The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Cable Bahamas is arguing its ‘significant market power’ designation in the pay-TV market is “screaming for removal” with competition from streaming services having caused an 11 percent plunge in subscriber numbers in 2021.

The BISX-listed communications provider, in its response to the Utilities Regulation and Competition Authority’s (URCA) consultation on the latter’s draft annual plan for 2023, sought to make the case for a softening of its regulated status given the inroads made by the likes of Netflix and Hulu.

Asserting that URCA’s long-promised review of the pay-TV market and other fixed services is “critical”, it added that its core heritage product had “shown the steepest decline in subscribers at 11 percent year-over-year. The review has implications for the Significant Market Power (SMP) designation, which is screaming for removal with the competition from the grey markets such as Netflix, Hulu etc. and the addition of competition in this market since 2016.

“This review has been listed and subsequently cancelled on an ongoing basis since 2018. When reviews are consistently postponed, data collected for the purpose of the review becomes stale dated and must be collected again. At the present time Rev (Cable Bahamas) is not optimistic that the review will be completed with a final statement of results by the third trimester of 2023 as indicated by URCA.

“The group calls for the escalation of this review in the plan so that it can be addressed with the urgency which it deserves.” Cable Bahamas has long been designated as having SMP in the provision of pay-TV services due to its dominant majority market share, which was built up over a 15-year exclusivity, and the Bahamas Telecommunications Company (BTC) only a relatively recent rival to enter the sector.

Companies with SMP designations are subject to close regulatory scrutiny and controls because their dominant market position means they can potentially adopt practices that squeeze out competitors to the detriment of consumers. Cable Bahamas’ submission is essentially advocating that it be subjected to less onerous restrictions in that segment.

Elsewhere, Cable Bahamas queried URCA’s decision to seemingly drop its review on the impact of over-the-top (OTT) applications such as What’s App “without explanation”. And it described development of a national spectrum plan for 2024-2027 as “of the utmost importance to the sector”.

“The revised Spectrum Plan will be most relevant to wireless networks, in particular, including 5G and the new and fast developing satellite to mobile industry, which is being pushed globally by new commercialised satellite companies and cannot be ignored,” Cable Bahamas said.

“The group, as have indeed many telcos globally, has been advocating for a review of the spectrum rules and pricing and the removal of the ‘Premium Spectrum’ category which charges significantly higher fees for what is determined to be premium band spectrum.

“Given that the Government and relevant minister is responsible for determining spectrum fees, certainly this is a project which requires that URCA educate the relevant officials on recent global approaches to policy in the spectrum area so that informed decisions may be made. As cellular mobile operators begin to prepare their business cases for 5G services, the expeditious completion of this new national spectrum plan is essential.”

The threat from “commercialised satellite companies” may already be here in The Bahamas. For on February 15, 2023, URCA granted a class operating licence and class spectrum licence to Starlink Services Bahamas, which was represented by the Lennox Paton law firm. Starlink is an affiliate of Elon Musk’s SpaceX, which is not only seeking to offer satellite Internet services but also mobile services.

Meanwhile, Cable Bahamas also voiced concern at what it described as high staff turnover at URCA. “Building stakeholders’ confidence as a part of URCA’s activities begins with the knowledge that URCA consists of skilled employees with requisite specialised expertise in regulation who are retained over a period of time and build institutional knowledge in order to keep abreast of the demands of a dynamic industry,” it said.

“The employee turnover at URCA has been a cause of concern for some time, and we trust that URCA carries out exit interviews to better understand the reasons. Perhaps it is time for URCA to take an in-depth examination of the organisation as a whole in order to identify the systemic reasons for such high turnover, particularly in certain areas which, by URCA’s admission has impacted its ability to start and complete projects particularly in the past two years, causing a carry over of more than 50 percent of the 2022 projects which will surely impact the competition of the 2023 projects.”

The Bahamas Telecommunications Company (BTC), in its response to the URCA consultation, called on the regulator to address the unreliable supply of electricity by Bahamas Power & Light (BPL) in the Family Islands. “BTC is concerned about the apparent lack of monitoring and improvement in this area,” it said.

“BTC has stated previously that the lack of reliable and quality electricity especially in the Family Island is the number one challenge facing electronic communications sector operators in The Bahamas. Operators are forced to manage and maintain redundant sources of electricity in order to run their networks, a situation that is akin to electronic communications sector operators providing telecommunication services as well as being power generation companies.

“This issue continues to be the source of often and prolonged interruption of telecommunication services in many parts of the archipelago. The result is that it shortens the life of electronic communications sector equipment and it deprives the sector of investment which could otherwise be used to improve the level of services in underserved communities.”