Digicel have been quietly angling for a license in Myanmar since early 2010, back in the days when Aung San Suu Kyi was still shut in and the junta was jailing people for dissent. Since then, up to a dozen Digicel officials have been staying at the luxury hotel and working out of an unmarked office in Yangon’s Sakura Tower. They are reportedly providing technical assistance to MPT and even sponsoring a local soccer team—an attempt, says a Yangon-based former consultant to the company, to get into the same room with regime cronies and government officials.
Well now we know as of the 3rs Feb Digicel Group has officially thrown its hat in the ring to be considered for a telecommunications licence in Myanmar, formerly known as Burma. The company said that it submitted its expression of interest in a bidding process, which is expected to yield two new licenced operators within the next five months.
What the selection committee will use to decide who gets the licences are still not clear, but the country will require the winners of the two nationwide telecommunications licences to “meet or exceed specified population and geographic coverage targets”.
What is clear to me is Myanmar is one of the most corrupt countries in the world and to do business in that country you must grease some palms.
However if short on manpower he can always call on Bert the Drumcondra drunk for assistance or else get the Bonox to lobby Amnasty International and Suu Kyi, to help him out with a slice of the cake….
Singapore’s SingTel, Norway’s Telenor, Malaysia’s Axiata Bharti, and India’s Airtel are also named among the bidders.
Despite all the groundwork that was put in place to open up Papua New Guinea’s mobile communication market, there are those who still think of the interest shown by Irish-owned, Jamaica-headquartered GSM giant Digicel as a war that is being waged.
To incumbent carrier Telikom PNG, this is a war that it believes is being fought in a playground where unethical tactics and cleverly executed manoeuvres would be employed by the newcomer in order to get what it wants.
In August, Telikom PNG warned its workers through its corporate newsletter of “an opponent who might play by different rules”.
By last month, Digicel and competition in general had become to it as “enemies at the gate”, and in an attempt to motivate patriotic sentiments against these “enemies”, called on its workers to “stand together”.
“Telikom has many enemies at the gate at the moment and the last thing we need as a family is enemies within,” urged PNG Telikom acting CEO, Peter Loko.
He went on to implore the increasingly agitated workers to “look at the forces lined up against us at the moment”.
“We have competitors who do not always appear to act ethically. While we follow the laws of PNG, others do not always seem to feel the same responsibility. We have regulators who make decisions that go against us, although we are obliged to act under the laws and regulations of the country. This sometimes does not seem fair, especially when others seem to be able to break the rules without penalty.
“We have some people in positions of influence in the media who seem to take delight in showing up our faults. They may be acting honestly and in the public interest as they see it, or they may be influenced in some way to write against us. We should not give them gossips or backdoor stories. There are already enough lies told about us. We will continue to be honest and ethical, and try at all times to tell our side of the story factually and hope for fair treatment, letting the public decide.
“We are being physically attacked. There is evidence on all sides that a war of criminal sabotage is being waged against us, cutting our cables, destroying our network, disrupting our services, stressing our staff and costing us money…there are enemies at the gate. Let us fight them as a family.”
Having abruptly “awoken from a deep sleep and found that they suddenly had the spectre of some competition looming on the horizon” as described to this magazine by an industry observer, Telikom PNG is going all out to take on the new force in what is increasingly looking like a David versus Goliath showdown.
Except this time, it looks like God has left town and the actual battle is being fought in the middle of serious allegations of corruption, criminal activities, accusations of favour-buying and industry uncertainty as government proceeds to put in place a new ICT policy that would nationalise all networks and liberalise service.
War started: “This war has just started,” Loko told ISLANDS BUSINESS. “We have had cable cuts (by vandals) where we have never had it before and strangely, they just cut it and leave it there. We had to ask why? Why are they doing this?”
It couldn’t possibly be Telikom PNG, he argued, for “why would we go and kill ourselves?”
Earlier on during mid-month, PNG’s Ombudsman Commission issued a press release and expressed concerns over “allegations that a certain telecommunications company is issuing bribes to lure political support at the national parliament to promote its business interest in the country”.
“Elected leaders have a duty to conduct their public duties as required by the Constitution,” said chief ombudsman Ila Geno in a statement he jointly signed with ombudsman John Nero and acting ombudsman, Roderick Kamburi.
“On the same token, the commission appeals to business enterprises, foreign or otherwise, not to approach the decision-makers and leaders of this country in this alleged manner. If the allegations are true, it is a serious corrupt conduct and a serious threat to good governance, good leadership and democracy in PNG. This country is battling with corruption. What is the political party in government doing with this company? What right does this company have to approach PNG’s elected leaders in this alleged manner?”
The relevant licensing and regulatory authorities have also been roped in and are teetering at the edge of being polarised by the politics of this war. On one corner is the Independent Consumer and Competition Commission (ICCC), a victim of its own doing when, in 2005, acted upon the gazetted notice by the Somare government to introduce competition in the mobile telecommunication market after March 2007.
“The ICCC is required by law to ensure that government policies, which are approved by the NEC (National Executive Council, the government cabinet) and notified to ICCC, are carried out. And we did,” said ICCC commissioner and CEO Thomas Abe in his speech to the Port Moresby Chamber of Commerce and Industry early last month.
“Unfortunately, not every government agency apparently felt the same way. The IPBC (Independent Public Business Corporation—created by government to support the commercialisation of public enterprises), as the sole shareholder in Telikom, continued to advocate a position that would have prevented the introduction of mobile competition from March 2007. Telikom, from about mid-2006, also tried to frustrate the policy by instituting multiple legal actions against the ICCC, several of which were dismissed by the courts as an abuse of process,” said Abe.
“Earlier this year, the ICCC was on the brink of agreeing with Telikom, at the most senior levels, to settle all legal proceedings and work towards a sensible introduction of mobile competition. Telikom was instructed to stop talking to us and not to agree to anything.”
Coming in as a counter force is PANGTEL (Papua New Guinea Telecommunications Technical Authority), seen by critics as being influenced by special interests after its failed attempt to withdraw Digicel’s radio spectrum license in July.
As tension and uncertainty in PNG’s telecommunication industry slowly gathers pace. Some fear it could snowball into something unpleasant. It is also clear that this is also a war of technology and one where PNG Telikom has been caught napping.
“Digicel has ‘been there and done that’ so they are experts in the art of fast rollout of network that I think Telikom vastly underestimated the opposition’s ability to get things moving that fast,” said Terry Griffiths, PNG-based radio frequency consultant and former manager of Pacom, distributors of radio equipments in PNG.
“When Digicel launched its system a few weeks ago, it immediately commenced very aggressive advertising and pricing of its products and services and again, this caught Telikom offguard. Now the two companies are trading advertising blows in the local papers and billboards around the country,” Griffiths told ISLANDS BUSINESS.
Major upgrade: “The Telikom infrastructure is also very tired and in need of a major upgrade.This includes all the remote sites they are using for the GSM system as well as their microwave backbone and fixed line cable system. It is obvious that the excessive spending on advertising has resulted in them having problems funding any real upgrades at this stage. In comparison, the Digicel system is all new, latest version system and the coverage and general operation leaves Telikom for dead. The only real issue is the restriction on Digicel to interconnect into either the Telikom fixed line or mobile network and this appears to be a political issue rather than any real technical reason. It obviously means that Telikom is missing out on a lot of revenue through their networks because of the restrictions. In essence, the competition has woken Telikom up, increased the connection of the Telikom GSM phones on to their network and made them a bit more market-oriented, which is long overdue.”
The issue has all the makings of a very difficult problem for the Somare Government, who is now perceived to have changed course from its initial intention to open up the mobile communication market. Whatever picture it had in mind when it envisioned that, liberalisation was obviously far removed from what became of the industry in 2007.
Last month, Somare made it clear in the country’s parliament that competition was welcomed but any telecommunication infrastructure, its management and its control must remain the sovereign property of PNG and its people, as will be the result of the new servco/netco model that the PNG Government has now adopted. And among the hues and cries against this, there are those who seriously believe that something should indeed be left behind in the liberalised industries for Pacific people to own.
“I support the major telecommunications network remaining in the hands of the government, as well as power and water for that matter. But if, as has been agreed you are going to let competition in, then give them a fair go and meet them with a vibrant and competitive operation,” Griffiths said.
Politics aside, the ball is now in Telikom PNG’s court.
Tomorrow: Digicel to fight tax raid in court – Jamicia
When Haitian President Michel Martelly visited the Dominican Republic last month, he was awarded the country’s highest honor for a foreign head of state, in large part for his efforts to lure reconstruction investment to Haiti after its catastrophic 2010 earthquake, which killed more than 200,000 people. In an interview in Santo Domingo, the Dominican capital, Martelly told TIME he’s “tried to change the perception [the world] has of Haiti as a place where nothing works,” and he listed his accomplishments so far, including $450 million in tourism investment. “Haiti is a land of opportunity,” the boisterous former carnival singer said. “Because Haiti is still a virgin.”
But a few days later, accusations of less than virgin behavior were swirling around both Martelly and one of the Dominican Republic’s most prominent politicos. In a March 31 national television broadcast, Dominican investigative reporter Nuria Piera alleged that Dominican Senator Félix Bautista — who owns or controls construction companies that in the past year have received Haitian government contracts worth more than $200 million — paid Martelly a total of almost $2.6 million during Martelly’s presidential campaign and after his landslide victory in Haiti’s 2011 election. The charge, based on spreadsheets of bank records Piera displayed on the air, was serious enough to prompt Dominican federal prosecutors to declare Bautista under investigation. Both the Senator and Martelly, whose office calls the allegation “a media lynching,” deny it.
(PHOTOS: After Quake, Carnival Returns to Haiti)
The Bautista controversy, fairly or not, is a jolting reminder of Martelly’s mixed record — and the governmental dysfunction still plaguing Haiti during its recovery — as he approaches his first year in office next month. The construction contracts in question, including one to rebuild Haiti’s legislative palace, were awarded in 2010. But late last year they became the targets of an audit by Martelly’s then Prime Minister, Garry Conille — who in February resigned largely because of pressure from members of Haiti’s parliament and Martelly’s government, who resented the scrutiny. The exit of Conille, a trusted technocrat whose appointment was backed by the U.S. and the international community, set back Haiti’s recovery efforts and highlighted the acrimonious relationship between Martelly and Parliament.
Piera’s corruption investigation suggests that Bautista, a leader of the ruling party of Dominican President Leonel Fernández, made the payments to Martelly, who was a heavy favorite to win Haiti’s March 2011 presidential vote, in order to keep winning contracts under the new Haitian government. In a joint declaration on Thursday, April 12, both Fernández’s and Martelly’s administrations called the journalist’s charges part of a vague “plot” by opponents to discredit Martelly and aid the Dominican opposition in that nation’s May presidential election.
(MORE: Quake-Ravaged Haiti Still Without a Government)
Either way, the controversy has forced Martelly off message yet again. When he met with TIME last month, he seemed to have put the Conille resignation flap behind him — his new Prime Minister choice, longtime friend and business associate Laurent Lamothe, has been approved by the Senate — and talked confidently of new investment ventures that he hoped were a signal that “Haiti is open for business.” He emphasized the positive reception he’d gotten at the World Economic Forum gathering in Davos, Switzerland, in January, when Irish billionaire Denis O’Brien, head of cellphone powerhouse Digicel, as well as the chairmen of Marriott, Heineken and Nestle, all spoke “about what an opportunity Haiti is,” he said.
Digicel and Marriott, in fact, have since joined forces to build a $45 million, 173-room hotel in Port-au-Prince, and last month an arm of the World Bank Group pledged a $10 million fund to spur small- and medium-size businesses. The “Invest in Haiti” forum that Martelly hosted last November drew a thousand capitalists from industries like tourism, infrastructure, agriculture and textiles and resulted in $200 million in contracts. The Haitian government itself is poised to spend up to $700 million, meaning the western hemisphere’s poorest nation could see at least $1.25 billion invested inside its borders in the coming months. “Once we invest that,” Martelly told TIME, “you attract other investors and companies and they feel like things are moving. You’ll have more of that coming.”
Tomorrow:- O’Brian and Digicel Never far from Controversy – Haiti, Digicel National Fund for Education smells fishy