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LETTER OF THE DAY - Telecoms takeover dangerous

Published:Friday | March 25, 2011 | 12:00 AM

THE EDITOR, Sir:

I would like to add my voice to those who oppose the recently announced purchase of Claro by the dominant cellular and broadband provider in Jamaica, and possibly the Caribbean, Digicel.

While Digicel claims that the sale is subject to the approval of regulators (I presume our useless OUR - the Office of Useless Regulators), based on recent reports in the media, Digicel anticipates, with good reason, that this approval will be granted as it has commenced the incorporation of Claro's network.

My interpretation of this action, and that of any reasonable person, is that Digicel's announcement that the purchase was subject to the approval of regulators was, at best, disingenuous, or worst, was meant to allay the genuine concerns of the employees and subscribers of Claro.

I am against this transaction as this sale reduces competition, employment and innovation.

Digicel is currently the dominant player in the telecommunications market in Jamaica and has the highest cellular and broadband rates. Claro is the smallest player, yet it has the lowest cellular and broadband rates. Claro has been at the forefront in advocating the reduction of the rate Digicel charges for calls terminating on its network from other providers. In addition, Claro has advocated the portability of telephone numbers across networks.

Digicel, as the dominant player in the market, has vehemently opposed this call. The reason for Digicel's opposition is understandable, as Digicel does not want its subscribers to move with their telephone numbers to a competitor. In other words, Digicel has no problem with Jamaicans walking around with several phones always trying to ascertain who is on which network in order to save money.

This sale will result in the reduction of competition, which will translate into higher rates to the consumers.

This sale will result in increased unemployment in these dire economic times, as Digicel has given no assurance that it will absorb all the employees of Claro and/or the latter agents and their employees.

Competition and innovation

Finally, competition always translates into innovation, as competitors are always finding ways to improve their products to satisfy their customers and attract new ones. This sale will result in a lesser need to innovate, as there will be no real competitor.

It is about time that the relevant regulators in our country step up to the plate, stop being cowards and give a resounding no to this sale.

I am, etc.,

PERCIVAL A. CLARKE

percivalclarke@hotmailcom

Montego Bay, St James

Coming Sunday ...

Many consumers are worried about the Digicel-Claro deal. But Dr Densil Williams believes much of the alarm has been fuelled by hype. Read his perspective in The Sunday Gleaner's In Focus section. It's provocative!