Philippines has seen "long-drawn debates over telecommunication firms' rights as service providers and the right of typically small value-added service companies like internet service providers to offer this service at rates that could be much cheaper than those of big telcos."
Telcos argue that VoIP is a voice service, the journal says, "noting that, under Republic Act No. 7925, only telcos that have Congressional franchise can roll out voice services." VAS providers contend that "hefty financial requirements" should not be "slapped on a service that, theoretically, does not require that much capital to offer and that this is one business that evens the playing field."
The performance bond companies must post needs to be from a registered insurance or surety company, preferably from the Government Service Insurance System, the NTC said.
David Sims is contributing editor for TMCnet. For more articles please visit David Sims' columnist page.
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