CABLE & WIRELESS Communications (CWC) chief executive officer Phil Bentley recently answered several questions related to the company’s operations and its plans for Barbados and the Caribbean this year. Following is the second part of that interview.
Your competitor Digicel has charged that a combination of LIME and FLOW in Barbados and the region would give it an unfair advantage. In fact they assert that in Barbados’ case, the combined entity would have a monopoly on certain services, including fixed line service, home internet, and pay television via fibre. What’s your response?
We believe it is anachronistic to look at it in terms of these old market definitions of fixed line because the demand for this service is declining as customers switch to mobile; it’s all about “voice.” And it’s wrong to say we’re a monopoly on TV – there’s Direct TV, MCTV, Netflix and many more ways to watch TV these days.
Do you think you have advanced a compelling enough argument to get the acquisition/merger approved?
We believe all stakeholders will see the main benefit of the proposed merger; namely that it will boost investment, competition and customer service by allowing us to compete more effectively in a challenging and evolving market, as the second largest provider.
As I’ve said, this will allow us to invest USD$400 million in broadband expansion, building the most extensive fibre infrastructure ever constructed in our region. We trust and believe that the regulators will take a balanced view of this merger and the multiple benefits it will bring including more jobs and better service.
What is likely to be your next course of action if the acquisition/merger is not approved in Barbados?
We do not want to pre-empt the outcome of the regulatory process, but we remain confident that all stakeholders will see the benefits the business combination will bring to Barbados and the economy.
Realistically, how much room is there for growth in Barbados and where do you see those areas of growth here?
We see a lot of opportunity for growth. Broadband penetration is a catalyst for economic development and there is a lot of head room for improvements. Bajans – businesses and consumers alike – are looking for better services and more choices.
Number portability; no contract service offering; net neutrality and ‘over the top’ (OTT) services; quad-plays offering a seamless service and one single bill; a stronger TV offering; and specifically for business owners- the region’s best corporate data network and route diversity, are all in high consumer demand the industry needs to satisfy.
All this means that there is a huge growth opportunity and vast market potential for all players to compete for.
For many decades Barbados and the Caribbean used to be areas of major interest and revenue for Cable & Wireless. There has been the view that C&W turned its back on the region to focus on other regions. What is the principal reason for what appears to be renewed interest in the Caribbean market?
CWC has always been committed to the Caribbean. It is true that we needed to have invested more and also to have done this earlier; it’s also true that we needed to have placed greater emphasis on customer service, but we are changing that. With this change comes a renewed focus and commitment.
Over the past two years, we have divested significant assets in other parts of the world to refocus our business on the Caribbean and Latin America. By divesting other non-core parts of our business we have freed up room on our balance sheet to invest heavily in the region.
Over the past two years we injected approximately US$600 million in capital investment in our markets and, at the beginning of this financial year, we announced our US$1.05 billion three-year capital investment programme, Project Marlin, which will further upgrade our networks and services in the Caribbean and Latin America.
We have consistently brought the latest technologies and newest devices to our customers, keeping them in pace with, or in some instances, ahead of some parts of the world.
Various people have been commenting on the region’s economic performance and the 2015 economic outlook. From C&W’s perspective, what’s your assessment of the economic performance of Barbados and other Caribbean countries?
We are hopeful about the economic prospects of Barbados and the region and are encouraged by news from the Central Bank of Barbados which has predicted two per cent growth in 2015, rising to 2.3 per cent in 2016.
Tourism is an important driver of the Barbadian and regional economy. In this respect, I think it is important that our key markets and trading partners, including the UK, Canada and the US, are all showing strong economic growth.
The latest US figures are especially promising – five per cent for the last quarterly reading, the fastest pace of expansion in 10 years. The Caribbean is heavily reliant on tourism, especially from North America, so this outlook will hopefully auger well for the industry and the economies.
Telecom also has a pivotal role to play in driving and enabling that growth.
Has this affected investor confidence and if so what needs to be done to get more investment into Barbados and the region?
I believe investors are looking for one thing above all others wherever they invest around the world and that’s stability – which is a rule of law. Frankly, I think Barbados and the wider region provide the desired stability for investors. And, coupled with their skilled labour force, it means that Barbados and the Caribbean are good places to do business.
Improved communications are also vital to attracting more investment and for driving economic growth. Businesses need reliable, fast, competitively priced broadband. It is therefore crucial that we enhance broadband offerings – including speed and penetration – across Barbados and the wider region.
