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Digicel Press ReleaseDigicel Press ReleaseDigicel’s Press ReleaseDigicel Press ReleaseFor decades, Fiji was deemed too far and too small to be a viable telecommunications market.  All that changed last week with the announcement of Digicel’s entry into the mobile market in Fiji.  For a country that suffered through a bloody colonization process and instability in the short years of independence, this signals momentous change.  The high prices and poor service that have historically shackled communications in Fiji will hopefully become a thing of the past.   If we can use Digicel’s track record in other countries as an indicator, they just might be.

Fiji takes a tremendous leap toward competition and economic liberalization with the granting of a operator’s license to Digicel, a Caribbean-based operator with presence in 20+ countries with similar profile to Fiji.

Contrary to prior reports, the government auction process did not hand out two licenses for mobile operators. Digicel pays the government US$10.25 million for the right to be the only mobile operator to go up against Vodafone.

Fijilive says that Digicel has already put in place pieces of an estimated FJ$120 million cellular communications network. According to their own press release, the company also intends to make Fiji the headquarters of its regional operations, eventually employing as many as 250 full-time and an equal number of part-time employees.  You can find the press release attached to this post (Thanks to D).

With much of its infrastructure already in place, the company plans to roll out services in 2009.  Consumers can expect prices to drop sharply and competition for services to increase as Digicel puts on the pressure to become the operator of choice for all of Fiji.  Enough cannot be said about Digicel’s track record in other countries in the South Pacific.

The high cost of cell phone usage under the Vodafone monopoly will soon be a part of Fiji’s past. Vodafone and ATH’s large profits have come at the expense of high prices, zero competition, and stifled economic growth.  For modern economies, communication is by far the most important business tool. With lowered costs for communication in Fiji, the hope is that technology will become accessible to those who may have not been able to afford it before.  Costs to businesses should decrease, increasing overall productivity.

The liberalization in the telecommunications sector bring a wide range of benefit.  Where Vodafone was slow to release anything but the most basic services and features, competition from Digicel will bring to users in Fiji services that they have not seen thus far.  Expect new services in mobile internet, video streaming, and other high-end data services as Vodafone can no longer take your recharge card dollars for granted.

It was not long ago that few strands of cable were what connected Fiji to the outside world.  Satellite communications and fiber-optic cables have brought Fiji a long way since those early days (which were not too long ago).  

There are some serious questions that remain about this move toward economic liberalization and competition. 

How much of the US$10.25 million will go toward the establisment of universal accesss schemes for mobile and internet?  If you have read earlier posts on this site, then you know that universal access is something that is very important to the authors of this site.  We urge Mr. Ricketts to come forward and outline how service will be expanded to rural areas.  Widening access to technology should be a key benchmark by which this current round of liberalization should be measured. 

Additionally, what are the details and specifics of the Telecommunications Authority of Fiji, the new regulatory body being set up to oversee the industry?  More to come, so the only thing we can all do is stay tuned as the developments come in.

Deregulation moves forward with announcement of an auction to determine which companies will receive a license to compete in Fiji’s mobile market.  Vodafone has enjoyed monopoly status for 13 years, under the previously negotiated deal which gave monopoly status to ATH companies.

From FijiLive:

It is understood companies that have been shortlisted can enter the auction and details on this are being finalized by the Commerce ministry.

Read the article here.

It’s really funny.  A country that has been held back from competition for so long is pretty much in the same position as the United States.  The auctioning of mobile licenses is going on as the same time that the US Govt. is undergoing the same process to auction a portion of the broadcast spectrum being vacated by television stations.  Here’s an excerpt of an article from the San Francisco Chronicle:

The minimum bid is $4.6 billion for the C block of 700 megahertz wireless spectrum, which is being freed up as part of the federally mandated shift from analog to digital television by 2009.

Of course, things move at a different pace in Fiji. The Govt. of Fiji should also put several stipulations into the licenses.  Requiring the bidders to pay into a pool annually, which the govt. can use to develop a Wi-max network covering the country especially rural areas out of mobile coverage.  These networks have been unveiled in many parts of the western United States and have all sorts of added-benefits like helping law enforcement communicate in these remote areas.