O’Brien company in legal dispute with C&W

13 Dec 2002

Legal action has begun in Jamaica between beleaguered former Esat boss Denis O’Brien’s Caribbean mobile operation Digicel and the local arm of rival Cable & Wireless (C&W).

Digicel is accusing C&W of stalling an interconnection agreement that is preventing it launching its services in St Lucia and St Vincent.

Relative newcomer Digicel runs a successful operation in Jamaica – of the total phone lines in the country over 900,000 are mobile with Digicel having 452,000, which is 2,000 more than C&W.

In two years, Digicel won 65pc of the market and is reported to have monthly revenues of US$16.7m.

An internal report this week by C&W showed it fears the threat of Digicel.

Ralph Gonsalves, the prime minister of St Vincent, has also been critical of C&W for the delay. Its shares dropped this week after it announced an unexpected potential tax liability of £1.5bn sterling.

C&W began offering mobile service in the late-Eighties. Digicel arrived in the market in April of 2001, a move that was preceded by an aggressive campaign in the market by C&W to try to expand its customer base.

But after being in operation for only a few weeks, Digicel was able to offer more Jamaicans more mobile service that C&W did in over 12 years of providing that service.

Jamaica was this year ranked No. 3 by the International Telecommunications Union in terms of per capita use of cellular service.

By Suzanne Byrne