{"id":428,"date":"2011-03-29T06:41:51","date_gmt":"2011-03-29T11:41:51","guid":{"rendered":"http:\/\/www.ict-pulse.com\/?p=428"},"modified":"2011-03-29T07:13:28","modified_gmt":"2011-03-29T12:13:28","slug":"is-the-claro-sale-to-digicel-good-for-competition-in-jamaica","status":"publish","type":"post","link":"https:\/\/ict-pulse.com\/2011\/03\/is-the-claro-sale-to-digicel-good-for-competition-in-jamaica\/","title":{"rendered":"Is the Claro sale to Digicel good for competition in Jamaica?"},"content":{"rendered":"

On March 11, it was announced that Digicel had purchased Claro, the third mobile operator in Jamaica. The transaction will effectively reduce the number of mobile operators from three to two. This post examines some of the regulatory issues that should be considered.<\/em><\/p>\n

Mergers and acquisitions of telecoms companies are not unusual. Towards the end of March, a merger was announced between AT&T and T-Mobile in the USA. A few days earlier, it was revealed that America M\u00f3vil, the Mexican telecoms giant, would be selling Claro, its Jamaica subsidiary, to Digicel, and America M\u00f3vil would acquire Digicel\u2019s El Salvador and Honduras operations. The transaction is subject to regulatory approval in Jamaica, but concern is being expressed in some quarters on the likely effects of the purchase on the mobile market. This approval is the remit of the Minister with responsibility for telecoms. He will be advised by a number of sources, most importantly, the competition, spectrum and utilities regulators. Discussed below are a few of the regulatory issues that must be considered.<\/p>\n

Competition<\/h3>\n

The extent to which competition in the mobile market will be affected by the purchase is expected to be the most crucial consideration of the regulatory review process. In any market where fair competition is desired, it is important that no one player controls the market or is unaffected by the actions of its competitors or of consumers. Currently, Digicel is reported to have the largest share of the mobile\/cellular market in Jamaica. Although Claro had the smallest market share of the three operators, Digicel\u2019s market share will undoubtedly increase thanks to the acquisition. Hence the regulators should consider the impact of this change with regard to (among other things):<\/p>\n