Peter Espeut
IN RESPONSE to my column last week 'Nicodemus Rate Increase', Cable & Wireless has come out fighting - without addressing the main issue: that their announced single rate for all domestic calls is a Nicodemus rate increase.
In a Letter to the Editor of this newspaper last Saturday, Errol K. Miller, vice-president for corporate communications at Cable & Wireless (C&W) Jamaica Ltd., suggests that I might be 'mischief-making' when I reminded the public that C&W obtained an exclusive license from the government allowing them to make 17.5 per cent profit on their capital base. His strong point is the advice that "the regime under which Cable & Wireless was permitted a rate of return of between 17.5 to 20 per cent ended with the relinquishing of our exclusive licences in 1999/2000".
PROTECTIONIST ARRANGEMENT
Well I am so happy to hear that! Such an arrangement is protectionist and is against the free market principles so stoutly defended by the G8 countries - including the United Kingdom where C&W is based. I remember when C&W was forced to give up its monopoly, but I openly admit that I missed the celebration that must have accompanied the termination of this guaranteed rate of profit. I apologise to C&W for any embarrassment they may have suffered to still be thought to be making this particular guaranteed rate of profit.
But I am not so foolish as to believe that C&W gave up this dolly-house arrangement without replacing it with something else just as appealing and just as supportive of their bottom-line. The public is not being kept informed on these matters, and I look forward to some adept investigative journalist (a superior creature to us mere columnists) revealing to the public exactly what the new arrangements are. What we really need now is some corporate communication.
What is really mischievous is the use by Mr. Miller of the old propaganda tactic, where if you don't like the message, you attack the messenger; or if you cannot defend the indefensible, you try to discredit the whole message by criticising some part of it. The real point of my column was not any guaranteed rate of profit, but the Nicodemus rate increase which has accompanied the announced single rate for all domestic calls, and this subject was studiously avoided by Mr. Miller. The public is entitled to know whether this single rate for all domestic calls is going to increase the bottom line of C&W or not. Since my column last week I have been on two talk shows discussing this issue, and in both cases C&W declined to join the discussion. What we really need now is some corporate communication.
PUBLIC GOOD
This is not the first time that C&W has announced a 'gift horse' to the public - a strategy to increase their corporate bottom line masquerading as a public good. My readers will remember the free use of a messaging service attached to everyone's land-lines some years ago. After a certain number of rings, or if the number was busy, the caller was invited by C&W to leave a message after the beep. Previously, the line would give a busy signal, and there would be no charge to the caller, and no revenue to the company; but now with this "free service", the call would be automatically answered by C&W and the invitation to leave a message given. What this did was to abolish busy signals, and so C&W earned toll charges on every call made, which substantially increased the company's bottom line.
DOMESTIC CALL RATES INCREASE
This time, C&W has announced the abolition of long-distance charges, which is a good thing; I called for exactly this in a column some years ago; and what I intended was that the local rate should be charged for a call anywhere across our small island, too small to justify long-distance charges. But what has happened is that the single rate for all domestic calls is higher than the previous local rate, and since most land-line calls made in Jamaica are local calls again, this measure will function as a rate increase, and will increase the bottom line of the company. It seems that corporate communication does not stretch to informing the public of these matters.
What I really want to know is, where is the Office of Utilities Regulation (OUR) in all this? If this policy shift (and the gift of the messaging system) results in increased telephone charges, doesn't the OUR have a duty to treat it as an application for a rate increase? And if the OUR decides to approve the application, do they not have a duty to advise the public of the financial consequences to the consumers of their decision? It seems to me that either the financial analysis of the OUR is lacking, or that they are entirely too friendly with the companies they are empowered to regulate.
Peter Espeut is a sociologist and is executive director of an environment and development NGO.
