The plan could hurt the revenue streams of the nation's largest telecoms.
A new plan from the government of the Philippines would offer free wireless internet to people across the country while also likely eating into the annual revenue of the nation’s telecoms.
Bloomberg reports that the Philippines government plans to roll-out its free Wi-Fi services to roughly half of the country’s municipalities over the next few months and the country has its sights set on nationwide coverage by the end of 2016. The free wireless internet service will be made available in public areas such as schools, hospitals, airports and parks, and is expected to cost the government roughly $32 million per year.
As for how the new plan will affect the Philippines’ two largest telecoms, Philippine Long Distance Telephone and Globe Telecom, the companies may need to make a value play to hold on to customers. Monchito Ibrahim, deputy executive director of the country’s Information and Communications Technology Office, told Bloomberg that the telecoms may need to offer “higher-end services” to lure subscribers away from free government Wi-Fi.
The government’s goal is to expand internet access to areas of the country currently without access while also lowering the country’s relatively expensive internet costs. According to research firm IDC, internet costs in the Philippines average around $18 for each megabit per second, compared with a global average of just $5.
This isn’t the only government initiative seeking to offer free internet access, as lawmakers in India’s Delhi territory recently proposed a plan to offer free Wi-Fi usage up to one gigabyte per month to go along with the government’s plan to eventually offer free internet access in all government and private colleges. Meanwhile, companies like Facebook FB and Google GOOG have projects in development to bring internet connectivity to remote areas of the world.