Fixed line follies

Between May 31st and June 11th, 10,000 Jamaicans signed up for the pre-paid Home Fone service which eliminates the monthly line rental fee in exchange for higher per minute calls.

And this number is in line with the executives' expectation that this new service would be the fastest take up ever experienced by the company.  "This is a good result within the time frame," said Roger Richards, senior vice- president of Internet, voice, & data.

Now, the service is in response to the hatred expressed by many consumers for the fee imposed for the telephone line to their residence.  But it wasn't just the consumer's emotions that C&WJ were after.  The executives came up with the brilliant idea to listen to what the Jamaican public had to say and give them services that would prove financially beneficial to the company.

At a cost of "north of J$67-$68 million to roll out", Richards states, "the numbers we have already, we are calling a success."  In fact, the executive anticipates "growth in excess of 60 per cent growth in the pre-paid market.  We expect some migration from existing landline customers, but we expect about 100 growth monthly on the early three to four months and then a tapering off to 40 per cent monthly later down."

In fact, Richards hinted that pre-paid service for business customers would be on stream soon as a tool to control phone usage in the workplace.

And one of the major issues in the workplace is the use of company phones for personal use, especially to expensive cellular numbers.

Now, the cold hard fact is that five years ago, the cellular market opened up (read exploded) in Jamaica and C&WJ received a one-two punch.  First, consumers flung themselves at Digicel's feet and took up as many cellular phones as was offered.  By the end of the five- year period, Digicel boasted one million customers.  C&WJ has about 700,000.

But the pain didn't stop there.  Because although Jamaicans embraced the cellular phone, they didn't want to own up to the responsibility of the cost of cell phone to landline charges.  And as president of C&WJ, Rodney Davis admitted at the May 31st launch of pre-paid Home Fone, 75,000 landline customers came off the grid.

But these customers didn't just walk away; they left owing the company for calls made.  Hence, C&WJ not only lost revenue from the switch; even worse, the landline customers that remained used their cellular phones to make long distance calls, further reducing the company's revenue base.

C&WJ extends a friendly hand to ISPs

And it is not just the public at large the company is making friends with.  On Tuesday, the company announced that they would be partnering with four Internet Service Providers (ISPs) to bid for the government contract to supply Internet access to schools, public libraries and post offices islandwide.

Now this is a massive change in mindset for the company as just last August several small ISPs accused the company of using its size to squeeze them out of the marketplace.  The term 'margin gather' was used extensively in public squabbles.

In its own defence, C&WJ informed the press that it had put in millions of US dollars worth of infrastructure in the country and was not obligated to make space for smaller entities who did not put in the level of hard wiring into the country.  But these days C&WJ practices a gentler approach that could be called enlightened self-interest.

Lloyd Distant, vice president of business communication solutions explained, "The government has an e-learning thrust which focuses on improving universal access to the Internet.  This thrust was made possible with the formation of the Universal Access Fund Company."

Now the UAFC is funded by a cess, the Universal Access Fund, imposed on all telecommunications coming into the island.  And as one of the largest, if not the largest contributor to the Universal Access Fund, it would make sense for C&WJ to seek to go after a contract funded by the cess dollars.

However, this is not the big and bad C&WJ of the past.  Now, they are a more gentler, inclusive company.  Hence, Hugh Campbell of Imoquad, an ISP, joined Distant in speaking to the Caribbean Business Report.

Essentially, C&WJ would provide access to the existing infrastructure to government buildings while the ISPs would be the first point of contact for Internet service related issues.  Said Campbell, "There is a change of focus from C&WJ to bridge the gap with the smaller players in the market.

It would be difficult for a smaller player to venture into this alone."  Especially since the UAFC requires a J$6-million deposit along with the bid documents.

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