Philippine Communications Satellite Corporation

Philippine Communications Satellite Corporation, commonly known as Philcomsat, is a Philippine telecommunications company headquartered in Makati, Metro Manila, with its principal teleport in Baras, Rizal. The company was established as a joint venture involving the Philippine government and the Philippine Overseas Telecommunications Corporation (POTC), a firm associated with businessman Potenciano Ilusorio and then Defense Secretary Juan Ponce Enrile. Its creation formed part of the Philippines’ effort to secure a permanent connection to international satellite communications systems. Philcomsat inaugurated a permanent earth station in Baras on May 2, 1968. As the Philippines’ signatory to the International Telecommunications Satellite Organization, or Intelsat, and Inmarsat, it served as a national gateway to global satellite networks. On June 21, 1969, Republic Act No. 5514 granted the company a franchise to operate ground stations and related facilities for international satellite communications, together with tax exemptions under the law. The franchise was later extended through Republic Act No. 11226, signed on February 22, 2019, extending the company’s authority until 2044. For much of its early operating history, Philcomsat was a crucial supplier of international telecommunications circuits to Philippine carriers, including the Philippine Long Distance Telephone Company and other telecommunications operators. Its infrastructure supported international voice, data, and other communications services at a time when the country’s access to overseas networks depended heavily on a limited number of satellite gateways. The company became entangled in the political and economic controversies of the late Marcos period. In 1982, the Philippine government sold its interest to POTC, making POTC the sole owner. The transaction was later cited in discussions of crony capitalism because control and beneficial interests were associated with figures connected to the Marcos administration. Ferdinand Marcos was reported to have acquired an indirect stake through corporate fronts, and his son Ferdinand “Bongbong” Marcos Jr. became chairman of the Philcomsat board in 1985. These arrangements later became subjects of public and governmental scrutiny. Following the 1986 People Power Revolution, the Presidential Commission on Good Government (PCGG) sequestered Philcomsat and POTC. Successive administrations appointed government nominees to their boards. According to findings discussed in a Philippine Senate investigation conducted in 2006 and 2007, the companies’ business and finances deteriorated during the period of sequestration, with allegations that former boards and managers dissipated company resources. In 2016, the Supreme Court ruled that the companies had been wrongly sequestered since 1987. Since 2000, the Republic of the Philippines has held a 35 percent interest in POTC, while the balance has been held by private shareholders, notably members of the Ponce-Enrile and Ilusorio families. In the period described by reference materials, Philcomsat was managed by Lin I. Bildner and Katrina Ponce-Enrile, identified as descendants of the founders’ families. The company sought to recover funds lost during earlier management periods and rebuild its telecommunications operations. In its more recent business, Philcomsat has provided satellite communications services to the Philippine government. It also partnered with Australian satellite-services provider Speedcast International in the installation and provision of connectivity for the Philippine government’s Free Wi-Fi For All project, administered jointly by the United Nations Development Programme and the Department of Information and Communications Technology. Its historical importance rests on its role as one of the Philippines’ foundational international satellite communications operators, while its corporate history reflects the country’s changing relationship between public infrastructure, private ownership, political influence, and telecommunications regulation.

Philippine Communications Satellite Corporation was formed as a joint venture between the Philippine government and the Philippine Overseas Telecommunications Corporation. The company was created to establish a Philippine gateway to international satellite communications and to represent the country in international satellite organizations. On May 2, 1968, Philcomsat inaugurated a permanent earth station in Baras, Rizal. The facility connected the Philippines to the worldwide Intelsat network and became the company’s principal teleport. The company also served as the Philippines’ signatory to Intelsat and Inmarsat. Its statutory operating authority was formalized on June 21, 1969, when Republic Act No. 5514 granted a franchise to operate ground stations and other facilities for international satellite communications. The law also provided tax exemptions. Republic Act No. 11226, enacted in 2019, later extended the company’s franchise until 2044. Philcomsat became an important supplier of international circuits for Philippine telecommunications operators, including the Philippine Long Distance Telephone Company. Its position was especially significant while international telecommunications depended on relatively scarce satellite earth stations and gateways. Through its infrastructure, the company helped connect Philippine carriers and users with overseas communications networks. Ownership changed substantially in 1982, when the Philippine government sold its stake to POTC. POTC consequently became Philcomsat’s sole owner. The sale and the company’s relationship with figures close to the Marcos administration were later discussed as an example of the political concentration of business ownership during the period. Reference accounts state that Ferdinand Marcos held an indirect interest through front companies and that his son Ferdinand Marcos Jr. was appointed chairman of the Philcomsat board in early 1985. Questions surrounding the company’s ownership, board appointments, and compensation became part of broader investigations into the Marcos-era business system. After the 1986 People Power Revolution, the Presidential Commission on Good Government sequestered Philcomsat and POTC. Government-appointed nominees subsequently occupied board positions in the companies. A Philippine Senate investigation conducted in 2006 and 2007 concluded that the companies had suffered from the conduct of former boards and managers, including the alleged dissipation of corporate funds and assets. The companies’ telecommunications expertise and commercial performance declined during this period. In 2016, the Supreme Court ruled that the sequestration had been legally improper since 1987. Since 2000, the Philippine government has held 35 percent of POTC, while private shareholders, particularly the Ponce-Enrile and Ilusorio families, have held the remaining interest. In the period covered by the reference material, management was associated with Lin I. Bildner and Katrina Ponce-Enrile, described as descendants of the families involved in founding POTC. Philcomsat subsequently pursued recovery of funds lost under earlier management and worked to rebuild its communications business. The company’s later activities included providing satellite communications services to the Philippine government. Philcomsat also worked with Speedcast International, an Australian satellite-services provider, on the installation and supply of connectivity for the Free Wi-Fi For All project. That initiative was administered jointly by the United Nations Development Programme and the Philippine Department of Information and Communications Technology. Philcomsat therefore combines a legacy role in international satellite gateways with more recent government-oriented connectivity projects.

• 2019

  Franchise extended to 2044

  [1]Philippine Communications Satellite Corporationen.wikipedia.org

  Republic Act No. 11226 extended Philcomsat’s telecommunications franchise until 2044.

• 2016

  Supreme Court overturns the basis for sequestration

  [1]Philippine Communications Satellite Corporationen.wikipedia.org

  The Supreme Court ruled that Philcomsat and POTC had been wrongly sequestered since 1987.

• 2006

  Senate investigation begins

  [1]Philippine Communications Satellite Corporationen.wikipedia.org

  The Philippine Senate investigated the condition and management of Philcomsat and POTC during the period of government sequestration.

• 2000

  Government retains a minority interest in POTC

  [1]Philippine Communications Satellite Corporationen.wikipedia.org

  The Republic of the Philippines was reported to hold a 35 percent interest in POTC, with the balance held by private shareholders.

• 1986

  Philcomsat sequestered after the People Power Revolution

  [1]Philippine Communications Satellite Corporationen.wikipedia.org

  The Presidential Commission on Good Government sequestered Philcomsat and POTC following the change of government.

• 1985

  Ferdinand Marcos Jr. appointed board chairman

  [1]Philippine Communications Satellite Corporationen.wikipedia.org

  Ferdinand Marcos Jr. became chairman of the Philcomsat board during the late Marcos administration.

• 1982

  Government stake sold to POTC

  [1]Philippine Communications Satellite Corporationen.wikipedia.org

  The Philippine government sold its stake to the Philippine Overseas Telecommunications Corporation, making POTC the sole owner of Philcomsat.

• 1969

  Statutory telecommunications franchise granted

  [1]Philippine Communications Satellite Corporationen.wikipedia.org

  Republic Act No. 5514 granted Philcomsat authority to operate ground stations and related facilities for international satellite communications.

• 1968

  Permanent Baras earth station inaugurated

  [1]Philippine Communications Satellite Corporationen.wikipedia.org

  Philcomsat inaugurated its permanent earth station in Baras, Rizal, establishing a Philippine connection to the international Intelsat satellite communications network.

A Philippine satellite communications infrastructure provider with a historic role as a gateway to international telecommunications networks and a continuing focus on government and enterprise connectivity.

• Telecommunications

  Satellite communications services

  Philcomsat provides satellite-based communications capacity and related connectivity services, including services supplied to Philippine government users. Its operating heritage is tied to international satellite networks and communications gateways.

• Satellite infrastructure · 1968

  Baras teleport and earth-station operations

  The company’s principal teleport in Baras, Rizal, began operating in 1968 and served as the Philippines’ permanent earth station for connection with international satellite communications systems.

• Public-sector communications

  Government connectivity projects

  Philcomsat has supplied satellite communications and connectivity infrastructure for Philippine government programs. In cooperation with Speedcast International, it participated in the Free Wi-Fi For All project.

• 2007

  Alleged depletion of Philcomsat and POTC resources during sequestration

  A Philippine Senate investigation examined allegations that government-appointed boards and managers had mismanaged or dissipated assets of Philcomsat and POTC after the companies were sequestered.

  Source

• 1982

  Ownership transfer and alleged crony-capitalism connections

  The sale of the government’s interest in Philcomsat to POTC, together with reported indirect interests linked to Ferdinand Marcos and the appointment of Ferdinand Marcos Jr. as board chairman, became part of wider criticism of politically connected ownership during the Marcos administration.

  Source

Read more

• Free Wi-Fi For All

  Philippines

  Philcomsat partnered with Speedcast International to install and provide connectivity for the Philippine government’s Free Wi-Fi For All initiative, administered by the Department of Information and Communications Technology and the United Nations Development Programme.

  Outcome. The reference material identifies Philcomsat as a major installer and service provider for the initiative but does not provide quantified deployment results.

  Source

• 2019

  Secure a long-term operating franchiseStrategy

  Background

  Philcomsat required statutory authority to continue operating telecommunications facilities and satellite ground infrastructure.

  Action taken

  Republic Act No. 11226 extended the company’s telecommunications franchise until 2044.

  Aftermath

  The extension provided a longer legal basis for continued satellite and telecommunications operations in the Philippines.

  Source

• 1982

  Transfer of government ownership to POTCM&A

  Background

  The government held an interest in Philcomsat as part of the company’s original joint-venture structure.

  Action taken

  The government sold its stake to the Philippine Overseas Telecommunications Corporation.

  Aftermath

  POTC became Philcomsat’s sole owner, and the transaction later attracted scrutiny because of reported political and business connections.

  Source

• 1968

  Establish a permanent international satellite gatewayStrategy

  Background

  The Philippines needed permanent infrastructure to connect domestic telecommunications operators with global satellite networks.

  Action taken

  Philcomsat inaugurated its Baras, Rizal earth station and operated as the country’s gateway to Intelsat and Inmarsat services.

  Aftermath

  The company became a major supplier of international circuits to Philippine telecommunications carriers.

  Source

1. 1Philippine Communications Satellite Corporationen.wikipedia.org