The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Cable Bahamas yesterday hit back at the Bahamas Telecommunications Company (BTC) with its own accusations of alleged “anti-competitive behaviour”, as the battle for broadband Internet market dominance heats up.

Dave Burrows, Cable Bahamas’ head of marketing, responding to BTC’s decision to file a complaint against it with the Utilities Regulation and Competition Authority (URCA) over the alleged breach of a $150,000 marketing contract, accused its main competitor of running “misleading advertising” for its Internet product.

He added that Cable Bahamas had filed numerous complaints about BTC’s alleged competitive behaviour with URCA previously, some going back more than a year.

Denying BTC’s latest ‘contract breach’ allegations, Mr Burrows suggested the issue had more to do with Cable Bahamas’ competitiveness on broadband Internet.

Sensing the competitive threat from BTC, Mr Burrows said Cable Bahamas’ Internet speed was now nine times’ faster than its rival following recent upgrades, with the BISX-listed communications provider’s pricing fives times’ lower.

He told Tribune Business: “At this time, Cable Bahamas has numerous complaints against BTC with URCA due to their ongoing anti-competitive behaviour, including misleading advertising about their DSL service, with some of those dating back almost a year.

“We continue to work with the regulator regarding all of these issues, rather than fighting those battles in the press.”

BTC had accused Cable Bahamas of anti-competitive behaviour intended to cause it “loss of market share” in broadband Internet, claiming its main rival had breached their $150,000 advertising contract.

BTC’s June 4 complaint to the Utilities Regulation & Competition Authority (URCA), a copy of which has been obtained by Tribune Business, accuses its BISX-listed competitor of “abusing” its existing cable TV monopoly to restrict BTC’s competitiveness in the broadband Internet segment.

The complaint, filed by Felicity Johnson, BTC’s senior vice-president of legal and regulatory affairs, is alleging that Cable Bahamas has both breached their advertising contract and violated several provisions in the Communications Act and accompanying competition/Significant Market Power (SMP) regulations.

Setting out the background to the complaint, Ms Johnson said BTC had signed a year-long $149,897 advertising contract with Cable Bahamas’ marketing arm, Cable Media, for commercials to air between June 15, 2012, and June 14 this year.

However, she alleged that the DSL/high speed broadband adverts containing “testimonials by users of the service” were not being screened by Cable Bahamas in the authorised spots, despite having been sent in on April 11, 2013.

BTC then alleged that Cable Media’s manager, Lia Head, told it in a May 3, 2013, e-mail that the Internet advertisements were “the competing ads that were now allowed to run because of our non-competing agreement”.

However, BTC’s complaint alleged: “Cable Bahamas has leveraged its dominance in the television market, as itself a ‘customer’ of the television market, as is BTC, in order to prevent BTC from effectively competing in the provision of broadband service.

“It is important to appreciate that Cable Bahamas’ television side of the business provides services, advertising, to both Cable Bahamas telecoms side of the business and BTC.

“Thus, in effect, Cable Bahamas’ telecoms or broadband business and BTC are both ‘customers’ of Cable Bahamas’ television service.

“By allowing its television side to do business with its telecoms side of the business to the exclusion of doing business with BTC, Cable Bahamas in effect is ‘applying dissimilar conditions to equivalent transactions’.”

In response, Mr Burrows told Tribune Business: “Nothing has changed regarding Cable Bahamas’ advertising policies with BTC.

“What has changed in recent months is that Cable Bahamas has delivered a far superior broadband Internet product to the market. We now offer our residential customer speeds that are almost nine times faster than BTC’s fastest speed.”

And he added: “We are offering broadband Internet service that is among the lowest cost in the world, as low as $1.41 per megabit. BTC is selling services that cost as much as $7.50 per megabit.

“Comparing average broadband Internet speeds, the Bahamas has moved from the 87th in the world to 46th because of the speed increases that Cable Bahamas launched in April. The Bahamas is now the third-fastest in the Western Hemisphere, after the US and Canada.

BTC’s concerns seem to have more to do with the competitiveness of our product than they do with any legitimate anti-competitive decisions that Cable Bahamas has made about our television advertising platform.”

The dispute filing comes as competition between the two companies for broadband Internet market share heats up.

Cable Bahamas has long been the dominant player, with a market share estimated around 75 per cent, but BTC’s new majority owner, Cable & Wireless Communications (CWC), has targeted broadband Internet as something it can make major inroads into.

BTC’s chief executive, Geoff Houston, told this newspaper earlier this year that the carrier aimed to leverage its new Internet Protocol (IP) TV product (still in development) “to gain a market leading Internet position”.

This will be facilitated by BTC’s Next Generation Network (NGN), with Mr Houston adding that the company should never have let its Internet broadband market share drop to 25 per cent.