CWC-Flow deal raises questions, says Gonsalves
Prime Minister of St Vincent & the Grena-dines, Dr Ralph Gonsalves, says the acquisition of Columbus International by Cable and Wireless Communications Plc (CWC) raises the spectre of the monopolisation of Internet services.
Last week, both companies announced the deal in a joint statement, saying the proposed acquisition, valued at US$3.025 billion would enable the combined company to significantly accelerate growth and strengthen its position against competitors.
During a press conference on Monday, Gonsalves said the Ministry of Telecommunications as well as the National Telecommunications Regulatory Commission and the Eastern Caribbean Telecommunications Authority would advise the Cabinet ahead of its deliberations on the deal and its implications.
"But clearly, on the face of it, it raises questions, which have to be satisfied, because we have a law, which we passed in 2001 in the Parliament of St Vincent and the Grenadines, which opened the door for competition to move away from Cable and Wireless having a monopoly. What we are now having is a monopoly in the country - the Internet services," he said.
"So, on the face of it, some issues of a monopoly have entered the picture and the regulatory authority would have to take this matter into consideration in managing that - regulating that monopoly as we are going forward. And I would suspect that you would have similar instincts on the face of it," he told reporters.
The prime minister said his comments were not to be taken as an official position, but rather he was speaking generally about the purpose of liberalisation.
"We still have competition with voice telephony, but we are now going to have a monopoly in relation to the Internet, and, therefore, in data?" queried Gonsalves.
He added that were such a monopoly to emerge, there were legal avenues through which the interest of consumers could be safeguarded.
"The law has provisions for monopolies, dominant providers, and how to address those. There is a legal framework and, if needs be, we will strengthen the legal framework, to make sure that dominant providers, and monopolies do not provide substandard services and at prices which normally would not be competitive if you had another provider in the marketplace," said Gonsalves, who is also minister of legal affairs.
CWC's main competitor, Digicel Group, has said it will be pushing for a rigorous review of the deal by regulators.
CWC trades in the Caribbean as LIME, while Columbus International operates mainly as Flow and Columbus Business Solutions.