Beware! All is Not Well in Caribbean Telecoms

This article was received in the form of a letter from Mr. Anthony Gunn . From the outset it would appear that Mr. Gunn is also giving justifying reasons for engaging other interests in the development of telecoms in the Caribbean such as the undersea cable from the US Virgin Islands to St. Luca and Barbados and then from Grenada to St. Vincent. Trinidad is also included. - Roosevelt O. King

Years after the independent people and governments of this region have made it abundantly clear that yes, we are keen to follow not only global trends but WTO mandates as well, and liberalise the stranglehold that telecom monopolies have had on our livelihood, we continue to be "managed" by the said telecom monopoly.

Licenses have been awarded, issued and granted to a variety of players, yet Cable & Wireless has wiggled and squiggled to delay the onset of full competition in the market, effectively maintaining itself as a monopoly.

They engage in all manner of legal mumbo-jumbo to delay competition on all fronts. More like tricks to me. Whilst not an entirely surprising belief on their part, they have no God-given right to treat us this way.

For example, some two and a half years ago Cariaccess was awarded and received an Internet Service Provider License in March of 2002 by the Government and people of St. Vincent & the Grenadines . It was granted a similar license a year later in St. Lucia .

C&W then immediately embarked on what can only be described as an orchestrated, deliberate and systematic path to block Cariaccess from getting started. This is evidenced clearly and demonstrably by the fact that their rates and pricing practices for newcomers are prohibitive and inflexibly high and this has the effect of blocking all competition to this day.

Competition has to do with how accessible the market is to a newcomer and what stumbling blocks are in the way. Fair competition means that the incumbents ought not to block the path of new entrants. Whether or not a newcomer successfully enters is governed by the level of demand in the market; not by predatory pricing or other unfair practices.

By now Cariaccess should have thousands of happy customers online in each island, but instead, competition is "blocked" throughout the OECS today. The only dial-up Internet provider in the OECS is C&W and unless something is done soon to stop C&W from overcharging providers in Barbados , C&W will soon be the only Internet Service Provider in Barbados as well. Then prices are sure to triple back up to the old days.

C&W not committed to development

C&W's outlandish dial-up Internet and other rates are several times higher than everywhere else in the free world. Meanwhile only 3% to 6% of the population in the OECS is online, placing us squarely at the bottom of the global bucket.

Yet we talk about a knowledge-based future with thousands of jobs in the services sector driven by telecommunication networks. What telecom networks? Where are the jobs? Call centers closing down around us left, right and center, nothing major on any horizon.

It was reported several weeks ago that hundreds more jobs were lost from the region when yet another company shut down and moved to India due to outrageous telecom rates. If C&W is allowed to continue along this path with our lives and countries, where will we end up in this globalised economy?

So far, valiant efforts by some Government departments and new regulators on the scene are also being blocked by C&W with their legal maneuvering, cloaked under their claimed need to "rebalance" and realize their return on their "stranded investments". Utter rubbish!

C&W West Indies Ltd. has enjoyed almost 100% mark-ups on their services for decades The profit in 2002 was reported as EC$2 Billion - yes, Billion with a "B" from total revenues of EC$4.2 Billion; so they have way more than happily recouped all of their investments.

Rebalancing can only be described as a fake argument designed to delay the process and maintain their status quo for as long as possible. Besides, what about the stranded investments made by Cariaccess and others who are sitting around incurring harmful costs? Are we not entitled to recover for investments stranded as a result of C&W blocking?

The new Telecom laws and fair trading legislation are great and will do wonders eventually, but unfortunately, as we sit here in late 2004, we CANNOT allow the "legal process" to be the only settlement force in sorting out the mess that regional telecom liberalization has become.

Just as in the recent past with cellular interconnection, C&W is going to have to be once again wrestled to the ground by the Prime Ministers and Cabinets and forced to "behave" and allow the will of the people to prevail; otherwise, all these shiny new licenses being handed out are going to be meaningless for years to come whilst the 'legalites' work things out, something this region and local telecom investors cannot afford.

I therefore call on our leaders and Cabinets to take this matter urgently into their own hands again and force the process back on track before we all follow the derailed train into becoming technology "have-nots" in the modern world.

Anthony Gunn
October 30th, 2004
agunn@cariaccess.com tel 246 822 3000