Editorial | Remove roaming charges and more
The bane of the Caribbean Community (CARICOM) is its slowness in getting things done, and how little information, including hard data, it actually shares with its critical stakeholders: the people of the Caribbean. It hardly ever meets deadlines, which is perhaps why when, two years ago, CARICOM’s leaders mandated their officials to accelerate work towards establishing a “single ICT space” in the community, they set no date for the job to be done.
But it seems that this is a matter the 15-member group, which is committed to transforming itself into a genuine single market, may be making progress. This week, its ministers for information and communication technologies announced that they had agreed to “collectively approach” the telecommunications companies operating in CARICOM to eliminate telephone roaming charges for people travelling within the community.
In other words, someone travelling from Kingston to, say, Bridgetown or Port of Spain, or vice versa, wouldn’t pay higher rates, or so-called roaming charges, for calls, text messages or data, from or to a mobile phone for the person who has a contract with a telecommunications company in Jamaica. There, however, would likely be special pricing arrangements to prevent the abuse of the system, such as by someone who moves abroad permanently or for an extended period but continues to use the SIM from home. The penalty charges for such circumstances would be expected to be capped under a “fair use” policy of some kind.
We agree with CARICOM’s secretary general, Irwin LaRocque, that the removal of roaming charges is a “low-hanging fruit” that would help to drive the social and economic development of CARICOM, although, unfortunately, the community provided no data on the volume of inter-CARICOM travel, the amount of time people moving across the region spend on their telephones, or the amount of data they use. Such data is not readily available from a single source and are difficult to accumulate.
CARICOM’s usual lethargy apart, we expect the region’s telecoms will seek to make this fruit difficult to pick. They will argue that the removal of roaming charges will cost them revenue, and profit, required for building out infrastructure and upgrading technology. The same arguments were made for years by European operators, until the European Union (EU) final elimination, in June 2017, of roaming charges among its 28 members as well as their partners in the European Economic Area.
Indeed, while up to half of Europeans switched off data while travelling in the EU, these charges accounted for a not-insubstantial share of the turnover of the union’s telecoms, reaching €8.5 billion in 2005, of which more than two-thirds, or €5.7 billion, went straight to the bottom line. While similar analysis is not available for the Caribbean, we would be surprised, even if not at the same ratios, roaming was not a lucrative enterprise for this region’s telecoms.
Conceivably, the loss of this revenue stream could affect their ability to invest in new technologies and to modernise their systems. The evidence from elsewhere, however, suggests that their elimination is substantially, if not fully, offset by increased service utilisation, which earns the companies money. For example, over the summer of 2017, after the removal of roaming charges in the EU, Europeans used 435 per cent more data while roaming than the previous summer. Mobile phone calls, in minutes, went up 145 per cent. From the first quarter of 2017 to the first quarter of 2018, data use went up fivefold the previous year’s volume.
It is perhaps true that the European trend isn’t readily replicated, to the same extent, in the Caribbean. In our region, people are poorer, intra-regional travel is expensive, and despite the more robust efforts, recently, of Caribbean governments to meet treaty obligations, intra-CARICOM travel is still not hassle-free.
It is in the economic interest of regional telecoms, however, that these hurdles be removed, to which they can contribute by muting resistance to the elimination of roaming charges, and, more important, by engaging the process and pressing governments to get the “single ICT space” done. Information and communications technology, and its interface with artificial intelligence, is the new frontier of economic development. The Caribbean lags far behind in this transformation. It will be more difficult to catch up as individual players than a single community.