My Thoughts on Technology and Jamaica: Symbiote Investments Limited gets DMSL License for Caricel as 5G coming in 2020

Tuesday, October 4, 2016

Symbiote Investments Limited gets DMSL License for Caricel as 5G coming in 2020

“The main work for my Cabinet was to determine whether the conditions set by the former Cabinet were met, but we did more than that.  We carefully considered the matter and took into account the legal advice of the Attorney General”

Prime Minister Andrew Holness commenting on the decision to grant Symbiote Investments Limited a DMSL (Domestic Mobile Spectrum Licence) on Tuesday September 13 2016

Caricel lives, leaving Digicel very afraid.

This as Prime Minister Andrew Holness decided to grant Symbiote Investments Limited a DMSL (Domestic Mobile Spectrum Licence) as reported in the article “Gov’t to Proceed with Issuing of Telecoms Licence to Symbiote Investments”, published September 14, 2016 by Denise Dennis, The Jamaica Information Service.

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On Tuesday September 13th 2016, Prime Minister, the Most Hon. Andrew Holness made his decision known during a sitting of the House of Representatives. He also state that the current carrier and service provider licences held by Symbiote Investments Limited, which uses the brand name Caricel, will not be revoked.

This despite a report by the OCG (Office of the Contractor General) recommending that the DMSL be revoked and should not be issued based on investigation into the company. Prime Minister Andrew Holness decision was therefore made on the legal counsel provided by the three (3) regulators related, somewhat vaguely, to the Telecoms Industry:

1.      OUR (Office of Utilities Regulation)
2.      SMA (Spectrum Management Authority)
3.      JCF (Jamaica Constabulary Force)
4.      Symbiote

However, the DMSL, which is granted for fifteen (15) years, comes with certain provisions:

1.      Confirmation from the Financial Investigation Division of the Jamaica Constabulary Force (JCF) that there were no adverse findings from the due diligence exercise
2.      No sale of the licence
3.      No change of control or owner (directly or indirectly) without the approval of the Government of Jamaica

But strangely, Symbiote Investments Limited had already been granted a Telecom License as officially announced on Monday May 16th 2016 to begin operations in Jamaica as I'd reported in my blog article entitled “How JA$6.2 billion Symbiote Investments Limited Spectrum may be Chinese-Jamaican Telecom Provider”. 

So what was causing the delay?

Symbiote Investments Limited and the DMSL - Financial troubles drew OCG's eye

Turns out there were some issues as it relates to paying the requisite fee of US$21 million ($2.65 billion) to acquire the DMSL. Symbiote Investments Limited had not paid the amount in full.

Instead, they paid only paid US$4 million upfront with plans to pay the rest in instalments over a decade as related by Patrick Bailey, an attorney in the article “Caricel, Spectrum Authority Differ Over Payment For Licence - Former Cable & Wireless Executive Tapped As Chairman Of New Telecoms”, published Friday June 17, 2016 by Steven Jackson, The Jamaica Gleaner.

Whether or not this is actually possible and even known by the Telecom authorities seems to have created quite a stir. But it did reveal more about the internal structure of Symbiote Investments Limited.

Symbiote Investments Limited came in to existence back in 2011. The listed directors are:

1.      Undel Williams
2.      Lowell Lawrence
3.      Natalie Neil
4.      David Shaw

The members are not officially listed as Directors of the company and may simply be founding members. Also the company's main investor appears to be Narysingh LLC, an offshore company with a 89% stake or 85,000 shares in the company and unknown members. Minett Lawrence and Lowell Lawrence have a 5000 share stake and Undel Williams holds another 5000 shares.

Good to note here that by June 2 2016, Undell Williams had resigned while Ian Moore and George Neil were added as directors as noted in the article “Contractor General Carrying Out 'Review' Of Caricel Operator - Ian Moore, George Neil Added As Company Directors”, published Sunday June 26, 2016, The Jamaica Gleaner

David Shaw, who is using his connections as former CEO of the Caribbean business of Cable & Wireless Communication to gain financing for Caricel in London and Hong Kong, may possibly become the Chairman of the newly formed company.

As it relates to infrastructure, they have a measly 200 towers representing some US$40 million worth of investment in Jamaica thus far. So in short, they have no official board of directors and their financing seems somewhat piecemeal, as they only have 200 towers.

According to attorney  Patrick Bailey, they plan to full details of their plans during their official launch, but gave no specific date or timeline, quote: “Caricel will release information on it revolutionary, completely LTE-advanced network as well as equipment and plans when the official launch of the company takes place. Suffice it to say, our rates and plans will be extremely competitive and our technology delivery unmatched. Our network is completely new, and not an upgrade or mix of old and new technologies, so therefore, we believe the consumers will find our offerings quite impressive”.

Also, it's not clear what their strategy will be to compete successfully against Digicel LTE, which has already launched in Kingston and Montego Bay as noted in my blog article entitled “US$50 million 60Mbps Digicel LTE Network as Caricel and FLOW prep for August 2016 Launch”. 

 Their announcements in the media of an partnership with Alepo, a Network infrastructure company and Comtech Telecommunications top launch in the Kingston and Portmore areas as noted in my blog article entitled “How Caricel's 4G LTE Network is being built by Alepo and Comtech Telecommunications Partnership” was a bit premature.

This is what may have drawn the attention of the OCG (Office of the Contractor General).

The OCG and Symbiote Investments Limited - Recommendations to Minister Dr Andrew Wheatley not to sign issued

The OCG (Office of the Contractor General) had some concerns about the operations of Symbiote Investments Limited.

This as one of the principal directors of Symbiote Investments Limited, George Niel, was a principal investor in Index Communications Network, which was the company that launched Gotel back in 2009 as noted in “Cabinet to review OCG report on Caricel”, published Monday, July 25, 2016, The Jamaica Gleaner.

The OCG also had concerns about testing being conducted by Caricel, claiming they'd breached section 63 of the Telecommunications Act, and Section 5 of the Radio and Telegraph Control Act, by using the spectrum without a prescribed licence. Apparently the SMA had detected a signal from the Sutton Street area of Kingston and two other locations, on the same frequency they requested in their DMSL.

Symbiote Investments Limited claims they began testing of their equiptment and had sought the guidance of the SMA, but none was forthcoming. Hence the testing was halted.

Symbiote Investments Limited also claims a legal right to own the equiptment and thus pointed out the conduct of the SMA as it relates to providing them with guidance on testing procedure should also be investigated by the OCG.

The OCG went on further to recommend to the Minister of Science, Energy and Technology Dr Andrew Wheatley to not sign an agreement for the DMSL to Symbiote Investments as they were conducting a review of the company as noted in “Contractor General Carrying Out 'Review' Of Caricel Operator - Ian Moore, George Neil Added As Company Directors”, published Sunday June 26, 2016, The Jamaica Gleaner

Despite this, Prime Minister Andrew Holness has decided that, despite these concerns, Jamaica needs to have a Third Telecom Provider to provided much -needed competition in the Telecom Market.

Prime Minister Andrew Holness and the OCG - Changes coming as 5G ramp up on the horizon in 2020

However, Prime Minister Andrew Holness has taken some of the OCG's recommendations in consideration. These recommendations are as follows:

1.      Non-Jamaicans applying for telecommunications licences should provide all required and relevant information about their shareholders, directors and other officers
2.      Set clear standards to determine whether an applicant for a telecoms licence is fit and proper
3.      Require that the regulatory authorities continuously check that the telecoms licensee is fit and proper to maintain their telecom license
4.      A mechanism to enable the relevant authorities to determine which adverse trace finding, where any exists, would result in a failure of the fit and proper test
5.      A requirement that a person being investigated by the OCG be given a hearing in the course of the investigation before the publication of its report.

There are also recommendations being made for regulations on the following:

1.      Testing of new technologies such as Li-Fi and Fiberless Optical
2.      Guidelines on Sandboxing and testing of equipment prior to DMSL being issued
3.      Emergency use of spectrum by the security forces  

The Prime Minister has sought balance and has achieved it; an overall review of the legal and regulatory framework for the telecommunications industry is to be undertaken.

This will most fall under the Single ICT Regulator, Data Protection Act and Information and Communications Technology (ICT) Act that had been declared on Wednesday, June 22, 2016 as reported in my blog article entitled “How Jamaican ICT Sector is being upgraded with ICT Act, Single ICT Regulator and Data Protection Act”. 

Meanwhile, even as this is ongoing, the Telecoms Customer contracts are under review by the OUR (Office of Utilities Regulation) as noted in the article “OUR To Overhaul Terms Of Telecoms Customer Contracts”, published Wednesday September 7, 2016 by Tameka Gordon, The Jamaica Gleaner.

We are on the cusp of 5G come 2020 as predicted in my Geezam blog article entitled “5G Networks with Renewable Energy, Fiber Optic Waveguides and AI”, correcting these deficit in the current Telecommunications Act of 2012 will take time.

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