Almost a quarter of Cable & Wireless Jamaica's mobile phone customers will have to buy a new unit by December and will have to buy another new phone if they want to switch to a rival service early next year, it emerged this week.
An estimated 43,000 mobile customers, out of a total of 177,000 existing C&W customers will have to replace cellular phones by the start of its full digital service on December 1, according to C&W's senior vice-president in charge of mobile telephone service Stephen Twomey.
The news that such a large portion of existing mobile phone users will have to buy a new phone that will not work if they wish to switch months later to a different carrier has forced the Office of Utilities Regulation (OUR) to take a fresh look at its position on the move.
Seven days ago Mr. Twomey announced that C&W would as of July 17 suspend accepting new customers until September 4. He also said the company was spending $735 million upgrading its system to improve service to a full, "clone-free" digital network by December 1, 2000, which would mean that those 43,000 analogue cellular customers have to change phones.
The company said the rapid growth in mobile phone calls had stretched its system to a limit. The closure to new phone subscribers would allow for upgrading and a vast improvement in capacity.
Mr. Twomey said the implementation of the latest plans would increase C&W's network capacity to be able to cope with 300,000 customers. He estimated that C&W had about 200,000 customers at present, which was detailed by the Office of Utilities Regulation as closer to 177,000.
The upgrading will give C&W coverage over about 63 per cent of the major population areas and 57 per cent over major roads. Mr. Twomey added that C&W plans to have about 80 per cent coverage through its network by the end of 2001.
But it has emerged that one of the side effects of C&W's move is that the 43,000 cellular customers will now have to chose whether to stick with C&W and buy a new phone or wait for an alternative that is not yet up and running.
At the heart of the problem is the different technologies that the mobile phone players will use.
C&W uses a platform called TDMA, popular in the US, while Mossel will use GSM, favoured by European firms as the technology of the future. Cellular One is yet to declare its hand but is expected to use GSM or another alternative CDMA.
The use of different platforms does not stop phone calls between customers using the different networks. However, C&W customers with TDMA phones will have to buy new phones if they want to switch to Mossel and vice-versa.
This was always known but the decision to move the implementation date forward means that as many as 43,000 existing C&W customers now have to decide to buy a new phone by the end of November. They would have to buy another cellualar phone if they wanted to use Mossel or Cellular One.
The fact that almost a quarter of C&W's existing mobile customers will have to change to a new phone just weeks before the new players' services become active has raised concerns.
Office of Utilities Regulation head Winston Hay had initially said his organisation was not made aware of the changes but would have "appreciated" advance notice. He had told The Gleaner earlier in the week that he viewed the move as a C&W business decision.
When asked about the fact that such a large percentage of callers would have to make a choice of which technology to support so soon before the new entrants were able to offer an alternative, Mr. Hay admitted that the OUR had not looked at this question. He said his organisation would immediately address the issue, which is likely to raise fresh concerns about C&W's monopoly position.
Mr. Twomey said the timing of the move had "worked out well" and would allow C&W to offer a much better service. The mobile boss said on Wednesday: "If I told you this had nothing to do with competition you wouldn't believe me". He added that C&W was in the middle of the second year of implementing a three-year business plan and that the onset of competition had increased the pace of that implementation.
C&W's announcement came just days after Wednesday Business revealed that Mossel was planning to be up and running by the end of the year. Mossel is expected to begin a US$15 million job of erecting 100 signal towers dotted throughout Jamaica, with another 20 towers erected soon after.
Mobile phone use has been one of the fastest growing areas of C&W's local business.
Mr. Twomey told journalists on Friday: "We have tripled the number of telephone calls in the past 18 months".
Cable & Wireless estimates that the greatest growth - about 80 per cent - in the mobile market came in pre-paid business increasing the number of customers using the pre-paid facility to 100,000.
