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Digicel marks one year in VI PDF Print E-mail
Written by Webmaster   
Wednesday, 25 November 2009
Last November, no one could predict how the entrance of a third mobile carrier into the territory would affect the telecommunications market. This November, all three companies have a lot to be thankful for. Nearly one year after Digicel rolled out service in the Virgin Islands, the Jamaica-based company says it has captured 30 percent market share, is ahead of budget, and is poised to grow to 50 percent market share within the next 12 months.

But the entrance of a third rival carrier hasn’t spelled doom and gloom for the incumbents. LIME and CCT Global Communications have revamped their infrastructure with multimillion-dollar investments toward their networks; developed innovative products and services; and continued to grow their subscriber bases.

 “I have to say [about] Digicel’s launch over the last 12 months, we have taken the market by storm,” said Digicel BVI CEO Alan Bates, speaking in an interview on Tuesday.

Since the company’s founding in 2001, the carrier has made inroads regionwide, boasting of competitive customer service, network coverage and reliability, and often entering in newly liberalised markets.

“With a market that already has two existing operators, … we need to excel in all areas,” said Mr. Bates. “We need to be better than the competition — better choice, better innovation — and we need to work harder than the other networks to win customers.”

Over the last year, Digicel spent an estimated $20 million to develop its network in the VI, erecting 32 cell sites. The company launched a 3G network in Bermuda, and will soon roll out a 4G network in Jamaica. Mr. Bates said that the company also is looking at ways to further invest and further expand its product offerings here.

Digicel says it has seen success in the territory, sparked by innovative marketing campaigns and promotions. Like LIME, the carrier is able to draw on its pan-Caribbean network to offer competitive regional unlimited calling plans, and recently began offering 17-cents-per-minute calls between networks in the territory.

The discounted rates are a first here, said Mr. Bates, who claimed customers save upwards of 15 percent.

The company also has worked to capitalise on tourism and the financial services sector.

Mr. Bates said a series of meetings prior to Digicel’s launch were key to understanding the needs of the business community here. According to the CEO, many companies complained of the difficult economic climate and high cost of telecommunications; others worried that they were getting poor customer service.

The companies “needed to re-evaluate their cost base,” Mr. Bates said. “We were able to come up with new innovative packages that brought down telecommunications costs, on average, between 20 to 30 percent.”


Varied services

The company said it has been successful with both mobile and fixed-line services. Last week, Digicel announced a partnership with Cisco, to provide, sell, deliver and support private branch exchange (PBX) solutions in the territory.  

To the CEO, Digicel’s success here is rooted in a dedicated support staff, a strong first point of contact, and innovative products and services.

“What actually happened was that the customers stopped, re-evaluated their position, said, ‘are my operators offering me this? No they are not,’ and they came to Digicel and asked for service,” Mr. Bates said.

In the coming year, Digicel will look to further expand its offerings in the territory. “From when we broke our first piece of soil, to building the network, we did it in nine months. Where it has taken the other carriers years, we have matched the networks they have,” he said.

Across the island, at the LIME headquarters in Palestina Estate, the company’s Country Manager Joel Abdinoor said despite Digicel, sales remained strong in the territory.

“Our view is that we have maintained market leadership,” said Mr. Abdinoor, speaking in an interview last week. While the company would not reveal specific figures, the country manager said its subscriber base — estimated at around the VI’s population — had increased over the last year.

To Mr. Abdinoor, the company proved itself in 2007. “LIME had the opportunity to go after an incumbent with CCT,” he said. “It proved we were capable of gaining a large percentage of the market share within three months.”

As a new entrant into the market, the company had to provide competitive services and offer good-value proposals, according to the country manger. LIME recently introduced an unlimited plan for fixed and mobile users in the Caribbean, and launched home roaming rates, which allow consumers to pay VI rates while traveling throughout the region.

“We have leveraged the fact that we have a pan-Caribbean presence,” Mr. Abdinoor said.

Key to LIME’s new strategy is its transformation from 13 separate entities to a centralised regional presence, dubbed One Caribbean. The restructuring means the company has a support structure of 3,000 workers, with over 100 employees in the VI.

“We’ve moved from a $50 million company to a billion dollar powerhouse … with seamless business across the Caribbean,” Mr. Abdinoor said.

Over the last year, the company has invested sizably in its infrastructure in the territory. According to the country manager, LIME’s VI branch reinvested about 10 percent of its revenue, between $4 and $5 million, into the network.

The company also is focused on wireless data and evolving new technologies, and moving towards a 3G network throughout the region. Locally, LIME is the only company in the territory to offer MPLS, a managed data product for corporate clients.

LIME also is hoping to capitalise on various green initiatives. According to Mr. Abdinoor, the company has unveiled paperless billing, and is looking at ways to recycle old yellow pages and phones.  

Despite its smaller size, CCT has doggedly remained in the telecommunications game, reinventing its products and services to stay competitive in what has become a market crowded by two pan-Caribbean giants.

In the last year, the company has boosted its network coverage and increased products and services offered, said CCT General Manager Jose Luis Fernandez, speaking from his Road Town office on Monday.

“When Digicel entered in 2008, we were waiting for that moment; we were ready,” Mr. Fernandez said.

While the general manager did not reveal estimates of the company’s market share, he said the company has grown its customer base since last year by offering a variety of unlimited plans for the first time in the VI.

“We innovated the market and we changed the rule of the telecommunications market in the BVI when we launched these unlimited plans,” he said. “Since, the other two carriers have been trying to follow us, but they have not replicated us.”

CCT says its monthly unlimited plan — with no contract, no bills and no deposit — stands out from the other carriers. The company also claims it offers a wider variety and depth of services, including data and wireless, to differentiate itself in the market.

Corporate clients, for instance, can tailor wireless packages to specify upload and download bandwidth. “When you take into account the full range of products and services, the other two cell phone companies are very far from us,” Mr. Fernandez said.

Like the larger companies, CCT went to work on its networks last year. “Everyone knows that the network used to have certain holes,” commented Mr. Fernandez, who said that CCT increased the number of cell sites by 70 percent, adding coverage and quality.

“The perception of the quality of the network is not easy to change, from today to tomorrow,” he said. “But if you talk to anyone in the street, you will notice that everyone says our coverage is similar or better than the other competitors.”

To compete against the larger companies that have “deep pockets and very efficient operations,” the general manager said CCT has had to “reinvent itself every day.” However, a smaller operation is advantageous to make quick decisions, said Mr. Fernandez.  

Like LIME, CCT is no longer the same company it used to be one year ago. “We have transformed … from the point of view of network quality and coverage, and from the point of view of innovative products and services on the market,” Mr. Fernandez said.

One year after Digicel entered the market, local consumers are thankful to have more choice and better prices. And, with all three telecommunications carriers seated at the table, everyone’s got a piece of the pie.

 
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