DICT seeks own data centers in bid to enhance data sovereignty

The Department of Information and Communications Technology seeks to build government-owned data centers as part of its 2026 budget request, a move that DICT budget sponsor FPJ Panday Bayanihan Representative Brian Poe frames as a shift away from reliance on foreign cloud providers.

At the House budget deliberations on Tuesday, September 30, Poe said the government currently spends around ₱12 billion annually on cloud services, with 90% of data hosted abroad, largely in Singapore. The DICT and legislators note that this is potentially a national security risk, with sensitive information residing outside Philippine jurisdiction.

To address this, the DICT is proposing to build three government-owned “major” data centers this year at a cost of P2.5 billion.

Poe explained: “What’s being done currently is we’re trying to classify which government data are considered high points of concern and which ones are less urgent. However, the goal of the DICT and the government is hopefully that we’re able to create our own servers here in the Philippines to store the data.”

The projected need for the e-Gov app alone is about 300 terabytes of capacity, with more required as additional agencies migrate. The agency argues that investing ₱7.5 billion in nine data centers over three years to develop on-premises data centers would ultimately be cheaper than continuing with recurring cloud costs, which reach ₱12 billion every year.

“DICT’s request for capital outlay for infrastructure development is badly needed and urgently needed in terms of timing because we’re trying to catch up to where the rest of the world is,” Poe said.

Bagong Henerasyon Representative Robert Nazal proposed to use funds from the Spectrum Users Fee to finance the project. The SUF was created in 2018 as a fee collected annually from mobile network operators who provide telecom services. Since then, around ₱41 billion has been collected, and the DICT currently reports a balance of ₱21 billion.

Free Wi-Fi in schools, budget for the blockchain

Connectivity in schools remains a priority under the proposed 2026 DICT budget. There are 37,308 public schools nationwide, with around 78% (around 26,644 schools) currently connected to the internet. The agency has set a target of connecting the remaining 12,139 schools by the end of the year.

The sponsor emphasized that connectivity in education is a “non-negotiable” priority if digitalization goals are to be met.

Another element in the budget discussion was the blockchain, support for which has been growing since the filing of SB 1330 or the Philippine National Budget Blockchain Act in September 2025. Studies have estimated that building a secure, government-wide blockchain network would require an initial ₱500 million seed capital, Poe said, in line with the budget proposed in the Senate bill.

Data sovereignty concerns over Meta’s submarine cable

ACT Teachers Representative Antonio Tinio also raised concerns about the Philippines’ reliance on infrastructure associated with Meta for the country’s national broadband network. The country has a deal with Meta to use the American company’s submarine cable, whose landing station is located in Baler, Aurora.

Tinio questioned the sovereignty implications, particularly on legal jurisdiction and data access.

“Dapat ultimately kontrolado ng mga Pilipino ang datos ng mga Pilipino…equally important, ay dapat kontrolado ng mga Pilipino ang sariling network or internet ng Pilipinas…. Bakit po natin tinataya ang buong National Broadband Network sa imprastruktura ng isang US corporation?… Hindi kinikilala ng Meta ang batas ng Pilipinas pero kailangan siyang sumunod sa batas ng US. At may malawak na kapangyarihan ang gobyerno ng US sa ilalim ng batas para sa, for example, surveillance, especially surveillance over foreign governments.”

(Ultimately, Filipinos should control the data of Filipinos — whether it’s government data, private sector data, or especially the data of individual citizens. Equally important, Filipinos should control the country’s own network or internet. Why are we entrusting the entire national broadband network to the infrastructure of a US corporation? Meta does not recognize Philippine law, yet it is bound to follow US law. And under US law, the US government wields broad powers for surveillance — especially surveillance over foreign governments.)

He added, “The benefit of having free access to the infrastructure is outweighed by the greater considerations of ensuring sovereignty over our network and the assurance that our access is through an entity that is itself under the sovereignty and jurisdiction of our own laws.”

Poe countered that safeguards exist — such as anti-DDoS provisions and arbitration clauses in international law — and stressed that there are exploratory talks with other partners, including Japan, to diversify connectivity sources.

SIM Registration Act challenged, 2G and 3G phase-out

The hearing also turned to the effectiveness of the SIM Registration Act. Despite the registration of 203 million SIMs and the blocking of around 6 million (a “good number” linked to illicit activity), Kabataan Representative Renee Co pointed out that scam texts remain rampant.

Co questioned whether the SIM Registration Act had been the right approach in the first place.

“It is to prevent spam, scam, text messages.But now that we’re discovering this, I could say that actually the SIM Registration Act isn’t the most fitting solution…. If 90 to 95% [of scam messages] are because of IMSI catchers…shouldn’t those be the target? IMSI catchers are devices that intercept mobile phone communications by impersonating cell towers,” she said.

Poe responded that the SIM Registration Act was meant to remove anonymity, and in that respect, it has been effective. But he conceded that IMSI catchers have worsened in the last two to three years, and this was not factored into the original law.

He added that the registration system at least provided a foundation for blocking illicit SIMs.

DICT and telcos have pointed out that IMSI catchers mainly exploit 2G and 3G networks. The DICT said that Smart will complete 3G phaseout by September 30, while Dito and Globe have already completed sunsetting. 2G is in the process of being phased out, with no specific completion date given. Removing the older network technology will also free up spectrum for newer, more secure, encryption-enabled 4G and 5G technology.

2G and 3G users account for 15% of all mobile users, a number that DICT Secretary Henry Aguda is now low enough that is justifiable to shut down older tech.

Poe also mentioned a current partnership between the Cybercrime Investigation and Coordinating Center (CICC) and Rappler, aiming to strengthen efforts against disinformation through joint monitoring, fact-checking of flagged accounts, and promoting digital citizenship through initiatives like Facts First PH. – Rappler.com