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Business Review 2006 from
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Competition spells choice
David Smith,
Cable & Wireless Jersey
Cable & Wireless Jersey has been competing in Jersey's corporate telecoms market for two years.
In that period prices for businesses have been reduced significantly proving the benefits of competition - for example, since we entered the market, the price of a private circuit to Guernsey has halved.
There is a clear mandate from government that competition is a positive thing in all industries which must be encouraged - hence the States has passed a Competition Law and created a regulator (the Jersey Competition Regulatory Authority) to enforce it.
Telecoms is the best example so far of why that is so important, because Cable & Wireless has introduced international expertise and leading- edge technology, while also challenging the prices and service standards of a former monopoly.
This year there will be more exciting developments, particularly in the mobile market.
Our experience of competition in the many other countries where we provide a mobile service indicates that competition brings a greater choice of handsets and tariffs, lower prices, improved network coverage and higher quality service. Competition drives innovation; operators must find new ways of providing value for all customers, or risk losing market share. Ultimately competition can benefit all the businesses involved in the market as well as consumers.
In 2006 we will be introducing a number of products targeted to directly meet the needs of businesses in Jersey.
FirstDial Business, our new fixed line service, will offer up to 50% off Jersey Telecom's standard call rates for companies of all sizes. A consumer version of this product will follow.
We have also introduced the market-leading Blackberry personal digital assistant to Jersey, which has generated enormous interest. It is exactly this type of innovation which businesses are demanding and which Cable & Wireless intends to satisfy.
Delays
However, the development of FirstDial Business has been fraught with delays illustrating why competition requires strong regulation. The value of our FirstDial services is dependent on the ability of customers to make calls between the Jersey Telecom and Cable & Wireless networks. Months ago Jersey Telecom contracted with us to provide interconnection to its network before 18 April, a date we dubbed 'National Value Day'. Subsequently, Jersey Telecom wrote to advise us that there would be a six-week delay. In total, interconnection has now dragged on for seven months, forcing us to ask the JCRA to enforce the timetable. If consumers are to benefit from competition in the shortest time possible, the lesson is simple. Regulation must be competition friendly.
Having improved the business telecoms market we've always intended to bring Cable & Wireless's international mobile expertise to the Island.
When Ofcom and the JCRA decided to award mobile radio spectrum to Cable & Wireless in December 2005, they guaranteed the end of one of the last mobile monopolies in Western Europe. As a result, we have committed to launching a mobile service which we believe will offer greater choice, better value and increased innovation for all mobile customers.
The service hasn't launched yet and already Islanders are excited because of their impatience for change. Our market research indicates that 91% of mobile users support competition. 90% of those surveyed complained that present mobile phone call charges are too high, while 98% of those who have used a mobile phone when outside the Island feel that it is expensive to make and receive calls.
Both these statistics are unacceptably high and so the introduction of a second network must be a priority so that both operators will be encouraged to offer truly competitive pricing.
To assist this process, here again regulation must be competition friendly. Jersey has liberalised its mobile market at a much more mature stage than in other countries. Nearly 100% of Islanders are already Jersey Telecom mobile customers. That fact obviously presents its own challenges with regards to the introduction of real competition.
Sharing
Mobile users must have a free choice of the best value service. To have that, they must be allowed to keep their number when moving between networks. 94% of Jersey Telecom customers who we surveyed indicated that they want this facility. So, after consultation with the JCRA, we have offered to share equipment worth £350,000 to facilitate the implementation of mobile number portability in Jersey at no cost to consumers.
90% of mobile customers have also indicated that they would like better signal coverage from a new mobile network. Building a second network is absolutely necessary if Islanders are to enjoy competition. Overall we require around 45 cell-sites in order to create the high-class network which consumers want, but we are very sensitive to the environmental concerns. That is why we have decided to share more than half of the sites we will use, primarily with the States of Jersey and other utilities providers.
Wherever possible we will seek to use existing structures for the remaining sites as an alternative to building new masts to gain height for the antenna. With techniques such as colour coding, a mast will, as far as practically possible, be designed to blend into the surroundings.
We are also committed to staying well within recognised international safety guidelines. Cable & Wireless has a strong international reputation for safety and by working well within the guidelines of the International Commission on Non-Ionising Radiation (ICNIRP), we surpass the recognised safety standards by a significant margin.
In all industries, competitive activity will lead to the same results - better service, increased value, innovation and above all a choice for consumers. The people and businesses of Jersey deserve these benefits. However, in order to achieve this goal government, regulators and Jersey Telecom must all exhibit a real commitment to acting in the interests of consumers.
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