COMMUNICATIONS-JAMAICA: Monopoly Telecom Firm Fights to Defend its Turf

By IPS Correspondents Reprint | | Print |

Dionne Jackson Miller

KINGSTON, Feb 21 2000 (IPS) - Despite considerable resistance from the political opposition and independent telecommunications providers here, the government has used its majority in parliament to push through a controversial new telecommunications law, which detractors say will slow the country’s march into the electronic age.

For over a decade, Jamaica’s telecommunications market has been served by the United Kingdom-based monopoly provider Cable and Wireless (C&W), which was granted an exclusive 50-year licence in 1988.

But with recent developments in the telecommunications industry and a new minister in the driver’s seat who is determined to liberalise the market, C&W has repeatedly found itself in court defending legal challenges to its claim of exclusivity over voice and data transmissions.

Independent providers felt they were slowly gaining ground, but in a surprise move last September, the government and C&W signed a new agreement which drew sharp criticism even before the ink had dried.

The agreement specifies a three-year transitional period to an open market, in which two mobile network operators will be licensed in the first 18 months, with data, Internet and other information services open to competition as long as international facilities are leased from C&W.

The government lost no time in auctioning two cellular licences, raising over 90 million dollars.

But critics charged that in the absence of a clear inter-connection policy, the agreement would merely serve to cement C&W’s monopoly and give the company an insurmountable head start on the competition.

The argument heated up after a court in Dominica found that C&W’s monopoly licence was unconstitutional and violated freedom of speech provisions.

Last week, the issue came to a head in a marathon two-day debate in parliament. But with the government’s hefty 50-10 majority in the lower house, there was never much doubt that it would push the law through – especially since it would be forced to pay compensation if the bill was not passed six months after the signing of the agreement.

Maxine Henry Wilson, a minister in the Office of the Prime Minister, made no secret of the fact that the government had no intention of entertaining an endless round of debates.

“We have gone through the full process with this bill,” she said. “At a particular point in time, the bill comes to the house, and the house has to make a decision. The system we operate says the majority which is gained through elections, and reflects the will of the people, is what carries the bill, always observing the opinion of the minority.”

The bill passed the lower house with over 100 amendments, but critics say many were cosmetic, involving grammatical and spelling errors rather than substantive changes.

Members of the Jamaica Telecommunications Group (JTC), a coalition of Internet service providers and other telecommunications companies, insist that the rapid pace at which the legislation was pushed through was not in the best interests of the country.

“We are concerned primarily at the pace at which they have rushed to an agreement. The JTC’s concern is that the bill is not in keeping with the telecommunications policy, that it is denying us of freedom of speech, our right to choose and of competition,” said Carlton Lawrence of Compuworks Multimedia, an Internet service provider.

The government’s haste to enact the bill – with or without bipartisan support – came to the fore in Friday’s sitting of the Senate.

Bills passed in the Lower House are often sent back after vigorous debate in the Upper House. But this time, the government’s aggressive approach prompted an opposition walk-out.

Opposition members said they were given the amended bill minutes before the sitting, but calls for more time to study the legislation were refused.

The last straw, said opposition senators, was the government’s decision to curtail their debating time.

Unhindered by the presence of the opposition, the bill sailed through, with the senate ignoring the amendments suggested by one independent senator.

The government is now focused on persuading the public that the Bill is in its best interests, and has given considerable publicity to C&W’s commitment to install 217,000 new telephone lines as part of the agreement.

However, the JTC has been maintaining that instead of focusing on outdated land-line technology, the emphasis should be on wireless technology, which is cheaper and more accessible for remote rural populations.

“You’re selling your future for 217,000 lines, when if you had opened up competition now, you could have far in excess of 217,000 getting into the hands of those who need them,” Lawrence says.

The government is pinning many of its hopes for economic growth on the telecommunications sector, but critics say that the three-year period until full competition will hinder growth.

“The bill is going to put us low on the totem pole as a destination to come and do business with,” says Herman Athias, a telecommunications provider.

“As an individual who has made investments here in Jamaica, I am very concerned because the barriers to enter the telecommunications market for my company are going to be much higher,” he says “Come three years from now, it’s going to be so high that I won’t want to invest and many other companies won’t want to invest and this monopoly will continue to the detriment of the consumer.”

But with the bill now made into law, the political opposition and independent telecommunications providers say they plan to seek recourse in court.

They say they will challenge the new law on the grounds that it is unconstitutional and curtails freedom of speech, an argument dismissed as nonsensical by government lawyers.