Now C&W, TSTT facing competition below the seas

TSTT is keeping a close eye over a new multi-million underwater fibre optic cable, EC-1, a cable which is pitted directly against Cable and  Wireless’ Eastern    Carib-bean Fibre System (ECFS) cable. 

Competition is now the name of the game in the regional telecommunications market with the entrance of Island Fibre Holdings, a Luxembourg registered company, which has been contracted to build the Caribbean’s newest fibre optic cable.
TSTT/C&W backed away at the last moment when the time came to sign on the dotted line. The EC-1 cable is expected to run from Puerto Rico to Trinidad with planned stops along the way at St Martin, Martinique, Guadeloupe, Barbados, St Lucia, Antigua, Grenada, St Vincent as well as the Grenadines, Dominica and St Kitts and Nevis.
There is at present only one cable providing inter-island Internet and data connectivity in the region. This is the Eastern Caribbean Fibre System (ECFS) which is largely owned and controlled by Cable and Wireless PLC.

According to Richard Carruthers, Public Relations Officer of Island Fibre, this C&W cable is operating at maximum capacity and is saturated. “For telecommunications to truly be liberalised and prices to become more affordable to businesses - a new cable is needed,” he said. A second cable, he argues, offers an alternative and resilient communications route off the islands, which many businesses deem critical when deciding where to locate. While there remains only one fibre route off the islands, C&W, he notes, can block new carriers from entering the market. In a telephone interview, David Morgan, Executive Vice President of Network Shared Receipt of Cable and Wireless West Indies, dismissed  Island Fibre’s claim that the ECFS was operating at a maximum capacity and was saturated.

On the contrary, Morgan maintained, the ECFS had recently undergone an upgrade which saw its capacity being increased by 400 percent. This, he stated, provides a capacity for 2,000 telephone channels, which can be further upgraded as required. “This statement by Island Fibre is incorrect,” Morgan asserted, noting that the ECFS had the capability to service the entire Caribbean region. Managing Director of Island Fibre, Keith Rhea said that the company’s current budget for completion of the project stood at $150 million. He said, however, he expected this to be reduced to close to $100 million during final vendor selection. Funding for the project, he said, will come from world level investment banks:  the European Investment Bank, the Inter-American Development Bank, the International Finance Committee of the World Bank and possibly RBTT. Island Fibre, Rhea stated, has already signed a number of new carriers and Internet companies in the Caribbean to participate in a consortium.

They include Ultracom from Puerto Rico, Marpin from Dominica, Digicel, BlueStream Communications, Illuminat (Neal and Massy), WAMCO and Sunbeach from Barbados. Also on the list are Kelcom International from St Vincent, Oceanic Digital, Dauphin Telecom, Guadeloupe Telecom and Martinique Telecom. Additionally, several local communication companies have agreed to be landing partners and manage the cable stations and the distribution of bandwidth. When questioned about Island Fibre’s plan to become the newest telecommunications provider to the Eastern Caribbean, Corporate Communications Manager at TSTT, Rae Ann Harper Walters, said: “We are aware that a number of people are interested in running new fibre optic cables in the region to compete with the ECFS cable.” TSTT is partially owned by Cable and Wireless, which controls the ECFS. According to Walters, the ECFS is a “state-of-the-art” submarine fibre optic cable system which links 17 Caribbean countries, from the British Virgin Islands to TT. It was installed in 1995 and was recently upgraded.

TSTT owns approximately six percent of the ECFS system and it was revealed that it cost US $22 million to upgrade the system from its initial capacity of 32-33 MIUs to 128. This cost was shared among contributing companies, including AT&T and Sprint among others.
“TSTT has an investment in this cable,” she went on, noting that as far as TSTT is aware, the Island Fibre cable terminates in Puerto Rico. “In essence, it’s an inter Caribbean cable so that the people in the Caribbean will still have to find a route to the rest of the world,” she maintained. Walters further noted that TSTT also has an investment in the  Americas I and Americas II cables which takes traffic beyond the Caribbean. In those cables, there is sufficient capacity to allow for growth in traffic, she stated.

She said, “we do not have a problem with people building additional fibre optic cables and over time, just as we have in the past, we will purchase space on fibre as well as satellites for carrying traffic.” “With regards to our prices,” she added, “they are competitive with the other owners of Americas II, such as AT&T. We don’t know anything about the pricing structure of Island Fibre so we will be unable to comment.” Presentations about the project, Rhea said, have been made to governments along the island chain and landing licence applications have been made and several issued. He revealed that landing licences had been received on Puerto Rico Martinique, Guadeloupe and St Martin. However, in the case of Trinidad, he noted, it is just starting the process. The company had requested a ‘Pass Through’ from former Technology Minister Hedwidge Bereaux,” Rhea disclosed. But, “only TSTT can land the cable, so a new licensee will have to be granted.” This pass-through authority allows the company to include Trinidad in the final design and to begin construction. “It will take 18 months to complete and by then Trinidad will have issued licences to a company that will then manage our cable station,” Rhea said.

Rhea noted that the negotiations in Trinidad had come to a standstill since last September, since they had hoped that TSTT would have agreed to land the cable. “After approval of the documents by their lawyers and agreement from Island Fibre, TSTT responded that Cable and Wireless was not ready to join. “We are now awaiting the ECTEL (Eastern Caribbrean Telecommunications Authority) islands licensing before re-opening the discussion with government,” he said. Rhea explained that islands on which the company is unable to obtain landing rights or pass-through approval until landing can be sorted out will be dropped from the design and will have to wait 20 years for the next cable unit to be built. The EC-1 system will contain six fibre pairs with a maximum potential capacity of 3.84 Terabits per second (tbps) and will have an initial design capacity of 10 Gigabits per second (Gbps). The cable will stretch some 2,000 kilometres and will consist of up to 14 unrepeated segments. It  will have a substantial amount of bandwidth reserved and donated for educational and health networks. This, Carruthers maintained, will enable teacher training and student research, with all public schools getting high speed Internet access.
The present bandwidth for the Caribbean region stands at 2.6 gigs and is available on the ECFS. They have another 10 gigs which is used for restoration of another cable called America II.  But this 10 gig is highly unlikely to be made available to the market because it only connects to Trinidad, Barbados and Tortola. The cost to upgrade the rest of the islands is believed to be $30 million.