The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Cable Bahamas saw “amazing” Internet revenue growth in 2012 that beat projections by almost 10 per cent, a senior executive telling Tribune Business yesterday that it was “hitting most of our target numbers for 2013”.

Barry Williams, its senior vice-president of finance, said the BISX-listed communications provider’s Internet revenues grew 6 per cent year-over-year, with 2012 also seeing it make “inroads” into the fixed-line voice market and cable TV “hold its own”.

Confirming that the BISX-listed communications provider completed digitisation of its Bahamas-wide network in December 2012, Mr Williams said the company was now seeking to “maximise the benefits” of its $15-$20 million investment.

And, despite many projecting that sustained economic recovery may be another 18 months away, Mr Williams said Cable Bahamas had “a very good outlook” for the remainder of 2013.

He added that the company could do “even better than planned” if the regulatory authorities, chiefly the Utilities Regulation and Competition Authority (URCA), understood the need to approve an increase in its basic cable TV rates.

Setting aside that setback, Mr Williams told Tribune Business: “Internet is amazing. I’m still being amazed by the growth of Internet.

“Last year, we still saw more growth than we anticipated year-over-year. Compared to then previous year, we were probably north of 6 per cent revenue growth year-over-year.

“And we did beat our plan on Internet by probably, I would say, just under 10 per cent.”

Cable Bahamas’ top-line Internet growth comes at a critical time, as competition in the fixed broadband market heats up. Its major rival, the Bahamas Telecommunications Company (BTC), has targeted the sector as one in which to increase its market share, and the two companies have recently traded allegations concerning each other’s Internet-related advertising practices.

Anticipating the competitive threat, Cable Bahamas has recently announced upgrades to both its broadband Internet download speeds and pricing.

“We’ve pretty much taken it to another level,” Mr Williams said. “The demand for streaming, people downloading large amounts of content, especially on the video side of things, that growth has continued and we’ve seen rising demand from consumers.

“Our network has the ability to scale pretty seamlessly by us changing out the electronics. We’re able to give the highest speeds of anywhere in the world.

“We’ve got the fastest speed, the fastest downloads in the country and, I dare say, faster than a lot of first world cities and major countries.”

As a mature market, and with few new housing developments amid a depressed mortgage/construction market, Mr Williams said Cable Bahamas was expecting its existing 2-3 per cent annual TV subscriber growth to continue for the foreseeable future.

“The bread and butter is still very much holding its own,” he said of the cable TV segment. “That is a mature market for us, and for pretty much the last couple of years we’ve not seen more than 2-3 per cent growth from a subscriber perspective.

“That’s pretty much the way it’s going to continue. We have in the neighbourhood of 90,000 households in the country, and not having a large population explosion, that’s pretty much the kind of growth we’re going to see for the next couple of years.”

Mr Williams added that the newly-launched ReVoice segment had “made some inroads” into the fixed-line phone market since launching in the 2011 fourth quarter.

“It’s been pretty much on track with what our expectations have been on that side of the business,” he told Tribune Business.

“We are making inroads into subscriber growth. We’re still a small player compared to BTC, the incumbent, in terms of number of lines and subscribers.

“We do not have what I would call a significant portion of the market just yet. We’ve got less than 25 per cent. It takes time, but we’re gaining market share, gaining more audience in the voice market, slowly but surely.”

Mr Williams added that Cable Bahamas had met its obligations to fully digitise its network, a move that stemmed from URCA’s insistence that it ‘untie’ its cable TV and Internet products on competition grounds.

The BISX-listed communications provider “accelerated” the digitisation effort from late 2011 onwards, finishing it ahead of schedule.

Tallying up the extra staff required for this, plus the provision of a first set top box ‘free’, URCA audit requirements and network upgrades, Mr Williams said the entire exercise cost around $15-$20 million.

“We are looking to get as much benefit from the change out as possible. We should be seeing some good benefits from it,” he added.

“It’s not the way we would have preferred to do it, but came to an agreement [with URCA] on what needed to be done.”

Looking towards the 2013 second half, Mr Williams told Tribune Business: “We have a very good outlook for ourselves for the rest of the year.

“We’re on track to achieve what we’re planning for the rest of this year. We’ve been relatively conservative in our forecast, and so far, so good. We’re hitting most of our numbers, and I believe we’ll be on track by the end of the year.”

He added: “We never plan to come out less than we were in the past year. We always push ourselves to achieve more and more, and for our shareholders.

“Whether it’s new products, maintaining or reducing costs, we find ways to meet our goals. If we can keep some of these fees down, regulatory fees and signal fees - there’s not a whole lot we can do there - or if we could persuade the powers that be to understand what we know, that we really need a rate increase on the basic TV side, we can do even better than we planned to do.”