A lightly edited address by LIME Jamaica Chairman Chris Dehring to the Rotary Club of Kingston on January 19, 2012.

YESTERDAY, a life-long dream of mine actually came true. I've finally got the chance to quote Mark Twain's famous line.

To anyone who is asking "is LIME really closing down its business?" I simply say "rumours of our demise were greatly exaggerated".

But on a serious note, let me again reiterate that LIME is 100 per cent committed to Jamaica.

We are 100 per cent committed to our employees, our loyal customers, our shareholders, our suppliers, the wider public and everyone who supports us and depends on us.

I'm not just bragging when I say a life without LIME is a life without the technological backbone that supports business, education, communication, entertainment, social interaction — all aspects of Jamaican life.

Can you imagine a life without the ease and convenience of ATM machines?

Can you imagine shopping, eating out or even buying gas without being able to use a credit or debit card to make payments?

Can you imagine having your friends and relatives overseas and not being able to e-mail, skype, tweet, update your Facebook, or even just get a good old-fashioned phone call?

Can you imagine doing business without being able to make a wire transfer? Or without the myriad voice and data systems that enable you to carry out transactions with suppliers in China as easy as if it was a store down the road?

When you think of GPS tracking, vehicle surveillance, automated security systems, networks that support the Government, UWI, UTech and various local and multinational businesses, we built the technological backbone that brought all of these services to Jamaica. And we continue to support the services that make your life easier.

It's hard to imagine Jamaica without LIME. But there is no doubt that we're now facing pressure. And this brings me to the topic that's on everybody's minds right now.

Background

In every bar and at every cocktail party people are talking about the Digicel/Claro merger and all its implications.

This issue has everybody talking, texting and tweeting.

I think it's absorbed so much public attention because everyone likes to see when the big boys fight.

But believe me, there is much more to this than two companies battling for turf. This merger — and all the attendant issues — has implications for the future viability of Jamaica's telecommunications industry.

And all of us here are telecoms customers — whether through our businesses or in our private lives. So, whether we realise it or not, each of us has a stake in this matter.

You may say that my stake is bigger than yours because of where I work, but believe me, this issue is bigger than me and it's bigger than LIME or any of our competitors.

This is about us as Jamaican people and what we pay to access services that are critical for work, play, education, entertainment and life in general.

So while there's a lot of debate on the matter, I think it's important to lay out some plain facts so we can have an informed discussion.

The Digicel/Claro merger has serious implications for the future of Jamaica's telecoms industry. While the public debate on the matter continues, I wanted to touch base with you and share our company's position on these issues.

Who Are We?

Now, I can't blame you if you think that as chairman of LIME I'll be giving you a biased view of the situation. But I think you have to understand that the Cable & Wireless of old has been laid to rest and LIME is coming from a very different position.

If you're tempted to ask, what is the difference between Cable & Wireless and LIME, I'd say look at me. Or look at our managing director, a gentleman that a lot of you know, Garry Sinclair.

We are Jamaican-born and bred. We know this country, we know our people and we have a vested interest in securing our collective future.

If you want to know more about LIME, I can tell you about the 5,000 Jamaicans who are dependent on our business, who either work or do business with our company.

I can tell you about our 25,000 Jamaican shareholders, several of whom come to every AGM and rough up me and the rest of the board about their dividends.

I can tell you about the $300 million we've invested in sports and community development over the last three years.

Or I can tell you about the $8 billion we have invested in infrastructure to upgrade our mobile, broadband and fixed line networks.

I can tell you about the partnership that was forged last year between our management and our trade unions when we put aside our differences and signed an historic agreement to secure the future of our business.

I can tell you about our nearly two-decade sponsorship of West Indies Cricket in the days when our team was the best of the best.

I can tell you about the free Internet that we give to over 300 schools, the free Internet that we've been giving from the days of dial up.

If you want to know about LIME I can tell you about a company with a Jamaican leadership team, a Jamaican staff and — call me sappy or sentimental — a Jamaican heart.

LIME is fresh, modern and vibrant. LIME is also tough, gritty and up for a challenge. And we're ready to compete, but we're insisting that the game is played on a level playing field.

We have no issues with mergers and acquisitions per se — that's a regular part of business.

Our issue with the Digicel/Claro merger is that it is being done in the context of an outdated and irrelevant telecoms legislation and regulatory environment — a fact that successive Governments and regulators acknowledge time and time again, but somehow, this is allowed to remain.

Historical Perspective

To understand why I would make such an explosive statement you have to understand how our industry is set up.

Without going into too much history, the existing telecoms regulatory framework was originally meant to be temporary to facilitate competition when the market was liberalised.

These regulations place a lot of emphasis on regulating our company so our position as the incumbent would not give us an unfair advantage over new entrants.

Well, it's been 10 years and they haven't changed one single letter of the law.

In that time, Digicel, one of these new entrants, has now become the dominant player with more than 80 per cent of the market, and although the landscape has changed dramatically, LIME continues to be heavily regulated while Digicel operates unfettered, exploiting its dominance to the detriment of consumers and competition.

What does it all Mean?

I know sometimes the terms we use in telecoms can get technical when we talk about "mobile termination rates" and "cross-network rates" or when we talk about "dominance" or, in this case, abuse of dominance.

But I don't want to get caught up in all the jargon.

The real issue here is that the way our telecommunications industry is being regulated is literally taking us right back to monopoly.

Now, I know some people, particularly my competitors, will want to take me on and talk about the days when LIME was the only provider. But even in those days LIME was heavily regulated.

Digicel, on the other hand, has the largest market share and is able to set its price.

Now, my competitors have tried to argue that they are regulated, but this is simply not the case. Let me tell you the facts: in 2004 the OUR made a declaration of dominance in the mobile market. Digicel fought that determination for six years.

Finally, in 2010, the OUR's determination was upheld but so far no regulatory action has been taken. And in all the years they were fighting this determination, the mobile market remained unregulated.

So Digicel saying the determination was upheld so now they are regulated is disingenuous. That's like a man giving a woman an engagement ring and saying "we're now married". Engagement just means you have the intention of getting married. You're not married until your wedding ceremony is performed.

At this point, when it comes to regulating Digicel, trust me, there has been talk about the possibility of getting married, but nobody has even put an engagement ring on — let alone said "I do".

This lack of regulation is what has led to our current situation where Digicel is able to charge exorbitant rates for its customers to call LIME numbers. This is what we refer to as "cross-network rates" it's what you pay to call me on my LIME phone.

Up to recently, if you're a Digicel customer you were paying as much as $17.70 per minute during peak time and $15.80 per minute in off-peak time.

This means, although I'm standing right here beside you, it was cheaper for you to call someone in the depths of the Far East, than it was to call me, right here in Jamaica, because I'm a LIME customer.

At the same time, if you're a Digicel customer, it will cost you about $10 per minute to call another Digicel customer in peak time and $8 in off-peak time.

So you literally get punished for calling LIME.

Because of Digicel's overwhelming market share, this had led to a situation where the majority of mobile customers in Jamaica will not call LIME because the price is just too high.

Most persons think the rates are high because LIME has set them high, but those rates are set by Digicel.

The result is that they have "ring fenced" their network and they are able to keep most of the calls being made in Jamaica on their network.

In any other country where you have a dominant provider — and by dominant we mean when you have such a large share of the market that you can pretty much do as you please — the regulator would step in to ensure that abuse of dominance does not take place. In Mexico just recently, Claro was fined US$1 billion by the regulators for pretty much doing the same thing that Digicel is being allowed to do here.

In Jamaica's case, the regulations actually facilitate Digicel's anti-competitive behaviour and the industry and consumers suffer as a result.

The impact on the industry is that it is just not viable for other companies to offer a voice service.

We actually saw that the richest man in the world, who owns America Movil, Claro's parent company, one of the largest mobile operators on the planet — with almost 200 million customers — he came to Jamaica and couldn't make a dent in the market.

We talk very easily about another third player coming into the market but the fact is, no one goes into business to lose money. And with our current regulations no one is going to invest here.

The Current State of Play

Ironically, it's Claro's departure that now has everyone talking about how we are governing our telecoms industry. But LIME has been advocating change for several years.

But now — because we've seen a major player leaving the market, and we see one provider with enough power to distort the market — we're ready to talk about real change.

The previous Government appeared to have an appreciation for the serious implications of the current situation. This was evident in August of last year when the then Prime Minister Bruce Golding approved the Digicel/Claro merger, on the condition that Digicel continued to maintain both its current network and the Claro network.

You may recall that at that time Mr Golding said that one of the issues Digicel needed to address was the high charges it sets for its customers to call other networks.

He told the Parliament that Digicel had actually offered to adjust that rate by $3 and $2 respectively, but he rejected their offer point blank. In fact, I believe he described it as "unimpressive".

In light of the lack of competition exacerbated by Digicel's refusal to offer a meaningful rate cut, Mr Golding gave a commitment to bring emergency legislation to Parliament, which would overhaul the regulatory framework of the telecoms industry.

He said the legislation would be before the House in six weeks.

Well, it's been five months and the said legislation is yet to be passed and the condition that Digicel maintain both networks has been rescinded.

This is why we have sought a judicial review of the then prime minister's decision to grant approval for this transaction.

Now, our competitors have argued that the merger is good for Jamaica and LIME is just being bad-minded. But we are not the only ones who have expressed grave concern about this situation.

Recently, we saw where the Fair Trading Commission, our competition watchdog, has seen it fit to file a lawsuit to prevent the deal from being finalised.

The FTC has argued that the merger of Digicel and Claro will lessen competition, stifle telecoms innovation and leave Jamaican consumers worse off.

Now, if the FTC feels it is their duty under their mandate to prevent the deal, then I think this speaks volumes about its potential threat to consumers.

The fact of the matter is that, apart from Digicel, no one is really buying the argument that less competition is good for us.

When LIME spoke up, we were actually berated by Digicel for voicing our strong disagreement with "public officials".

Now, I don't know what happens in Ireland, but this is Jamaica, and as Jamaicans we reserve the right to speak up when we respectfully disagree with decisions by our public officials — who, by the way, we vote for and put in and remove from office. I believe that's called a democracy.

LIME is a publicly listed Jamaican company, managed by Jamaicans, in which thousands of a wide cross section of Jamaicans own shares and we reserve our right to respectfully disagree with any decision taken by our Government if we believe it is not in the best interest of our country. Our country. We consider it more than a right. It is our duty.

And you know us Jamaicans, We want justice!

But fun and jokes aside, this issue is no laughing matter.

The Need of the Hour

We are pushing, strenuously, for the newly elected Government to implement the proposed legislation immediately.

We strongly believe that the granting of this merger, without the necessary regulatory changes, will stifle competition and prevent consumers from reaping the true benefits of liberalisation.

We are very encouraged by the soundings from Minister Paulwell, who has an undeniable record of achievement, a man who wrote the book on fostering competition in the telecoms industry. We expect he will continue the work of the previous administration led by former PM Andrew Holness who showed their intent by tabling the emergency legislation at the last sitting of Parliament before the election.

What Do We Think is Best?

When you hear us telecoms people talking and you hear all the jargon, it's easy to get confused, but the issue is simple ... the time has come for every Jamaican to pay the same rate to call any network.

It's time for Digicel to stop punishing its customers for calling LIME. It's time for people to own their telephone numbers so that they can take that number with them to any service provider and get services.

It's time for a level playing field so telecoms companies can compete on factors like price, service, innovation and let the customer decide.

LIME has been fighting for this for several years and we will not relent until we get meaningful changes that will restore competitiveness in the industry and bring real value and benefits for Jamaican consumers.

This issue is important to every single one of us, because we are all Jamaican consumers and we all depend on the telecoms industry in one way or another.

Back in the days, when we only had one provider, I'm sure some of you here were part of the movement to have the industry liberalised so we as Jamaicans could have the full benefits of a competitive market like citizens in most developed countries.

Now, 11 years later, that liberalisation is under serious threat and it is us, as consumers, who will be worse off.

The need of the hour is for an overhaul of our telecoms regulations.

One rate for every customer to call any network.

Ladies and gentlemen... time come.

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