Thu | Dec 8, 2016

Digicel plans to go nat'l with cable TV service

Published:Friday | September 12, 2014 | 12:00 AM
Florence Darby, managing director, Telstar Cable Limited, and CEO of Digicel Jamaica, Barry O'Brien, at the official handover of Telstar, which was acquired by Digiel. The formalities were held on Thursday, September 11. Gladstone Taylor/Photographer

Tameka Gordon, Business Reporter

Digicel and Telstar Cable Limited have closed the deal on the mobile company's acquisition of the subscriber television company, whose services the new owner eventually plans to grow nationwide.

Digicel says it will digitise Telstar's service and expand content.

"It's going to be a complete modular network. We are going to digitise it as well and there will be a lot of content added on top of what Telstar has presently," said Digicel Jamaica CEO Barry O'Brien.

"Both the service, the content and the method of delivery will be vastly improved to world standards," he told the Financial Gleaner.

Digicel did not state its investment in Telstar, but said the cost of the upgrade would be "massive".

"While Telstar only operated here in Kingston and St Andrew, we plan to have a massive roll-out in terms of nationwide service both in the existing infrastructure and in other areas," O'Brien said.

The closing of the transaction was announced on Thursday at a press briefing held at Telstar's headquarters in Kingston. The acquisition price was not disclosed.

Telstar currently provides cable TV, broadband, and VoIP services. It has a licence for the large residential town of Portmore.

Telstar was one of the first cable companies in Jamaica and was founded by the late David Darby, who was murdered in what was believed to be a contract killing in 1996 while running cables. The company has been managed by his sister-in-law, attorney Florence Darby, since 2005.

"The big thing that Telstar had was that it was a subscriber television business that had a reputation," said O'Brien.

Digicel will replace all Telstar's existing fibre, he said.

The companies are, however, to remain "largely separate".

An interim manager from Digicel has been assigned to Telstar to oversee the ownership transition alongside Darby and her husband.

There are no plans to rebrand the new acquisition, but it is possible that "a brand-new name" could be given to the entity in the distant future, O'Brien said

"The immediate plan for the foreseeable future is to continue operating under the Telstar name, but we are looking at rebranding at a future time. If we are rebranding, it would mostly likely be under a brand-new name. So, we might do what we did back in 2000, which is run some competition to come up with the likely name which we will operate under," he said.

Flo Darby says the sale to Digicel fulfils the company's desire to have an entity that "would carry on the same sort of vision that we had of service".

Darby said that with Digicel as owner, it would propel her dream for a larger operation.

"Originally, we were only allowed to be in St Andrew, so we had 10 zones. However, when one provider was given an islandwide licence, we got variations to our licence. We acquired some licences for Portmore and we also expanded to Mona, Duhaney Park and along Washington Boulevard," she said.

The company was licensed in about 35 zones at its sale to Digicel, she said. Darby would not confirm whether she would exit the company after the ownership transition.

Digicel has inherited 50 employees with the company.

"They will be working with my team. They will be implementing the processes that Digicel has and ... we are going to be employing significantly more people in this area," O'Brien said.

In the meantime: "It's business as usual. Tomorrow morning, nothing changes here. What really does change is that now Telstar has money to invest," the Digicel CEO said on Thursday.

tameka.gordon@gleanerjm.com