Sir, – I refer to your article "Digicel warns of scaling back in the Caribbean" (December 9th), which displays a serious lack of understanding of the telecommunications landscape in that region and also arrives at several misplaced conclusions.
Digicel chose not to acquire Columbus Communication because we did not believe it was worth in excess of $2 billion. Cable & Wireless Communications are proposing to pay over $3 billion for the business which we believe is excessive – but that is their business. The real issue, however, is that unlike Digicel, which is predominantly in the mobile space, Cable & Wireless Communications and Columbus combined will result in several monopolies in their overlap markets.
As is the case with any transaction which will result in monopolies or virtual monopolies, this proposed transaction needs to be very carefully examined by the relevant regulators and appropriate measures taken to ensure that there is no abuse of the pro-forma monopolies which will be created in six countries. Indeed this has been recognised by the Eastern Caribbean Telecommunications Authority, which stated last Friday that, “In the review of the proposed merger the ministers noted that potential new scenarios will emerge where monopolies or near monopolies will exist in the provision of fixed network services which will have an impact on both residential and business consumers.”
Your statement that we “would also have had a stranglehold on certain segments of the market in the region, instead of CWC” is simply not true. It is also wrong for you to conclude that we need time to “formulate a strategy to respond” to the proposed transaction. Our strategy remains unchanged. What we do want to ensure is that the appropriate consumer and industry protections are put in place so that we can pursue that strategy in the knowledge that there will be a level playing field for new entrants like ourselves. – Yours, etc,
COLM DELVES
Group Chief Executive
Officer, Digicel Group .