LIME calls for an end to asymmetric termination rates

13 Feb 2012

The managing director of LIME Jamaica, Garfield Sinclair, has criticised the regulatory environment in the country, and is requesting equal treatment amongst players. Sinclair’s criticism focused on the employment of asymmetric termination fees, claiming that the odds are stacked in favour of Digicel, which completed its acquisition of the country’s third wireless operator, Claro late last year. According to Sinclair, whilst Digicel pays LIME only USD0.01 to terminate a call on its networks, the same service costs LIME USD0.07; last year LIME paid JMD1.48 billion (USD16.82 million) in interconnection fees, but collected only JMD80 million. The high cost of interconnection has kept the price of cross-network calls high, a situation favouring the dominant player, Sinclair said.

Sinclair called into question the continuation of LIME’s operation in the Jamaican market, saying that ‘shareholders should not be asked to pump money into a sinkhole.’ Responding to criticism that the former monopoly has simply struggled to compete against a telco delivering better services, Sinclair added: ‘It was not about market savvy. You can’t say that about Carlos Slim, the richest or second-richest man in the world, yet he could not survive [Carlos Slim is the owner of America Movil, which operated in Jamaica under the Claro brand until last year]. It says something about the dominant player ring-fencing the competition.’

Jamaica, Digicel (Jamaica), LIME Jamaica