Digicel yesterday filed a suit to challenge the Guyana Telephone and Telegraph (GT&T) monopoly on international traffic to and from Guyana as the ongoing issue of liberalization in the telecommunications sector spilled into the courts.

The court move, which challenges GT&T’s exclusive licence to carry international traffic, follows an aggressive campaign by the service provider for an end to the monopoly in the market on international voice and data.

Digicel informed of the legal proceedings instituted in the High Court in a press release yesterday. The company referred to the exclusive 20-year agreement between government and GT&T that provides for a complete monopoly on the carriage of international traffic, saying that it is unlawful and unconstitutional, and that it is “seriously hampering the full liberalization of the telecommunications market in Guyana”.

GT&T reacted to the development last night by issuing a press release in which it stated it believes “Digicel’s allegations about our license are spurious and not supported under the law.  We are convinced that their actions have nothing to do with the well-being of the Guyanese consumer.  As Digicel will discover, we are neither unwilling to nor incapable of defending our legal rights.”

Digicel stated in its release that liberalization aids competition by allowing customers choice, better quality and more affordable services. The company said too, that it has already proven it is ready and able to provide a first class service that includes handling international traffic.

Further, the company referred to the temporary international licence that it was awarded in 2007 when the Americas 11 cable was damaged, adding that customers greatly benefited from the service through the increased quality of international calls.

Chief Executive Officer of Digicel, Gregory Dean commented on the suit in the release, saying that the action is all about choice, quality and value for the people of Guyana.
“Since launching operations in Guyana, Digicel has brought an unbeatable mobile service to the people of Guyana and we believe that Guyanese have a right to the same quality and affordability of service with their international calls”, the CEO added.

The company said also, that Guyana remains a notable exception in the region with most other countries enjoying and benefiting from fully liberalized telecommunication services.

The High Court hearing is scheduled for another two weeks with attorneys Ralph Ramkarran SC, Edward Luckhoo SC and Stephen Fraser entering appearances on behalf of Digicel.

Since its launch here two years ago Digicel has been open about its ambitions to compete in the market of international traffic, but has been awaiting the outcome of negotiations between the administration and GT&T on the issue, which had commenced for sometime now.
GT&T’s current operating licence authorizes the company to undertake a range of services in the telecommunications sector including, principally, national and international voice and international data transmission for a period of twenty years. GT&T has an option of renewing its agreement with government for another 20 years, further blocking Digicel’s competition in the market.

But GT&T has indicated its willingness to negotiate on liberalizing the sector and is also on record saying that it accepts the reality of liberalization in the context of global changes in the nature of international telecommunications and has previously stated that “negotiation is the only way out of a negotiated agreement”.

Government has for a number of yeas made no secret of its wish that the GT&T monopoly of the country’s international telecommunications service come to an end, and has been signalling its desire to end the monopoly since 2000. However several efforts for negotiations between the two sides have come to naught.

GT&T statement yesterday said that Digicel is aware that negotiations between the government and ATN/GT&T to alter GT&T’s licence are well advanced.  “Indeed, The GOG has indicated that draft legislation dealing with the liberalization of the sector is imminent and will be shared with all interested stakeholders Further, it is common knowledge that GT&T has made it clear that in the context of successful negotiations it does not wish to extend its exclusive license beyond its first term which ends in 2010.”

GT&T added “What we have asked for consistently is that agreements be honoured and that all operators operate within the confines of the law. All of our traffic statistics point to a well organized international traffic bypass operation aimed at undermining our viability and depriving the treasury of its rightful revenues.  Government since, by our estimates, this activity is costing Government hundreds of millions of dollars.”

GT&T charged that Digicel’s claim that their action is aimed at lowering prices and improving service quality is laughable.  GT&T said it has tried on many occasions to lower international call rates only to be prevented from doing so by the PUC following complaints by Digicel.

“Digicel is fully aware that the temporary international license that allowed them to provide international service for a while could not be justified since the undersea cable cuts that disrupt service periodically has nothing to do with GT&T’s network and that in any event GT&T always has adequate redundant voice capacity in place to carry traffic.   GT&T has continued to invest heavily in the modernization of telecommunications in Guyana.  The public is aware, for example, that GT&T is currently engaged in the build-out of an undersea international fibre optic cable at a cost of US$30 million”, GT&T said.

Digicel has repeatedly pointed out that it has already invested in the infrastructure to offer its customers international dialing, and has consistently called on GT&T to put terms on the table rather than saying it is ready to discuss the monopoly with government. The two telecom providers have clashed in the past over the issue, trading remarks and running promotional campaigns.