The impact of the liberalisation of the telecommunications sector on the Jamaican economy, culture and communications.
We must be cognizant of the fact that for the Jamaican economy to grow or and any country of that nature their must first be a positive impact on investments and revenues.
Hence the following:
Impact on Investment
Despite the fact that over the years the technological barriers to
entry in the telecommunications sector have been eroded, the creation of a
modern tele-communications sector still requires a huge outlay of capital.
Liberalization of the sector along with the implementation of an appropriate
regulatory framework is expected to attract the private investment required to
finance the build-out and upgrade of telecommunications networks. The
post-liberalization level of investment in a telecommunications sector is
therefore a good indicator of whether liberalization will indeed result in an
increase in the variety and improvement in the quality of service offerings by
operators and the capability of operators to deploy new services in the
long-run.
The available data indicates that the level of investment in the
telecommunications sector has remained buoyant. Table 2.1 below shows the level
of investment in the mobile segment of the sector during the period 2001-2005.
The figures show that investment in that segment increased between 2001 and
2003 and after suffering a decline in 2004, it began to increase again in 2005.
It is safe to assume that in the
first three years of liberalization, investment in the mobile segment was the
key driver of telecommunications investment. During this period, the entrants
in this segment Mossel Ltd. (T/a Digicel), and Oceanic Digital Jamaica (T/a
MiPhone) as well as the incumbent, Cable and Wireless Jamaica (CWJ), deployed
and/or upgraded their mobile networks. Since liberalization, CWJ has also
carried out an extensive upgrade of its fixed network in order to facilitate
the deployment of ADSL. The company has announced further upgrades aimed at
improving its broadband and VoIP services. The building of the Fibralink
submarine cable and the deployment of Columbus Communications Limited’s network
have also contributed to the level of investment in the sector over the past
two years.
Table 2.1: Capital Expenditure in the
Mobile Segment 2001-2005
Year
|
Investment
(US$ M)
|
2001
|
202.3
|
2002
|
254.7
|
2003
|
309.2
|
2004
|
161.7
|
2005
|
172.8
|
Source of Data: OUR
Impact on Revenues
The country’s
competitiveness in the international economy will be dependent on the
deployment of innovative communications solutions, which in turn will be
dependent on continuous network modernization/development in the sector. It is
therefore essential to determine the impact which the liberalization process
has had on revenues in the sector as this will affect operators’ ability to
modernize and expand their networks. Data on the sector revealed that revenues
for the two largest operators in 2005 were 65% higher than they were in 2001
(see Figure 2.2 below).
Impact on Economic Growth
Over the years analysts have linked improvements in a nation’s economic position to the liberalization of its telecommunications sector. Telecommunications networks play an important role in the integration of the supply chain between the producer of goods and services and the individual retail customer. As economic activities become increasingly global and information intensive, the economic importance of telecommunications infrastructure has increased significantly. In fact, access to telecommunications services has become a necessary condition for participation in domestic and international markets. Therefore, greater efficiency in the telecommunications sector should in turn increase growth and output in other sectors. The reduction in prices and the wider availability and variety of telecommunications services will decrease input prices and spur innovation in other industries, thus resulting in productivity gains. The increased efficiency of the telecommunications sector is especially important to the service-based industries as they are the most intensive users of telecommunications services.
Over the years analysts have linked improvements in a nation’s economic position to the liberalization of its telecommunications sector. Telecommunications networks play an important role in the integration of the supply chain between the producer of goods and services and the individual retail customer. As economic activities become increasingly global and information intensive, the economic importance of telecommunications infrastructure has increased significantly. In fact, access to telecommunications services has become a necessary condition for participation in domestic and international markets. Therefore, greater efficiency in the telecommunications sector should in turn increase growth and output in other sectors. The reduction in prices and the wider availability and variety of telecommunications services will decrease input prices and spur innovation in other industries, thus resulting in productivity gains. The increased efficiency of the telecommunications sector is especially important to the service-based industries as they are the most intensive users of telecommunications services.
The impact of telecommunications liberalization on
Jamaica’s economic growth was examined by using Gross Domestic Product (GDP) at
current prices as a proxy. As can be seen in Figure 2.3 below, the sector’s
contribution to GDP has increased steadily since liberalization moving from
J$14275.7M in 1999 to J$28511.3M in 2004.
Prepared
by the Fair Trading C ommission Jamaica - All Rights Reserved
Culture
Currently, the Jamaican culture can be described by our unique music (various modern and traditional music), our folklore, customs, language/dialect, cuisine, religion, various kinds of art and, ostensibly, our behaviour/conduct.
The culture manifested in urban Jamaica is certainly different from that depicted in rural Jamaica. However we have seen a remarkable growth in exhibition of the Jamaican culture locally and internationally as a result of increased telecommunication. With this happening Individuals in the the Jamaican diaspora are able feel at home even though they are away.With all this mix, telecommunication has made our culture more widespread and accessible.
Garth A. Rattray is a medical doctor with a family practice.
Communication
One of the more remarkable developments
in Jamaica's communication History since independence has been the phenomenal
growth of voice telephony. In just over a decade, the country moved from the
grips of a limited and inefficient monopoly operated by Cable and Wireless, into
what has become a mobile phone revolution. In 1992, the monopoly wired network provided
a service to only 278,872 wire –line telephone subscribers. With the advent of
competition, starting in the year 2000 with the arrival of Digicel and
Centennial, the wireless networks has mushroomed, evidenced by over 3 million mobile
handsets in use in both rural and urban Jamaica in 2012.
The three current competing
telecommunications providers, Digicel, Flow and Lime (Cable and Wireless) now
enable local and global communications, including via the Internet, to friends
and relatives and business associates at home and abroad. The movement has been
from clunky rotary phone dialing, long queues at public call boxes and longer waiting
lists for home phones, to what some regard as the unimaginable: more phones
than people, strong growth in the acquisition and use of smart phones, phone –
based cameras that have made Kodak and photographic film obsolete, increasing
presence of portable tablets that scroll at the touch of a screen, e-readers that
open up new vistas for reading books, blogs and websites, and computers that enable
data archiving, social networking, mobile banking and electronic commerce.
Professor Hopeton S.Dunn
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