Making Sense of the NBN Project

Making Sense of the NBN Project

Been watching the live broadcast of the Senate hearing over the National Broadband Network Project for the last 7 hours and I must say that despite the politics behind the issue, I was more frustrated with the Senators asking repetitive questions and making non-sense tech-related conclusions (that goes to Mar Roxas and Dick Gordon).

Allow me to give my few cents worth about this project, minus the kickbacks, politicking and all the controversies.

I believe that among the 3 proposals sent to the DOTC (ZTE, Arescom and Amsterdam Holdings), the ZTE had the most comprehensive solution and the widest national coverage. The Php15 Billion ($329 million) NBN project proposal of ZTE involves installation of 300 base stations, 300 backbone stations, 30 IPMPLS nodes (for an IP backbone), 24,844 customer premise equipment with voice over Internet Protocol and one Internet Data Center and Network Operation Center with a mirror site.


The transmission will be done using WirelessMAN (30 kms line-of-sight) or more commonly known as WiMAX (Worldwide Interoperability for Microwave Access) which will enable the network to cover all of the close to 25,000 municipalities (up to sixth class) and baranggays in the country.

What does each node potentially get?

  • Faster and dedicated connectivity (goodbye dial-up and Smart Bro!)
  • More secured and independent lines (depends on where you’re coming from)
  • Free, unlimited VOIP calls to any points within the national network.
  • Cheaper international VOIP calls to government offices, embassies and other installations around the world (if they’re VOIP enabled)
  • Free, unlimited Internet Fax (less paper waste)
  • Cheaper mobile phone access (using SIP phones)

Of course, you also get some of the inherent benefits of being connected to the internet. In essence, the proposed project is sound and laudable. The question whether all these benefits is worth the Php15-Billion peso price tag is still debatable.

It’s just frustrating to realize that such a technological leap forward is marred with corruption and politics. I was jumping on my seat itching to explain to our dear senators the difference between WiMAX, 3G, CDMA2000 and satellite technologies or why the last mile is the most problematic and costly even to the existing private telcos. But, such is life in this country.

To learn more about the NBN contract, you can read the full copy here. Or, you can read the full transcript of Manolo’s liveblogging the Senate hearing here.

Abe is the founder and Editor-in-Chief of YugaTech. You Can follow him on Twitter @abeolandres.

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55 Responses

  1. Heh, yeah.. All this waiting for WiMAX and it seems it will come to nothing.

  2. Gsas says:

    a little digression lang po regarding this issue..

    got the chance to listen in to a part of the hearing broadcasted through the radio this afternoon, while riding the taxi. tumawa lang po ako ng tumawa kasi naman sari-saring jokes ang pinakawalan ni Sen. Miriam Santiago. hehe.

  3. BrianB says:


    It’s not about WiMax or Broadband, it’s about Gloria. 15 billion for broadband for government bureaucrats will only go to waste. One good point asked by one senator (I believe it was Roxas) is whether other people besides government can use it. Imagine if the DECS and public schools can benefit.

    As far as the bureaucracy, the benefit is mainly in bringing the provinces closer to the executive and Manila government offices, but I doubt if the bureaucrats would be so excited about using video conferencing and such.

  4. watched the hearing as well. there was a chance for the country to step forward but it’s sad to know about the controversies behind it. and corrupt officials.

    yeah, mar and dick seems to be a little bit misleading of their questions. and formosa seems he doesn’t read the contract. whew…

    *hurts me bad, knowing that where the taxes we pay go.*

  5. Ian says:

    It’s preposterous.

    If we’re talking tech here, why not invest the Php15 billion in already-existing broadband ventures in government? There’s DOST ASTI’s PREGINET. Another is DA’s satellite VPN.

    Take note that these projects already exist, and are struggling for financial support. The people behind these projects are competent — heck, I would dare say that they are patriotic, given the measly wages they receive for the amount of service they provide.

    Sadly, though, it’s not about technology. Not at all. It’s about corruption and greed, and all the other things these foster.

  6. elmer says:

    What the heck is the RP gov’t going into? Di ba meron ng existing backbone ang pinas eh bakit kailangan pang mag-build na isa pang backbone?

    Isa pa, at sino ang mag-mimaintain ng NBN.. gobyerno? yeh right. bakit hindi nalang nila e-outsource ito?

    Natumbok ni Abe and tungkol sa LAST MILE.. ito ang problematic dapat dito ang focus ng gobyerno hindi sa backbone.

    what a waste of time and money..

  7. Jazzy says:

    Too bad. Politicians have to pretend and sound that know what they’re talking about.

    A classic example of why progress is so little in the country.

  8. Amadeo says:

    Are or were there any reliable studies specifically on the “last mile” concerns given the very unique geography of the archipelago and maybe the infrastructure inadequacies of the telcos operating in the provinces and towns of Visayas and Mindanao?

  9. woodstock says:

    In the US, lobying was legalized to create even-footed competition among their govt. contractors, hence technical deliveries of contract services are not lost after an award. Yes, the broadband deal is a great leap, but with so much weight carried, we always as usual get bogged down for the same reasons.
    Can we ever learn, anybody?

  10. deyb says:

    Yuga, I think there’s a problem with your site’s front page, every time I visit I don’t see your blog entries. I was only able to view your blog entries through

  11. WiMaz to serve the last-mile?

    The 6-mile Non-Line of Sight (NLOS) range of WiMax is about the size of a small city. This is ideal for road warriors who browse the net on their laptops in their cars, cellphones, or generally, the very mobile upscale yuppies. Urban lifestyle. That’s the purpose of WiMax when this second-generation protocol was designed.

    But if the purpose, as Formoso stresses, is to bring voice/data/image/video to remote, unwired, 5th and 6th class municipalities whose residents may have not even actually seen a computer or cellphone in their lifetime, what’s the use of spending tens or hundreds of thousands of dollar (or even a million, if you divide the $330M over 300)for a single base station which has the capacity to communicate wireless at 42MBps to a 28 square mile-area, just to connect a remote barangay hall or one public school to the network? (Disregard, for now, the fact that DepEd will also install CyberEd with satellite capability.)

    Why use the cellphone to wakeup the maid when you can use the doorbell?

    Not worth the money.

  12. jhay says:

    Perhaps they should invite you to one of the Senate hearings on the NBN deal.

    My gripes with it is, it’s all solely for the government?

    Unlimited Friendster and Multiply for gov’t employees then?

  13. Aiza says:

    Hey, I read in some blog that some senator was asking what broadband was. OMG!

    Yeah, Mr. O, can you help educate our senators what the heck this techie stuff’s all about?

  14. The Ca t says:

    As an accountant I am pretty much interested in the economic viability of the project.

    For an ordinary person, savings of 20 billion is kind of WOW, that’s a lot but subjecting it to the accountan’ts and economist’s tools of evaluating the project, it falls flat of the rosy picture the proponents are “painting” to make it economically viable.

    The NPV of the project before adjustment is negative.
    Before adjustment means before inclusion of some more barangays which are already covered by another project of Deped.

    NEDA’s computed economic NPV (net present value)is negative at P1,581.45 million.

    That means given the future stream of inflows for in the form of savings from the project, the cost is still more than the savings.

    The EIRR of 13.01 percent is only viable if the interest remaines low for the duration of the project or remains fixed. It seems the interest of the loan is commercial and not that of a government to government loan.

  15. Two words: disappointing yet expected.

    More coverage needed…

  16. hammieka says:

    I think some senators should be educated first about the latest technologies in communication. Mar Roxas was comparing the WIMAX just like his cellphone, hence no need to have one.

  17. beeps says:

    Or Better Yet Maybe We could ask the Senators to Have Abraham Olandres in the Senate Hearing to Discuss further What is inclusive in the NBN Project.

    If suggestion is okay with you guys, please vote.

    Maybe we could make arrangements.

  18. ricky gonzalez says:

    Some items that I feel were not properly addressed.

    1. NBN is a government backbone project, only national, regional, provincial, municipal and barangay agencies will be connected. I doubt if anybody in private capacity will be able to use it (i.e. private Internet Access).

    2. NBN should address net neutrality issues. Just do a traceroute from your ISP to any site and you will see how far the route takes. Some of the nodes traversed are foreign and might end up in some unfriendly coutries. A man in the middle attack is a possibility and some “unfriendlies” end up monitoring government traffic.

    Government traffic requires secure channels and NBN should be able to address this by keeping Philippine government traffic within Philippine geographic bounderies and in routes/sites it directly controls.

    3. Anytime you have additional bandwidth, it is a positive/good thing.

    4. The NBN should be able to allocate IP address for itself. I don’t know the current availability status at APNIC for a Class A IP address. But, in case no Class A is readily available a Private Class A address should be used for NBN use (i.e. 10.x.x.x). We all know how difficult it is to keep a static IP address for your use once you change carriers. NBN should properly address this issue.

    5. Only one Internet gateway for NBN that is properly secured. No end nodes should have separate Internet connectivity or we end up opening the system to “unfriendlies”.

    6. Security of government communications should have been a major selling factor of NBN. I guess this was overlooked during the part of the hearings I witnessed.

    7. Again this is a field of dreams scenario “Build and they will come”. No private telco will do last mile on missionary sites. NBN proponents should have brought up pole rights as one of the biggest hindrance in last mile solutions, making wireless a very attractive proposition.

    8. I doubt if it would be worthwhile debating technical issues with the senators. If there is a problem with the contract, the right venue would be the courts, where the rules are well established.

    9. With the television cameras turned on, senators will yearn for “Pogi” points. This maybe the reason for the inane questions thrown at the panelist. In a sense, we witnessed first hand, how shallow the understanding of our senators of the technical issues at hand.

    10. My fear will be that the project will be bogged down at the legislative and legal level, that the technology will long be outdated, before it ever gets to be installed.

  19. Ian says:

    From a security perspective, it does make sense for the government to have its own backbone. (Heh, government, backbone — two words that can’t be used together is one sentence. But I digress…)

    Ricky said:
    “6. Security of government communications should have been a major selling factor of NBN. I guess this was overlooked during the part of the hearings I witnessed.”

    I think it was brought up by senators with military background. In essence, what they’re questioning is why contract a foreign state to build the State infrastructure. Of course, it is inevitable that we would have to rely on foreign inputs for this. There were also mention of Taiwan and other countries using home-grown tech for their infra — something that is still a long way off for RP.

    That said, I believe we already have similar projects, albeit using private carriers for the long-haul: PREGINET, for example, uses Globe/Innove (last I checked, but I could be wrong since it’s been two years since I have had a chance working with them) for their regional access points, with wireless (for some areas) for last-mile connectivity.

    Speaking of last-mile, I wonder what happened to ASTI’s project with NTT on WIPAS? I was part of the field testing then, and the results were pretty impressive: 40MBps for up to two km. That’s using point-to-multipoint.

  20. Trader says:

    simple lang ang problema……

    This has been happening OVER and OVER again…. a government project that has corruption all over it….

    Why the hell our government officials always needs to BE REACTIVE?

    Why the hell the senate always wants to have a show and waste time with something that can be prevented?…

    Lagi na lang ganyan…. SENATE inquiry CRAP and B*LLSH*T….

    Can we become PRO-ACTIVE? setup rules and guidelines and processes and before signing anything we make sure things are the way they supposed to be?…..

    Kala ko matatalino ang mga asa senado….mga bobo pala….

    or cyempre gusto nila magpasikat…para sila naman ang maiboto sa susunod…

  21. minor says:

    “Ano ba ang broadband? Can somebody explain this in layman’s terms?” – some senator

    shoot that man!!!!!

  22. Amadeo says:

    I commend Mr. Ricky Gonzalez for giving such a concise but clear-eyed additional overview of this project. And in my limited understanding, I envision it as some kind of over-sized but secure WAN owned and controlled by the government. Thus, the propriety of using private IP addresses, which is what some big private telecom companies here resort to.

    And as I recall here in the US, this type of IT network deployment was used in the aftermath of the Katrina hurricane in NOLA, when all essential IT infrastructure was adjudged down and out. And it was rendered effective for its purposes. And I understand this same technology was also used effectively in the ravaged areas during the Aceh Indonesia tsunami.

    But a few more questions. Granted that no private telcos will be used for last mile concerns, how are the remote barangays admitted into the loop? The WiMax’s 6-mile range still will not be sufficient. When we were in a remote barrio in Bukidnon (at least 50kms from the nearest city), we could connect laptops to the internet using cell phones as the media. Conclusion: where ubiquitous cell sites are located, internet access is available. And additionally, access to the government network.

    Mention was made of net neutrality and am not sure how this particular issue factors in this case. I believe it should be net security that would be of primary concern, as aptly pointed out. Net neutrality has now become more of a political issue, whether there should be unrestrained freedom from regulations or restrictions, or not. But I could be wrong.

  23. Raffy says:

    Yuga, enjoyed reading your posting, and me not being a tech guy, it cleared some my misconceptions about the technology of broadband. I also read the paper written by Emmanuel de Dios ( (Dean of UP School of Economics) on the same issue and basically he does not support the creation of another “backbone” to serve as the goverment’s intranet(among other things), because, again among other things, in fact there are already two existing private and functioning backbones. Would you agree with him from a technological standpoint?

  24. yuga says:

    Emmanuel de Dios has a point as well. I believe that there are many ways to solve this problem – 1) by using existing commercial backbone; 2) by extending existing government backbone; and 3) by creating a more advanced infrastructure and forward-looking national strategy.

    Yes, I believe the project is costly and the money allotted to this can be used somewhere else. However, the presented methodology solves several issues that the others cannot.

  25. tulip says:

    I’ve been working in a multinational telecom company for sometime now, even had the opportunity to work with ZTE years ago in a project.I fully understand the deal, and yes even know some “facts” going around the industry but I will not elaborate. I agree with most of Ricky have stated. Generally, I believe a NBN project will be something useful…the problem is the process,etc.
    Honestly, I cant watch the Senate hearing too long by listening with all those non-sense statements from senators who are aspiring to become a president. It only appears they are know-it-all guys but truth is NADA.Nakakairita, nasasayang lang oras. Why not do their homeworks, at least consult a telecom executive before blabbering in the hearing??? Even our neophyte engineers and technicians at the office laughs at them!

  26. Miguel says:

    I would say… commercial backbones for the long haul then a “NBN” wireless network for the underserved areas

  27. BlackMarlin says:

    It’s a pity just for the heck of it Senators jokey for media mileage hoping to get the maximum exposure competing with Marimar and Margarita for the tv ratings.

    Anyways, the fun side of it is, that is for the IT yuppies out there, the whole world will see the stupidity of Philippine senators in all their splendor.

    Sen. Noynoy Aquino
    “Is this system 100% secured?”

    DOTC Assistant Secretary Lorenzo Formoso III
    “No your honor. There is no system in the world that can claim to be 100% secured.

    Sen. Noynoy Aquino fuming
    “If this system is not 100% secured then why are we entering into this project?”

    DOTC Assistant Secretary Lorenzo Formoso III explains for the benefit of the ignorant son of Ninoy Aquino.
    “As i’ve said your honor, there is no system that is 100% secured.”

    Ang hinahanap ni Sen. Noynoy ay system na 100% secured. Sana may makita sya.

    Sen. Biazon asking Atty. Formoso
    “You say that there are 300+ nodes for this project all over the Philippines and each node has a radius of 30kms. So you cannot cover the whole Philippines?”

    Atty. Formoso
    “Yes sir there are 300++ nodes with 30km radius each but it can cover the entire country.”

    “You said 30km radius, if i multiply this by 300++ it will not reach the entire country from Luzon to Mindanao coz i did the math.”

    Atty. Formoso
    “The 300++ nodes cover those places that have no wired access sir.”

    Marunong pala mag taymis si Sen.Biazon

  28. BlackMarlin says:

    Bakit wala si Sen.Lito Lapid sa NBN hearing? Gusto ko marinig ang opinyon ng idolo kong senador.

    Pero parang alam ko na sasabihin nya tungkol sa ZTE-NBN contract.

    “LAGOT KAYO SA MISIS KO. Ang dumi ng kontrata o!”

  29. angel reyes says:

    abe you missed the point or you were not listening intently. basic issues are:
    1. deal was done behind our backs.
    2. there was a dispute on the “amount” (who will benefit, how much is paid to whom, advances, etc)
    3. the government with their resources did not provide a “baseline” specification for the network (so is the ZTE deal comprehensive enough coz they have inside info of what the govt needs).
    4. if it went pushed thru and “everybody happy” it would just be inserted in the annual budget (for your info the annual budget is like reading three pldt directory), we end up paying it without us knowing – just like the north rail project which again is financed by China.
    5. Neda was hesitant at first to endorsed it, signed it at the last minute, and Sec. Neri was transferred to CHED.
    6. Do the math – something is fishy.

  30. Yah it is true, a senator was asking what BroadBand is. They’re confused between “BroadBand”, “DSL”, “Cable Internet”, add to that, “xDSL”, “aDSL”, “Modem”… then “Dial-Up modem”, “Cable Modem”, “DSL Modem”, then router, then, then….

    The people should be the one to move these stuff forward as our government officials mostly do not have the know-how about tech stuff..

  31. TimedOut says:

    Most of us are techie here so lets settle a bit. Let’s make these senators ask some of these questions to benefit the more percentage of our nation’s non techie ones, including themselves.

    On the other note, I think this project would even cost more than presented value. To maintain this nationwide network would be a pain. If pushed through, i hope it won’t end up being sold to a private sectors in the long term…. and money has gone to pockets of our dear politicians.

  32. Miguel says:

    PLDT or Globe can build this network, but maybe the powers that be believe those companies are too powerful already.

  33. I’ve been hearing negative feedback about WiMAX worldwide. One of them will be on:

  34. leo says:

    one word: CORRUPTION

  35. ceejay says:

    Ian said:
    “The people behind these projects are competent — heck, I would dare say that they are patriotic, given the measly wages they receive for the amount of service they provide.”

    Thanks for this Ian. I’m not sure if we already met personally. We(PREGINET NetOps) appreciate the recognition on your comment.

    Ian said:
    “That said, I believe we already have similar projects, albeit using private carriers for the long-haul: PREGINET, for example, uses Globe/Innove (last I checked, but I could be wrong since it’s been two years since I have had a chance working with them) for their regional access points, with wireless (for some areas) for last-mile connectivity.”

    Yes, we are currently connected to Globe, PHOpenIX and APAN/TEIN2 network. We have more than 300 Mbs of aggregate outbound bandwidth for the R&D and commodity transit. We are still using wifi as a last-mile solution for remote connectivity.

    Ian said:
    “Speaking of last-mile, I wonder what happened to ASTI’s project with NTT on WIPAS? I was part of the field testing then, and the results were pretty impressive: 40MBps for up to two km. That’s using point-to-multipoint.”

    A failure due to leadership issue. This is what happen when there are too many non-technical person involved on a technical project. :(

  36. nbn project? ung nbn channel 4 nga hindi pa ma-develop..panahon pa ata ng JD at DM Transit ung station na un

  37. BrianB says:

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  38. andresB says:

    Ang issue ng NBN deal ay repleksyon ng kawalan ng early awareness at vigilance sa parte ng mga mamamayan dahil sa kakulangan ng sapat na impormasyon tungkol dito. Ang issue ay inilalabas lang kapag sensationalized na.
    Sana ay gumawa ang media, bilang siyang pangunahing source ng impormasyon ng mga tao, ng pamamaraan na ang mga major projects ng gobyerno ay nailalathala at nagkakaroon ng regular updating ng mga nangyayari, simula sa conceptualization hanggang sa matapos. Ito ay makapagpropromote ng trnsparency sa mga proyekto ng pamahalaan.

  39. In terms of transparency, all government agencies are required to prepare their Annual Procurement Program to be submitted to the Department of Budget and Management and to be presented come budget hearing at both the senate and congress. This Program outlines and specifies all the requirements, services, projects etc. to be procured or to be undertaken by an agency for the following year. Unfortunately, as what Senator Roxas, if im not mistaken, found out last Wednesday at the senate inquiry, this NBN particularly the ZTE deal, is not included in the Annual Procurement Program of the implementing agency which is the DOTC. In cases like this, i think this is where AndresB’s idea of media vigilance should come in. But sad to say, this country has only a handful of Jarius Bondocs.

  40. Leigh says:

    The NBN project will solve a lot of dillemas and problems to not just government agencies but to the public as well.

    1. Goverment agencies will be interconnected including sixth class barangays. This allows for information sharing among government agencies such as NBI (National Bureaue of Investigations), SSS (Social Security System), BIR , NSO (National Statistics Office), GSIS, Pag-ibig, PhilHealth and the likes. It will be easier to get the data (like birth certificate, enroll for a SSS loan, file for a NBI clearance, and etc) that we need especially for the people who are located in the remote areas without going to the Main Offices/Headquarters. Heck, I can still remember that when I filed an NBI clearance here in Muntinilupa, I was still advised to go to the main office because they need to verify some information not in their database. It is easier to check the status of your SSS, Pag-ibig and PhilHealth if you have one ATM/card/ID that you can immediately use and swipe in the nearest kiosk.

    2. Public schools will have the means to access information and be as technically competitive as other private schools who have the means and tools.

    3. Government agencies can easily audit and track the performance of their employees. With the NBN Infrastructure they can easily setup up performance monitoring tools that can monitor the quality of their work. If the information can easily be accessed, auditors can easily verify the viability and quality of their work. (The same concept as used in contact centers and field workers.)

    4. Different government agencies spend a whole deal for the services they acquired from the private telecommunications companies. Think of all the leased lines, direct lines, mobile phones, call center solutions that they need to put up per agency. For example, let’s say one agency acquires 300 mobile phones for their employees and let’s say that they get those phones at plan 800 at the minimum so their monthly expenses for the mobile phones alone will be 240,000. You may not feel the ROI on the first year but remember ROI only happens after the first year of its implementation.

    5. Lastly, will this help in cleaning red tape and corruption? In my opinion, yes this will help in cleaning red tape and corruption. The reason red tape and corruption our prevalent is due to the fact that our processes and documents are not properly organized in a systematic way that it can be easily accessed anytime and anywhere. The only way to easily check and balance a process is if the corresponding agencies are transparent to each other through easy and immediate access to information.

    The national broadband project is something that we can all benefit from not because we can boast it to other countries that we have that kind of technology but to ensure that proper attention and service from the government are delivered to the municipalities in the provincial areas. Second, digital divide among public and private schools will be lessen. Most of all, to clean the bureaucracy and red tape in our government’s processes by ensuring the transparency of information across government agencies.

  41. Stackie says:

    I really liked the way they came off

  42. Hi my friend! I want to say that this article is amazing, great written and come with almost all vital infos. I¡¦d like to see extra posts like this .

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