700MHz spectrum up for grabs; MTRs may fall to JMD2

27 Mar 2013

Telecoms minister Philip Paulwell has announced plans to auction 700MHz frequencies for wireless internet services before the end of July, the Jamaica Observer reports. Two 15-year concessions are to be put on sale, with successful bidders required to roll out networks covering 90% of the country within five years. The government is keen to attract new players to the market but with only two licences available, incumbent cellcos LIME Jamaica and Digicel Jamaica are likely to walk away with the airwaves. Pre-auction activities are to begin in early April, with the issuance of an Information Memorandum and a Request for Proposal. The entire process is expected to be concluded by 15 July 2013. Paulwell stressed the importance of the rollout targets, threatening to withdraw the licence if the timeframe is not adhered to.

In related news, LIME CEO Garfield Sinclair was quoted as saying that he expects mobile termination rates (MTRs) to fall below JMD2 (USD0.02) per minute in the near future. The lower rate would follow the conclusion of the regulator’s study regarding the Long Run Incremental Cost (LRIC) model. As noted by TeleGeography’s GlobalComms Database, the Office of Utilities Regulation (OUR) set an interim MTR of JMD5 per minute in mid-2012 shortly after reforms to telecoms legislation boosted the watchdog’s authority, as a short-term measure to limit the potential for abuse of market dominance by Digicel.