With the merger of telecommunications companies LIME and FLOW, one Government official says he is looking forward to robust competition within the domestic sector.
Minister in the Office of the Prime Minister, with responsibility for telecommunications, Senator Darcy Boyce said he was not expecting anything less than vigorous competition between the merged company and its main rival Digicel.
And while he could not say if any applications were currently before Government, Boyce told Barbados TODAY he was quite satisfied that the terms outlined by the Fair Trading Commission (FTC) for the LIME/FLOW deal, would allow any new entrants to compete favourably.
Last Friday, the FTC gave the green light for Cable & Wireless Communications (CWC) and Columbus Communications Inc., which operates here as LIME and Flow respectively, to merge their operations, but with a number of conditions attached.
The ruling came almost five months after CWC made the US$3 billion proposal.
Boyce said he was satisfied that the conditions outlined by the FTC “are not such as to create a monopoly again”.
“Those two companies have shown us that they are prepared to compete very strongly with each other. I don’t expect that all of a sudden they are going to stop competing with each other. There is a lot of benefit for both of them to compete hard,” said Boyce.
“I believe that the terms that the FTC has decided on for the merger preserves the space for active competition between those two major companies. I think it also provides the room for both of them to continue to invest heavily in Barbados and therefore we will benefit from that,” added Boyce.
He said while the island allowed for many players to be in the market, the fact that some of them had been taken over by other companies over the years “suggests that there might be limits” to how many players were actually able to compete in Barbados.
“And if you are going to have competition, you need to have competition from strong companies rather than have other companies that are not able to withstand the pressure from one big company,” he told Barbados TODAY.
“So I think both of the companies we have now will be able to stand up to pressure from each other,” said Boyce.