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Telecoms regulation chief: Expect lower prices and one-stop shopping

One-stop shopping for phone, internet and TV, lower prices, getting the internet speed you pay for and number portability — a dream come true for Bermuda residents that’s expected to finally arrive in phases from April 28.

Philip Micallef, chief executive of the new Bermuda Regulatory Authority (RA) for Telecommunications, agrees reform of the Island’s $210 million industry has taken longer than usual and we are paying more than we probably should for calling, surfing and cable TV.

“I think prices are high because there is not enough competition,” Mr Micallef said in an interview yesterday, adding that he is confident reform will change that, and increase the quality of service, which will be good for not only the consumer but in attracting international business to Bermuda.

However, he said, reform will roll out from a good starting point with as many as 21 providers already offering different telecoms services under their respected licence classes.

And he and RA chairman Kent Stewart also praised the Government legislation that paved the way for reform calling it “excellent” and “modern”.

Mr Micallef comes to the Island from Malta where he was executive chairman of the Malta Communications Authority. Residents there now have a website that allows you to compare prices of all the various telecoms services from the different providers — you can even compare bundles.

One of the biggest challenges for Bermuda, he said, is its small size which pushes up costs for the providers in terms of investing in infrastructure and equipment.

The RA expects to release a consultation document next week on who the dominant players are in the Island’s telecoms industry.

Providers deemed to have Significant Market Power (SMP) will have certain obligations under defined “remedies” to ensure a level playing field for ICOL holders.

“If you have SMP, there will be certain strings attached,” Mr Stewart said.

For example, if you are deemed to have SMP in internet service, or cable, you may be required to offer wholesale product to other providers.

“If not, there is a serious risk that one cannot guarantee effective and sustainable competition for the benefit of the consumers with regard to price, innovation and choice and small players may not have a true opportunity to compete,” Mr Micallef said.

Once the consultation document is discussed the RA will be ready to issue ICOLs as of April 28, the latest date set by Government for their issuance. That is slightly later than the March date set under the previous PLP Government.

From that date, the providers who are issued ICOLs are free to start announcing new services and bundling of their services, though they will be regulated if they have SMP.

Mr Micallef discussed some of the major challenges of the reform process.

Number portability

He said a top priority is the issue of number portability, allowing consumers to take the same phone number with them if they change providers. It is one that they hope to tackle within six months of ICOLs being issued, he said, but it will be a “major process”, including meetings with providers and the right equipment.

There may also need to be a “cooling off” period where providers can’t market to a consumer who has changed providers.

Quality of internet service

Mr Micallef said ways to tackle this include ensuring that terms and conditions of service do not state a provider will provide “up to” x megs of service; they will state the exact speed they will provide and the RA will have in place certain parameters that providers have to give that level of service 80 to 90 percent of the time.

The RA will eventually have the capability to do its own testing to ensure consumers are getting what they pay for.

On the issue of not getting the internet speed you pay for, he said it could simply be that providers are “economising on bandwidth”.

“If you are giving 4 (megs) instead of 6 you are saving money,” he said.

Competition should change that, he said, as consumers will have more choice of providers.

Mast sharing and duct sharing“It is hoped that the RA’s planned spectrum audit will improve efficiencies of spectrum use so that there might be less pressure on new equipment being required on the existing masts,” Mr Stewart said.

The efficient use of spectrum is in everyone’s best interest and will also help to ensure a “level playing field” for everyone.

For a look at work carried by the Malta Authority, see http://www.mca.org.mt and http://www.telecosts.com

Telecoms overseers: D Kent Stewart (left), chairman, and Philip Micallef, chief executive of the new Regulatory Authority. (Photo by Akil Simmons)

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Published February 08, 2013 at 8:00 am (Updated February 07, 2013 at 8:04 pm)

Telecoms regulation chief: Expect lower prices and one-stop shopping

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