C&W ‘leaner and fighting fit’

By Ayo Johnson
(Business from 2001-01-24 Edition)

CABLE & WIRELESS is looking forward to "respectable" growth in outbound calls, despite aggressive overtures by callback services.
And, general manager Eddie Saints said, the company would have no objection to a service like GlobalTel being given a licence to operate "on a level playing field" in Bermuda.
Saints told the Bermuda Sun that his company was managing to lure locals from callback services.
"We are pleased to say our business is growing," Saints said. "The things we are doing from a commercial standpoint are having a very positive effect."
But he acknowledged that an unusually high amount of inbound calls recorded during the last quarter of 2000, could at least partially be attributed to callback subscribers.

New York based GlobalTel has persisted in offering its service to locals despite being banned by the Bermuda Government.
Bermuda’s position is that companies like GlobalTel have not made any investment in telecommunications infrastructure which is unfair to existing long distance carriers.
The company has said that it would gladly set up in Bermuda as a regular long distance carrier, but its interest in a licence to do so has been rejected by the Ministry of Telecommunications and E-commerce.
"We support anybody who wants to get into this business," Saints said. "He would have to demonstrate to [Telecommunications Minister] Ms Webb that he is the sort of person we want to do business here… There’s a process in place. If he meets the criteria then we’ll all get on with it." Saints wondered, however, what kind of infrastructural investments GlobalTel would make in Bermuda.

Level playing field "I’d like to know what undersea system he’ll be putting in… Certainly it’s a level playing field. And we’re all competing fairly and we are all doing reasonably well."
Just how well Cable & Wireless is doing, he wouldn’t say specifically. But Saints revealed that the company’s latest promotion — the Big Deal programme — offering calls to the U.K., Canada, U.S. and Ireland for as little as 25 cents a minute — had seen new subscribers who openly admitted that they had been GlobalTel customers.

Cable & Wireless was the incumbent monopoly in the long distance market when deregulation of the telecommunications industry began in 1995. The process has seen rates drop from $1.25 to around 25 cents a minute, the introduction of Voice Over Internet Protocol and the entry of challenger TeleBermuda International and Internet Service Providers North Rock and Logic Communications. Long distance carriers can now also offer Internet services to business. Cable & Wireless has emerged from it all leaner and fighting fit, according to Saints.
"Basically, Cable & Wireless, throughout the entire year [2000] has seen growth in outbound calls. That’s encouraging from our standpoint," he said. And "not humongous, but respectable" growth was forecast for 2001.

Above normal But Saints also revealed that the volume of incoming calls which normally dips by about 30 per cent during the last quarter of the year, had shown an "abnormal" increase of around 30 per cent for the period and projections through January show a volume "way above" normal.
"I can attribute some of that to callback activity," he said. But it is difficult to pinpoint exactly how much. Some of the calls could be attributed to carriers exchanging international minutes, he said. "The bottom line is that callback is still prevalent. We have not been able to stop it."

Last week the Bermuda Sun reported GlobalTel CEO Steve Williams as saying that his company would be offering calls at 10 cents a minute on a limited basis next month.
"I guess he’s not getting the business he thought he might get," was Saints’ response. Cable & Wireless is not at all threatened by the news. "Bermudians have the final say," Saints said. But GlobalTel can only compete on price — not value, he added. "As long as we continue to offer value at competitive prices, we have nothing to worry about," he said.
Saints strongly denied a claim made by Williams last week that GlobalTel’s activities were responsible for forcing down long distance rates in Bermuda.
"GlobalTel responded to the rate reductions. We are not responding to him because we know it’s only a matter of time before we can prevent operations."

TeleBermuda International declined to comment.