On Tuesday, August 30, 2011, Jamaican Prime Minister , Bruce Golding, confirmed that Digicel's takeover of Claro Jamaica has been approved by the Jamaican government.
He, however, revealed a few of the takeover conditions.
These are as follows:
1) All conditions in Digicel's original license are to be maintained. (These conditions have not been made public)
2) Digicel is to maintain two separate networks as per their original license
(Digicel Jamaica operates in the GSM 900/1800/1900 MHZ, UMTS 900 MHZ and CDMA 1900 MHZ frequencies, whilst Claro Jamaica operates in the GSM 850/1900 MHZ and UMTS/HSDPA 850/1900 MHZ frequencies.
Although Answers.com states that Digicel has CdmaOne, CDMA2000 1x, CDMA2000 EV-DO
GSM networks and Claro Jamaica CDMA2000 1x, CDMA2000 EV-DO GSM UMTS, HSDPA networks).
3) Digicel is still responsible for ensuring 90% mobile coverage for Jamaica. (They already have this covered as they claim to have 99% coverage).
Interesting huh?
Now if you were Digicel and given condition no.2...wouldn't you be smiling like crazy right now?
For it is either a gift (which you rightfully obtained from the takeover deal), for you now have three (3) additional frequencies to do with as you please, or a curse, as you now have three (3) additional frequencies that might prevent you from achieving economies of scale.
...For Claro customers in the GSM 850 MHZ and UMTS/HSDPA 850/1900 MHZ frequency ranges can't be easily migrated to Digicel's original network.
Anyway, these three (3) additional frequencies will not be available to any competitor in the new-look Jamaican telecoms marketplace.
Thus virtually shutting out any competition where these frequencies are concerned.
So are the above, really conditions?
In the meantime, Shadow Minister for Telecommunications, Phillip Paulwell - said that he thought that Claro's spectrum (frequencies) would have been given up for auction to allow another provider to enter the market.
(Fat chance! :)
If Digicel, by owning Claro Jamaica's prime frequencies, can prevent another competitor from entering the market, why wouldn't they?)
He also expressed disappointment that number portability, interconnection fees/tariffs and the possibility of Claro dealers going out of business were not discussed before the government approved the deal.
(Number portability would permit customers to migrate from one mobile telecoms provider to another and still keep their mobile telephone number.
Interconnection charges/tariffs between Claro and other Jamaican telephone networks is at most JMD $12.00 for both its Prepaid customers and its Postpaid customers.
Whilst Digicel's interconnection charges/tariffs range up to JMD $15.00 for its Postpaid customers and up to JMD $17.70 for its Prepaid customers).
But Jamaican Information Minister, Daryl Vaz, announced on Wednesday that:
1) There will be changes to Jamaica's telecom regulatory environment within the next six (6) weeks to address the number portability and high interconnection-charge concerns.
(Digicel's other major competitor, LIME, has welcomed this news).
2) The Prime Minister (PM) will address this issue in Parliament in upcoming weeks.
Well, we look forward to hearing from the PM, what these new regulatory changes will be.
At that time we'll assess whether or not these changes will result in a competitive mobile telecoms environment for Jamaica.
For the current conditions imposed on Digicel, don't augur for much active competition in Jamaica's telecom industry.
Please stay tuned for our continued analysis then!
Gillian
Sources Include
1) List of mobile network operators in the Americas outlining the network protocols ("types") for Digicel Jamaica and Claro Jamaica, via Answers.com, accessed September 3,2011
2) Digicel Prepaid tariffs and Postpaid tariffs,via DigicelJamaica.com, accessed September 2,2011
3) Claro Prepaid tariffs and Postpaid tariffs, via Claro.com.jm, accessed September 2,2011
4) Claro Americas frequencies, accessed September 2,2011
5) Claro Jamaica frequencies, accessed September 2,2011
6) TechJamaica.com Forum Thread,"Operating Frequency Bands of Lime, Digicel & Claro", accessed September 1,2011
7) Spectrum Management Authority website, accessed September 1,2011
8) Television Jamaica's Nightly News at 10:30 p.m., August 30,2011
Comments