Digicel sues C&W for GBP300 million

20 Jul 2007

Digicel, the Caribbean mobile group run by Irish billionaire Denis O’Brien, is suing Cable & Wireless (C&W) for over GBP300 million (USD615 million), claiming that its entry was impeded in seven telecoms markets in which the UK-owned operator is the incumbent telco. Digicel’s case centres on difficulties it claims it experienced gaining interconnection with C&W’s networks. Digicel launched in Jamaica in 2001 and has almost five million customers across 22 markets in the Caribbean, Central and South America and Samoa.

Digicel said in a statement: ‘Without exception, in each territory, Digicel experienced resistance and obstruction from C&W. Indeed, in 2002 an internal strategy document produced by C&W revealed that C&W was intentionally delaying Digicel’s entry into these markets for as long as possible…In St Lucia the launch by Digicel was delayed from before Christmas in 2002 until late March 2003…in Grenada it was delayed by five months; in Barbados by over six months; in Cayman by over two months; in Trinidad & Tobago by at least four months and in Turks & Caicos the launch was delayed by over three months…Aside from lost market share and future profits, Digicel lost revenue from call charges and interconnection fees payable by C&W in respect of inter-network calls originating on C&W’s networks, costs and expenses arising from the unlawfully protracted process of interconnection in each territory, costs and expenses arising from the delayed launches, and lost management and staff time dealing with C&W’s unlawful behaviour.’ Digicel non-executive director Sir Julian Horn-Smith added his opinion yesterday, saying: ‘This action has only been entered into after serious consideration by the board of Digicel. The consistent prevarication and obstruction that Cable & Wireless has undertaken providing interconnection in these seven territories is something that I have never witnessed before. A successful outcome for this case will ensure a much more fair and competitive environment for mobile in the Caribbean.’ In a statement, fixed line and mobile provider C&W confirmed it had received the claim, and added: ‘We believe the claim is without foundation and it will be vigorously defended…C&W is gaining market share in the Caribbean where we are market leader in ten out of 14 of our markets…We believe that the claim is no more than a deliberate spoiling tactic by Digicel.’