IN an article entitled "All Steamed Up Over Txt" published last Saturday, September 1, 2001 in the broadsheet newspaper Malaya as reported by Reuters, Makati Business Club executive director Guillermo "Bill" Luz criticized cellphone consumers complaining about the involuntary and unilateral reduction of allocated SMS "text" messages by cellular service companies for taking their case to court, and also expressed disbelief in the presence of collusion among the cellphone service players.

According to the article:

"He said oil companies had been the target of a lot of criticism and protest about their pricing in the past, and people have called for a transport strike
or boycott but that was within their rights as consumers.

'But to go to the courts to thwart a business decision, that's a different matter because once that starts then what business won't be attacked in similar fashion?'

Luz rejected suggestions of collusion.

'As we've seen in the oil industry price adjustments among the competitors happen almost at the same time because they need to retain market share ... it's not a sign of collusion as some people are suggesting,' he said.

Companies with high profits usually need to reinvest them to improve the services, he said."

If this report is accurate (and we hope it is not), it is a regrettably hasty and irresponsibly-made statement by Mr. Luz and the MBC. In classic display of old boy's club solidarity, they issued this statement to Reuters immediately after the issuance of a TRO against the move to reduce free text messaging by
the cellphone companies. Even without having appreciated the basis for plaintiff's resort to legal remedies on the issue, the MBC was quick to lambast the move as an attack on legitimate decisions in knee-jerk fashion.

Underlining the present public outcry against the cellphone companies is the
lack of antitrust/anti-monopoly laws especially in the area of state regulation of public utilities, and the apparent regulatory capture by service providers of the government agencies charged with protecting public interests against the commercial viability of those same service providers. Regulatory capture is a natural tendency of the regulator and the entities being regulated to arrive at collusions with each other via an understanding of their respective positions as the result of their necessary and frequent interaction, and usually at the expense of the consumer. Customers become involved only when there are public hearings called for, and in most instances are unable to comprehend even the terminology used in the formal conduct of the hearing.

As a result, public utilities have become more callous, insensitive and out-of-touch with the needs of their customers and their satisfaction. Regulatory capture has become more expedient than fair and honest market capture, never mind the relatively smaller expense in terms of bribes and payola, since return on investments become guaranteed. How else does one explain the expectation service providers have of the regulator's agreement that higher rates would allow them to improve services at their customers' expense? Why extract from consumers such a high price to improve lousy service which should be naturally guaranteed by service providers and the regulator in the first place? The public perception is that commercial viability even of inefficient business operations has become more important than customer satisfaction and well-being, at clear and grave prejudice to consumers.

If we do not submit notice of this conspiracy against us before our courts,
where do we expect aggrieved consumers to go? Our constitution allows relief of legitimate grievances, and it is left for our courts to determine whether these concerted efforts on the part of citizens in submitting their complaints are reasonable or not. Why has the MBC been so quick to denounce this legal remedy?

Is it because these cellphone companies are influential members of their exclusive club? Could this also be why the MBC has been likewise as quick to reject any possibility of collusion among these companies, precisely in order to deflect attention and criticism of such possible collusion occurring regularly as a matter of course within its own ranks?

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Jonathan Emmanuel P. Domingo
President
Philippine League for Democratic Telecommunications, Inc.
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