My Thoughts on Technology and Jamaica: Digicel to shut down CLARO's Voice Network in HSDPA+ Push - The Louisiana Purchase of Spectrum

Monday, January 30, 2012

Digicel to shut down CLARO's Voice Network in HSDPA+ Push - The Louisiana Purchase of Spectrum


Digicel Group as of March 1 2012AD, will be shutting down CLARO Jamaica’s Voice Network as noted in the article “Digicel to shut down Claro Jamaica” published Friday January 13, 2012 by The Jamaica Gleaner and “Digicel to shut down Claro network”, published Friday, January 13, 2012 By Camilo Thame Business Co-ordinator, The Jamaica Observer.

Digicel Group’s official Press Release entitled “JAMAICA TO BENEFIT FROM DIGICEL ACQUISITION OF CLARO” makes it no less easy to bear, as the benefits of a benevolent monopoly are not worth the loss of competition in the Telecom Industry in Jamaica. Effectively the deal is a Louisiana Purchase of Spectrum for Telecom Provider Digicel, as they have gotten off soft and easy from the OUR (Office of Utilities Regulation).

The FTC (Fair Trading Commission) is seeing the Deal as anti-competitive and not in the Jamaican Telecom Industry and customer’s best interest with the issue now before the Jamaica Supreme Court as stated in the article “Digicel, LIME stake out positions on FTC challengePublished Sunday January 8, 2012, The Jamaica Gleaner.

Kelroy’s Geezam blog article entitled “Claro Jamaica to get the Axe from Digicel come March 1st” made much of the dissolution of the previous agreement hammered out by then Prime Minister Bruce Golding for Digicel Group to continue the buildout of CLARO Jamaica’s GSM Voice and HSDPA (High Speed Downlink Packet Access) Network as noted in the Geezam blog article “CLARO’s Freeness ends 5th January 2012 – Digicel’s Bigger, Better with Data and Cloud”.

This was the conditions set along with the promise of a new Telecoms Regulator specifically tailored to the needs of the Telecoms Industry in Jamaica as noted in my Geezam blog article entitled “New Telecom Act Coming for Jamaica – Providers surprised with their Own Regulator” and my blog article entitled “Telecom Providers get their own Regulator - GOJ says Telecoms For Your Eyes Only”.

Obviously the 517,000 CLARO customers are to become targets of both Telecom Provider Digicel and Telecom Provider LIME in a JA$1.5 billion promotional credit and SIM Card swap bid to acquire them as stated in the article “Fight for Claro customers”, published Sunday, January 15, 2012, The Jamaica Observer and “The value of Claro talkers: J$1.5bPublished Wednesday January 18, 2012, The Jamaica Gleaner.

JA$2000 with a replacement SIM Card from Telecom Provider Digicel may be enough to sway some people to switch to “The Bigger Better Network” but Telecom Provider LIME full-service offerings make the JA$1000 with a replacement SIM Card seem more of an invitation than a outright bribe.

Ironic as both Telecom Provider Digicel and Telecom Provider LIME are separately building out their own Caribbean HSDPA+ Release 7 Networks, thus one would have though this extravagance a bit much for Voice Calling Network as stated in my blog article entitled “LIME's US$80 million Caribbean HSDPA+ Release 7 Upgrade - Sonic the Hedgehog” and  “Digicel's US$85 million HSDPA+ and WiMax 4G Upgrade - Wizards of Waverly Place Fast Five Showdown”.

This when in fact Data, not Voice is slowly becoming the new bread-and-butter of Telecoms as concluded in my Geezam blog article entitled “CLARO’s Freeness ends 5th January 2012 – Digicel’s Bigger, Better with Data and Cloud”.

Putting aside the dishonesty of JLP Leader Andrew Holness in not informing Jamaica of his decision to reverse then Prime Minister Bruce Golding’s decision despite his explanation in the article  Holness defends reversing two-network decision in Digicel/Claro deal”, published Saturday, January 14, 2012, The Jamaica Observer, the fallout of this change makes for rather ghastly reading:

  • Three hundred and fifty (350) CLARO employees made redundant with immediate effect with four (4) weeks severance pay. Some rehired for a short space to complete the transition then laid off later
  • Call rates to Telecom Provider LIME to be reduced by JA$3.50 peak and JA$2.00 off peak from previous rates to JA$14.00 peak and JA$13.00 off peak as per Digicel’s Select Tariffs & Rates
  • Telecom Provider Digicel is to shut down CLARO Voice network by March 1 2012AD but use the spectrum and HSDPA Licenses to rapidly ramp up towards HSDPA+ and eventually LTE (Long Term Evolution) by 2013AD.

Clearly though, the two-Network scenario as proposed by Prime Minister Bruce Golding was proving to be too heavy a set of weights to lift as surmised in my Geezam blog article entitled “Digicel Jamaica’s Alternative Energy Future – Increased Electricity Bills and Energy Sector Opportunities collide”.

With this newly revised deal, Telecom Provider Digicel gets access to CLARO’s Spectrum and 3G Licenses with which they can upgrade to HSDPA+ Release 7 with of up to 42MBps best effort speeds, the next step to achieving LTE (Long Term Evolution) a Telecom Network Protocol capable of 1GBps speeds best effort.

And with the FTC (Fair Trading Commission) challenging the deal, this will be in the news dogging Telecom Provider Digicel all the way to London Olympics 2012AD….
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