The Tribune

The Bahamas Chamber of Commerce's chief executive believes "there is space for another mobile player", and is urging the Government to issue a third licence come 2019.

Edison Sumner told Tribune Business that the high level of mobile communications penetration in the Bahamas, coupled with the expanded market created by millions of tourism, meant there was sufficient demand to support a third operator.

"I'm still hopeful, as the Government indicated before, that they will introduce a third operator in the next three years or so, as they did specify when launching the liberalisation," he told Tribune Business.

When asked whether there was a sufficient consumer base, given the Bahamas' 350,000-strong population, to support three operators, Mr Sumner replied: "Absolutely.

"We are one of the largest per capita users of mobile phones and devices anywhere in the hemisphere," he added, suggesting there were almost three cell phones per Bahamian.

"There's a market for it, there's a profit for it. Apart from providing cellular services, mobile services; it goes beyond that to mobile data. Data is where it's at."

With the rapid growth in 'smart phone' and ipad usage, Mr Sumner said: "In years to come, cell phones will become a thing of the past and obsolete. The whole society will move to data usage. Everything we do is through data."

He argued that there would be a shift to Internet Protocol (IP) engineering, and added: "Those who provide good data services will do well in this market.

"I believe there is space for another player, and hopefully we'll see a third provider coming into the market. We still have to cater to millions of tourists and visitors coming to our shores every year, and they need the provision of data."

Many, though, are sceptical that the Bahamian market is large enough to support more than two mobile providers, who are the Bahamas Telecommunications Company (BTC) and the soon-to-be launched NewCo2015, which is controlled and managed by Cable Bahamas.

Figures supplied by sector regulator, the Utilities Regulation and Competition Authority (URCA), showed that mobile subscriber numbers and revenues for BTC, currently the monopoly provider, both fell in 2015.

The total number of mobile subscribers in the Bahamas fell by 1.16 per cent year-over-year, from 314,842 or 311,175.

And as a result, mobile penetration rates (the number of subscribers per 100 individuals) dropped from 86.50 in 2014 to 85.49 in 2015.

Meanwhile, BTC suffered an almost 30 per cent or $77 million year-over-year fall in mobile revenues, which dropped during 2015 to $175.965 million from $253.301 million.

This was blamed on the reduced subscriber numbers and increasing use of Over The Top (OTT) applications, which shifted revenue from mobile voice and messaging services to mobile data , which earns less revenue.

OTT applications are apps or services, such as WhatsApp, Skype and Netflix, that provide a product over the Internet and bypass traditional distribution.

Mr Sumner readily acknowledged he had a personal interest in any third mobile licence, given his position as chief executive of IP Solutions International (IPSI).

IPSI had been expected to join the race for the second mobile licence, and partnered with international operator, Limitless Mobile, in preparation to make a bid.

However, it ultimately decided not to participate after finding the terms in the Government’s Request for Proposal (RFP) “too onerous” - especially the aggressive network roll-out timetable, and the requirement that the winning bidder relinquish a majority 51 per cent stake to Bahamian investors.

The RFP for the second mobile licence, though, pledged that the Government would delay the entry of a third operator until “at least three years” after the second one has begun commercial operations.

Given that NewCo's licence was signed on June 30/July 1, this means that it must launch services to 99 per cent of New Providence's population, and 80 per cent of Grand Bahama's, by end-September/October 1 to meet its licence conditions.

This, in turn, means no third provider could enter the market until the same point in 2019.

However, the Government will have to amend the Communications Act’s section 114, as this only mandates that it cannot issue a licence to a third cellular operator until April 2016 - a date now passed, and before NewCo will begin services.

“The Government intends to amend the Electronic Communications Sector Policy to delay the entry of a third cellular mobile operator for at least three years from the commercial launch of the second mobile operator,” the second licence RFP said.

The RFP also made clear that much market analysis remains to be done to determine if the Bahamian market can sustain three players.

“Before any decision is made to initiate a process for licensing a third mobile operator, the Government will consider such factors as it deems necessary,” the tender documents state.

Mr Sumner said it was "great" that the long-running mobile liberalisation process was finally ending with the second license's issue to NewCo and Cable Bahamas.

"This hopefully will bring better competition to the market, lower prices and improved customer service and experience, both with NewCo and also, BTC," he added. "I'm hoping the customer experience is going to be better for both these services. Time will tell."

The Chamber chief executive congratulated Cable Bahamas for winning the second mobile license, while also praising BTC for launching its Flow TV product.

"I'm pleased to see the direction they're moving in," he said. "I've been advocating for advancing the IP infrastructure in the country, and it's good to see these kind of advances being made."