PORT OF SPAIN, Trinidad and Tobago, May
23 (IPS) -- The sole provider of telecommunications services in the region
for more than a century, British telecom giant Cable and Wireless PLC is
going to have to move over to make room for competition. Five regional
governments have come together to form a telecommunications watchdog agency
whose principal role will be to foster competition in the industry.
The five -- Dominica, St. Lucia, Grenada,
St. Vincent and the Grenadines and St. Kitts-Nevis --formalized the accord
establishing the Eastern Caribbean Telecommunications Authority (ECTEL)
at a summit in Grenada earlier this month of the Organization of Eastern
Caribbean States (OECS). The eight-member OECS acknowledged the telecommunication
industry was a vital tool for socioeconomic development and that liberalizing
the sector would only benefit their economies and consumers.
But not all eight are participating in
ECTEL. OECS officials say that Antigua and Barbuda has decided to pursue
its own path to liberalization of its telecommunication industry. In the
case of Montserrat and the British Virgin Islands, their political status
with Britain -- both are dependent territories -- prevent them from joining
the ECTEL. ECTEL's budget is yet to be finalized, but OECS officials
say it is likely to be generated from fees collected from the sale of radio
spectrum from the five participating countries.
The OECS countries are hoping that demands
for radio spectrum -- electronic magnetic waves that cross boundaries --
will increase as data broadcasting, video-conferences and other business
communication tools come on-line. ECTEL will be headquartered in
St. Lucia and will serve "to ensure that the telecommunications sectors
in the five participating states have fair competition, consumer protection
and investor confidence."
The members of ECTEL have also agreed to
speed up new legislation setting the stage for the new liberalized telecommunication
sector. "Those already in the business will need guidance for example
in controlling anti-competitive behavior, universal service and access
obligations. The new people providing service will want to enter on the
basis of fair play and transparency," said a statement from the OECS Secretariat.
St. Lucia's Communications Minister Calixte
George urged unity in the liberalization process "If we are to succeed,
we should never allow ourselves to be divided. We must be prepared to work
with our brothers and sisters for convergence," he remarked. The
OECS countries have, over the years, been setting the stage for liberalizing
their telecom sectors. In 1998, they established an OECS Telecommunications
Reform Project, with a budget of $10.2 million.
The International Bank for Reconstruction
and Development (IBRD) and the International Development Agency are providing
$6 million between them, with the five participating governments and grants
accounting for the remainder. The main objective of the project is
to introduce competitive reforms in the telecommunication sector. The OECS
Secretariat said that such reform "speaks to the ongoing negotiations with
the current monopoly provider Cable and Wireless."
Cable and Wireless got a taste of its future
in the Caribbean when it lost a court battle in Dominica last year against
a local start-up. The court victory for Marpin Telecoms and Broadcasting
has encouraged the other OECS member states to hasten the liberalization
process. Their positions have been strengthened by the fact that, as in
the case of St. Lucia, many of the current contracts with Cable and Wireless
have either expired or are on the verge of doing so.
St. Lucia's George regards the expiration
of the accords as a release "from bondage, not from purgatory, but from
hell." The sheer muscle of the company has not been easy for
regional territories to contend with. Cable and Wireless has interests
throughout Asia, the Caribbean, Britain and the United States. The company
reported global profits totaling 3.5 billion pounds sterling for the fiscal
year, which ended last March 31, up from the 1998-99 figure of 908 million
pounds sterling.
Global revenue for the British telecom
giant stood at 9.2 billion pounds sterling up to March 31 this year, a
16 percent increase over the 1998-99 figure of 7.9 billion pounds sterling.
And it did not get this big by just simply rolling over for the competition.
This company will continue "to be committed to the customers not only in
Dominica, but throughout the region," says Carl Roberts, a Cable and Wireless
manager in Dominica, who added the company is undaunted by the court ruling.
"Our pledge is to continue to work with
the governments and people of the region," the company says in "A Caribbean
Story, Cable and Wireless," a brochure.
"The goal of Cable and Wireless is to be
partners with governments, to help to grow the region's economies, while
providing a variety of basic and sophisticated phone services to more people
around the region," it added. The company has produced a video entitled
"In Touch With You" in which it demonstrates how Cable and Wireless has
made a significant contribution to the lives of the people in the Eastern
Caribbean, in areas such as health, infrastructure development and sports.
Further, it says, its commitment to the
region is demonstrated through the investment of more than $1 billion over
the past five years and plans to do the same over the next five. In addition,
the company says it has been spending millions of dollars annually to train
its staff as well as contributing to the development of West Indies cricket.
Prior to a meeting of OECS ministers responsible
for telecommunications and their negotiators in Dominica last year, Cable
and Wireless issued a fact sheet in which it said it was "anxious to change"
and was looking forward to working with the governments to implement new
pricing structures. The company also offered incentive packages on its
Internet services.
The OECS Telecommunications Reform Project
is now developing a training program to improve the information skills
of the member territories. The training program is considered vital to
OECS governments who regard information skills as being necessary to "attract
investment from foreign companies wanting to out-source information processing
tasks and to support local firms needing to implement new technologies
to increase competitiveness."
They are aware that advanced technologies
are driving the convergence of office equipment and telecommunications,
blurring the traditional distinctions between data processing and telecommunications
and enabling new value-added services, which the OECS countries say they
want to take full advantage of, as companies spend billions of dollars
to network their products.
Last month, several issues critical to
a liberalized telecom industry, such as inter-connection, tariffs and pricing,
universal service and numbering, were discussed at a major conference of
stakeholders. American Consultant Martin Taschdjian, addressing the
conference on the "United States Experience in Inter-Connection," has recommended
the OECS regulators set the price of "call termination," where a subscriber
to one provider can speak to those who subscribe to other providers.
Taschdjian, a former senior official who
worked with the International Telecommunications Union (ITU) and Bell Atlantic,
believes it would prevent a situation where the incumbent "will want to
entrench its dominance of the "call origination" market by denying or over-pricing
call termination to competitors."
Donnie De Freitas, project manager of the
OECS Telecommunications Reform Project, says the draft legislation for
the member countries provides for universal service to include public voice
telephone, Internet access, and telecommunications services for schools,
hospitals and the disabled. He says the emphasis will be on ensuring
that "as wide a range of people as possible share in the freedom to communicate
by having access to efficient and modern telecommunications at an affordable
cost."