Eastern Caribbean countries are venting their frustration at what appear to be efforts by British telecommunications giant Cable & Wireless to thwart their attempts to benefit from a de-regulated industry.
Governments and consumer groups in the sub-region have publicly condemned the firm, which for many decades operated as a monopoly, for stifling competitors and unilaterally hiking prices despite agreements about phasing in competition and capping rate increases.
The governments belong to the Organisation of Eastern Caribbean States (OECS), which includes the islands of Antigua and Barbuda, St. Kitts-Nevis, Montserrat, St. Lucia, Dominica, Grenada, and St. Vincent and the Grenadines.
They are not the first to protest the giant U.K. firm’s reluctance to accept competition. Last December, Jamaica’s Constitutional Court found that an agreement between the Jamaican government and Cable & Wireless to liberalise telecommunications in the country over three years failed to increase competition or freedom of expression, as it had promised.
The case grew out of a challenge by Cable & Wireless against a local competitor that began offering cheap long-distance calling via the Internet, reportedly at 60 percent of established rates.
In the OECS, street demonstrations are being planned amid allegations that the firm is seeking to undermine plans to liberalise telecommunications.
In St. Lucia, consumer groups have announced they will demonstrate later this week to protest what they term the company’s ”predatory instincts” after it announced price increases effective Mar. 14.
Last week, the British firm announced rate hikes for local and mobile calls, domestic and residential lines and directory enquires but a decrease in rates for international calls in Dominica, Grenada, St. Vincent and the Grenadines and St. Lucia.
National Consumer Association (NCA) President Andrew Antoine said his organisation was concerned that the new rates were being introduced contrary to an existing agreement between the company and member states of the Eastern Caribbean Telecommunications Authority (ECTEL).
It’s an accusation that the Grenada and St. Kitts-Nevis governments have also levied against the Cable & Wireless.
St. Kitts-Nevis Deputy Prime Minister Sam Condor said that the announced increases were undermining the process that the parties agreed to last year.
ﾔThe actions by Cable & Wireless (St. Kitts and Nevis) Ltd. in announcing their intentions to increase rates for certain regulated telecommunications services effective Mar. 1 2003 are a direct violation of the agreement signed by members of the OECS contracting states on May 20, 2002,ﾔ Condor said.
Under that agreement, Cable & Wireless and five OECS states agreed to work toward liberalising the industry, in exchange for the giant firm agreeing not to contest the unilateral termination of its exclusive licence to provide telecommunications services in those nations.
The accord was not signed by Montserrat, a British colony and Antigua and Barbuda.
Condor said the announced rate increases also violate the operating licenses he issued to the company, and called upon Cable & Wireless ”to retract all public statements made in relation to changes in prices for regulated telecommunications servicesﾔ.
Officials in Grenada say the firm failed to submit required information about its costs before announcing the proposed increase. The proposal does ﾔnot run in accordance with agreed principlesﾔ, said Communications and Public Utilities Minister Gregory Bowen.
ﾔMeaningful information with respect to costs from Cable & Wireless has not been forthcoming, making it impossible to prepare a price cap regime based on actual costs,ﾔ he added.
The Grenada minister also accused Cable & Wireless of setting high interconnection charges to companies wishing to compete with the firm, which must use Cable & Wireless infrastructure to provide services.
ﾔIn some cases in the region, their charges were higher than their (Cable & Wireless’s) retail per minute charges to the public, which will obviously make it uneconomical for any new entrant to operate,ﾔ he said.
ﾔIf the incumbent, as it appears the intention is, establishes high local call charges from which high interconnection charges may be justified, then competition will be under severe pressure. Is this the intention?ﾔ Bowen asked.
Last weekend, the Cable Company in St. Kitts-Nevis announced it had filed a complaint with the eastern Caribbean’s National Telecommunications Regulatory Commission against Cable & Wireless ”after months of delay, refusal and frustration of its efforts to obtain interconnection with the network of Cable & Wireless as mandated by the Telecommunications Act”.
”The net effect of the frustration of The Cable’s attempts to interconnect is that it deprives citizens of the federation of the ability to choose their provider for international telephone service,” the company said in a statement.
Other companies poised to enter the industry in the sub-region to compete with Cable & Wireless’ cellular telephone operation include Wireless Ventures, a subsidiary of AT&T Wireless Caribbean, and Digicel Caribbean, an Irish-based company.
Barbados-based Cariacess has already been awarded licenses as an Internet service provider in at least three OECS territories – St. Lucia, Grenada and St. Vincent and the Grenadines.
Last weekend Cable & Wireless refuted the many allegations.
In a statement the company said that, consistent with its agreement with OECS states, it is ”working to ensure a smooth transition to competition and the achievement of the goals of liberalisation and the creation of a free and fully-liberalised market”..
”The company therefore regards these public statements as unfortunate, especially at a time when it has already arrived at interconnection agreements with its competitors throughout the OECS,ﾔ it added.
The statement said Cable & Wireless had been cooperating with regulators to establish a price cap and that the announced rate increases, which it calls ”rate balancing”, are necessary to make the cost to consumers reflect the real cost of providing services.
The move is also integral to the introduction of competition and was recognised by the OECS states in the agreement, the statement added.
According to the company, the agreement requires only that it give a one-month notice before increasing rates. ”Cable & Wireless exercised this right,” it said.
”In practice, the rebalancing of rates announced by Cable & Wireless means that the 20 percent increase in local rates will be matched by up to a 59 percent decrease in international rates.”
The company recently announced its intention to become a major player in the Bahamas, where officials have announced plans to privatise the state owned Bahamas Telecommunications Corporation. (BATELCO).
By Peter Richards, IPS
