3 Reasons Why A Liberalized Telecommunications Sector Was The Best Thing For Jamaica

Growing up in Jamaica, one can never forget the day in the late 1990s that the government decided to open our telecommunications industry to competition, ending years of monopoly service. To many, those were the days of neglect, limited innovation and one could say poor customer service. Now as we look back and recognize World Telecommunications day we at Moneymax101.com recognize and remember where we are coming from and the significant progress we have made as a people. Let us look back at the path to liberalization which began many years ago and use this day as an opportunity to highlight some of the major achievements and possibilities the liberalization of our telecommunications has brought for us.

Payphones were once a hit in Jamaica Chelsea Gomez

A Look At Liberal-i-zation

Liberalization which comes from the word liberalize and also the word liberal refers to a relaxation of previously held policies and controls. As defined by Wikipedia, ‘In general, liberalization (or liberalisation) refers to a relaxation of previous government restrictions, usually in such areas of social, political and economic policy. In some contexts this process or concept is often, but not always, referred to as deregulation’. Liberalization is also linked to de-monopolization.

Some of us do not remember the pre-liberalized days. However I cannot forget those days in the early 2000s when news broke as a teenager that there would be some competition in our telecommunications industry. I was overjoyed. As a youth transitioning between high school and community college the days of the fridge phone and dialup 56k modem would soon be over.

How did this whole process begin? Patricia Roberts-Brown and Paul Golding in their research paper on The Legal and Socio-Economic Impact of the Liberalization of the Telecommunications Sector provide some background about how we got here. They note that ‘this phased liberalization began on March 1, 2000, when the Telecommunications Act 2000 (The Telecoms Act) became effective. ‘

Two carrier licenses were soon awarded and Mossel trading as Digicel commenced service in April 2001 followed by Oceanic Digital Jamaica Limited trading as Centennial. With the entrance of these two players our lives changed dramatically. Digicel signed up 100,000 customers in its first 100 days, a game-changing move in Jamaican telecommunication!

1. Competition Brings A Boost To Our Economy

Fast-forward 7 years later to 2007 where ‘Minister of Industry, Technology, Energy and Commerce, Phillip Paulwell, has said that the liberalization of Jamaica’s telecommunications industry and the opening of the market to competition, has led to billions of dollars being invested in the information and communication technology (ICT) sector.’ Minister Paulwell stated this in his messageto mark World Telecommunication and Information Society Day on Thursday, May 17, 2007.

As Bahamas gets ready for competition in its telecoms sector, they are now anticipating a similar experience to ours – cheaper prices and improved services from the increased competition. We here in Jamaica can speak to the economic benefits gained from making that transition.

Those economic benefits include the rollout of new cell-sites and all the related services in many different sectors. Roberts-Brown et. al continue to outline the benefits to the economy in their research paper

The liberalization of the telecommunication sector in Jamaica led to foreign investors establishing commercial presence and investing billions of dollars on the purchase of computers, data storage, network equipment and infrastructure build out, which led to job creations and opening of call centers and other ICT related business and services. Under Phase 1 of the liberalization programme, cellular licences to Digicel and Centennial raised US$92million. By Phase 2, Digicel had spent over US$272 million for licence and cell sites and would spend another US$17million to expand its network. By Phase 3, the subscriber base for Digicel was over 2.1 million customers with over 1000 cell towers spread over the 14 parishes of Jamaica. Table 1 shows the Capital expenditure in the Mobile sector between 2001 and 2005.

Capital Expenditure in Jamaica’s Mobile Sector – 2001 to 2005

It is obvious, that this opening up of the sector was a well needed economic boost.

2. Better, Quicker, Faster Communication

How we communicate has also been impacted by the liberalization. We now have the benefit of cheaper communication where we can communicate for far less. This has helped to reduce the cost of doing business as communication costs are a big factor in obtaining and maintaining jobs. Sole traders, tradesmen and the occasional freelancer are totally empowered to expand their business. Quicker communication and Improved services are also benefits as business are now able to be more responsive and even anticipate customers’ needs

3. Improving Our Way of Life

And how could we forget the impact on our culture. As defined by Dictionary.com, culture refers to the behaviours and beliefs characteristic of a particular social, ethnic, or age group. With the launch of new mobile phone competitors in early 2001 Jamaicans immediately realized that things would no longer be the same – as it related to our culture, or way of life.

Liberalization brought with it a change in our behaviours and beliefs. While strange at first, to be always carrying around our mobile phones, it quickly become characteristic of Jamaicans to always have them at hand. While unimaginable at first to be able to contact anyone, anywhere, at any time – it is now an after-thought. And while we never thought we would have gotten here so fast, we are now able to communicate in all kinds of ways with all kinds of people and places – sending text messages for phone numbers (4-yellow), voting for our favourite rising star, or interacting with our local news stations. Now we capturing special moments and share them with our reliable and ever present wi-fi or other wireless services – and don’t forget to take out that phone in the dance when Chris Martin, says ‘Lighta fi yu mamma’.

Cellphones with cameras om a concert Flickr

The impact and benefits of liberalization do not only stop in these areas. In education, health care and security the benefits continue to mount and we are now doing things that were once only once a dream!