Karib Cable and Flow: can these two companies change the ...

Within weeks of each other, Karib Cable and Columbus International announced their imminent entry into the Barbados telecom market. Both are planning to offer triple play, but considering their track records in other countries, what might be in store for Barbados?

Table 2: 2012 NRIs for the top 10 ranked countries and select Caribbean countries (Source: WEF/INSEAD)

For those of you who are regular readers of ICT Pulse, particularly our Snapshot series, you might have noticed an anomaly for one of the countries: Barbados. Barbados, with a population of approximately 287,000 and an estimated per capita GDP, of USD?15,000, tends to be highly ranked in a number of ICT-related international assessments. For example, in the Global Information Technology Report (GITR) 2012, produced by the World Economic Forum (WEF) and INSEAD, which measures network readiness, Barbados was ranked 35th out of 147 countries . Moreover, it was the third highest ranked countries in the Americas, behind the United States and Canada.

However, key deficiencies the assessment highlighted?in Barbados were the high prices for broadband services, along with the limited competition in telephony and Internet services. In addition to affecting its global ranking, these limitations have been affecting the country?s competitiveness, although it has been able to create a favourable business/investment environment.

When that GITR was completed, there were three Internet ISPs in Barbados: LIME, Sunbeach Communications?and Telebarbados. However, as our most recent Snapshot of Internet speed and spend and broadband affordability indicated, granted that the focus was on LIME and Sunbeach Communications,

• the monthly subscription for 2 Mbps Internet service plan was one of the highest in the region ? behind the British Virgin islands, Turks and Caicos islands, Cayman Islands, and Antigua and Barbuda
• a 2 Mbps plan would not be particularly affordable to the average Barbadian consumer, as it equates to around 6% of a person?s monthly income
• High Speed Broadband (plans offering transmission speeds of over 12 Mbps) is not available to residential customers in Barbados.

New players to the market

However, recent announcements are likely to have a significant impact on Barbados? Internet landscape. First Karib Cable, which originated in Saint Vincent and the Grenadines, and also operates in Saint Lucia and Antigua and Barbuda, plans to launch service in Barbados within the next 3?4 months. The company currently offers triple play (voice, Internet and subscriber TV services) in Saint Vincent and Saint Lucia, and is considered a welcomed addition to the Barbados telecoms market:

?Karib?s leading edge fiber optic technology will provide a best-in-class infrastructure for all Barbadians. Moreover, the new network will enhance Barbados? reputation as being one of world?s pre-eminent international business centers. By improving our telecommunications network, Barbados will improve its ability to attract, win and sustain investment for Barbados,? said Wayne Kirton, CEO of Invest Barbados. ?(Source: Yahoo Finance)

Second, and perhaps more importantly, Columbus International Inc., which offers services in the region under the brand, ?Flow?, has entered into an agreement with Caribbean Fibre Holdings. The result will be the transfer of ownership of TeleBarbados Inc., Tele-St. Lucia Inc. and Wamco Technology Group Limited. The transfer of ownership and existing telecoms licences to this new owner will most likely be subject to regulatory approval in both Barbados and Saint Lucia. However, this deal has the potential to substantially improve the speed and availability of Internet service in Barbados in particular, along with its regional and international competitiveness.

Potential impact

With Karib Cable?s entry, Barbados will have four?ISPs. However, based on the pricing structure and transmission speeds the company currently offers in the countries it already serves ? up to 4.4 Mbps for between USD?90 and USD?215 ? its likely offerings in Barbados in the first instance, might not be a major improvement from what currently obtains.

On the other hand, Flow currently offers up to 100?Mbps to residential customers in Curacao, Jamaica and Trinidad and Tobago, for between USD?142 and USD?223. Further, noting that TeleBarbados already has some fibre networks deployed, Flow could realise a relatively early launch in Barbados. Hence, it could potentially offer competitively priced high speed broadband in Barbados, similar to other countries in which is operates, thanks to lower network costs, which could potentially result in a more favourable return on investment

More importantly, although Flow, and the other companies and brands under the Columbus group of companies might not be widely known within the Caribbean, Columbus Communications is a major stakeholder in the submarine cable networks in the region. As shown in Figure 1, it is either the full owner (as Columbus Networks) or an investor in others. This means that it has ready access to considerable international bandwidth to connect Caribbean countries to the internet and other major exchanges.

Figure 1: Columbus Communications? submarine cable footprint (Source: Columbus Communications)

In summary, the imminent entry of Flow/the Columbus group of companies into terrestrial networks and the provision of services in Barbados and Saint Lucia, does highlight the company?s continuing interest and focus in the region. When coupled with its extensive sub-sea infrastructure; ability to offer of high speed broadband at relatively prices; along with its triple play offerings, Columbus International has the potential to be the leading provider of data services in the Caribbean region.

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3. From bus stop to rum shop: how Barbados plans to achieve 100% Wi-Fi coverage
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