A $1,200 telephone bill prompted Sebastian Stephens to begin building a Caribbean telecommunications network.

Mr. Stephens, who had previously built a telecommunications network across 18 European countries, said paying more than $1,000 for telephone calls showed him there was a need for a shake up of the region's telecommunications sector.

The Caribbean has only one real telecoms provider - Cable and Wireless (C&W) - who have long had a monopoly in the region.

In the mid-1990s, Mr. Stephens founded Wisper.net, a privately owned data network in Europe that offered wholesale international Internet Protocol (IP) sales. The network covered eighteen countries with both satellite and fibre links and was sold in 1998 to INSnet.net and subsequently became the Cable and Wireless European network.

On seeing that there was a need for competition in the Caribbean, Mr. Stephens set up the DataState Group - a Bermuda-based company established in 2000. As for choosing Bermuda as the company's place of incorporation - over a Caribbean jurisdiction - Mr. Stephens said the Island was an obvious choice given its credible standing as an international business jurisdiction.

DataState is, in turn, the shareholder and fund provider for subsidiary company BlueStream Communications - which is incorporated in the British Virgin Islands but operates from Grenada - and is responsible for the actual building of a Caribbean telecommunications network.

DataState has so far invested more than $1 million in BlueStream.

Although BlueStream has yet to make a real dent against the C&W empire - the company has a number of license applications pending and hopes to go live in 2004 - Mr. Stephens said the company is well on its way.

Mr. Stephens explained that the area is slowly warming to the idea of competition in the telecommunications sector. He added that the sector's deregulation was expected by 2005.

Ultimately Mr. Stephens said greater competition in the telecommunications field is key to the Caribbean's economic success - with companies reportedly backing away from business in the region given the state of its telecommunications sector.

Although conceding that building the network and the process of breaking into the area's locked-up telecommunications arena was taking time, Mr. Stephens said the company had been careful not to "haemorrhage" its money by finding other revenue streams.

One of the ways the company has made money in the meantime is by setting up telemarketing call centres.

BlueStream marketing director Richard Carruthers - who was recently on the Island along with Mr. Stephens to touch base with their lawyers and bank - said BlueStream had built the infrastructure for the call centres and then turned them over for operation by Government or the private sector. Mr. Carruthers said the call centres collectively employed more than 1,000 people.

He added that BlueStream was committed to not only being a commercial success in the Caribbean, but also providing socio-economic benefits by creating jobs and "plowing money back" into the region.

In September the company moved one step closer to its goal of establishing itself as a telecoms player when it secured a loan of some $1.5 million, earmarked for its continued expansion into the region. The loan was from the Royal Bank of Trinidad and Tobago.

So far the company has access points on six Caribbean islands -Antigua, St. Kitt's, St. Vincent, St. Lucia, Grenada and Trinidad - as well as network centres in the US and UK. Through a separate subsidiary - Island Fibre - the company aims to have its cable go live in the next two years, but the task comes with a hefty price tag of some $120 million.

But Mr. Carruthers said their plan had received strong support with some $25 million in pre-sales on their still being built network.