As Digicel visits, govt urged to conduct 'auction' for mobile services

Wed, Dec 11th 2013, 11:40 AM

The government has been urged to ensure it engages in a competitive "auction" process in order to identify the most suitable potential competitor for Bahamas Telecommunications Company (BTC) in the mobile market post-exclusivity in 2015.
The comments came from a source with intimate knowledge of telecommunications in the region, as Guardian Business understands that P.J. Patterson, former Jamaican prime minister and Digicel representative, was in The Bahamas last weekend having meetings aimed at furthering the company's goal of participating in the Bahamian telecoms market.
Guardian Business understands that Digicel, which has a strong presence through the Caribbean, is pursuing approval to offer services in the Bahamian fixed line and Internet markets, as well as the cellular market.
Minister of State for Investments Khaalis Rolle said yesterday that as far as he was aware, Patterson did not meet with the government during his recent visit.
Meanwhile in a statement, Digicel said it remains interested in becoming a part of a competitive cellular market in The Bahamas, and confirmed Patterson's visit to The Bahamas, but declined to comment on what transpired during his time here or as a result.
To date, Digicel has been granted an operating license for The Bahamas by URCA, which essentially means that body has sanctioned it to provide services in The Bahamas.
Currently limiting its ability to participate in the Bahamian market in any service areas, whether it be fixed line or internet, is its lack of a business license - an approval that would have to be given by the government, not URCA.
There is no indication to date that there has been any movement on this front on the government's part and the prime minister is understood to be lukewarm on the prospect of another entirely foreign entity entering the market.
Guardian Business understands that Patterson held meetings with officials at the Utilities Regulation and Competition Authority (URCA), which regulates the telecoms sector. It is not known who else he met with.
Yesterday a source with knowledge of the telecoms sector in the region, who spoke with Guardian Business on condition of anonymity, said that it would be in the interests of The Bahamas to continue to send the signal that participation in the telecoms market in The Bahamas is open to any company that can provide a good proposal.
"The key issue is there is a limited amount of spectrum for mobile in any country and you want to get the right value for that spectrum when you give it to someone new.
"The most common method now to have an auction; so you pre-qualify those who you are willing to have in the country and they all enter auction, and the guy willing to bid the most gets the spectrum and gets the license.
"It creates revenue for the government, and it ensures whoever wants it has something at stake. Some form or auction or process would seem to be the best option for the government," suggested the source, who added that the challenge is to determine a price which adequately values the spectrum without discouraging, or slowing, the roll-out of services once it is obtained.
Meanwhile, the source also suggested that it would be in the best interests of Bahamians to allow Digicel to begin providing fixed line and internet services in The Bahamas in the run up to full liberalization in the telecoms sector.
"They are a foreign investor but they have something to contribute; it's in the best interest of the sector to have more competition. They have been trying to get it for over a year now," added the source.
In its statement to Guardian Business issued yesterday in response to questions regarding Patterson's visit, Antonia Graham, Head of Group Public Relations for Digicel, said: "We are delighted to see that competition in the mobile sector in The Bahamas may become a reality and remain interested in the opportunity to be a part of that process.
"We continue to monitor the situation on an ongoing basis and can confirm that Mr. Patterson was in The Bahamas at the weekend."

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