Jamaica's Fledgling ICT Sector

Information Communication Technology - or Technologies, It is commonly known as ICT. The initials are often thought to encompass computers and technology. However, in simple terms, ICT facilitates access to information using various communication technologies.

Technopedia, defines ICT - "refers to all the technology used to handle telecommunications, broadcast media, intelligent business management systems, audiovisual processing and transmission systems, and network-based control and monitoring functions."

Visual representation of ICT. Source of image: newtelegraghonline

ICT adoption has significantly grown over the years, with little signs of slowing abating. In fact, Ericsson mobility report is predicting a 12-fold growth between 2012 and 2018. The article entitled Trends in the ICT sector, went on to state, and I quote " This ICT expansion helps economic growth and development, and makes the world a more accessible, open and democratic place."

The expression by Ericsson is not dissimilar to World Bank's take on the ICT Sector. The World Bank suggests that ICT is changing the makeup of the world economy, governments and the society at large. Additionally, the World Bank evince that for every 10 per cent increase in high speed Internet connections, a 1.4 per cent increase in economic growth follows on average.

Jamaica's Emerging ICT Sector

Following the phased liberalization of the telecommunications sector in Jamaica, as expressed in my blog post entitled The Liberalization Of Jamaica's Telecommunications Industry; Impact On The Jamaican Economy And Communications, mobile penetration grew exponentially. The aforementioned rate is estimated to exceed 100 per cent, coming from a low of under 10 per cent before liberalization. However, this rate of growth was not replicated with Internet penetration. A 2013 estimate by the World Bank, suggests that just over a third of Jamaica's population has accessible Internet. Indicating that significant room for growth remains.

However, significant smart phone take up has transformed the means of communications to the Jamaican public. This was evident by Digicel Jamaica's November smart phone sales, available in the news release entitled Digicel Has Sold 60, 000 Smartphones Since November. With greater smart phone adoption, communicating via social media has become effortless and affordable. Additionally, businesses may easily access customer demands through social media platforms.

A commendable step taken by the government of Jamaica, is the recent launch of the tablet in schools program. It is a joint program by the ministry of education, and ministry of science, technology, energy and mining. The aim of the program is to facilitate robust ICT, and greater levels of economic growth. Under the tablet in schools program, approximately 25 000 tablets should be deployed at an estimated cost of J $1.4 billion.

Additionally, the Business Process Outsourcing (BPO) sector has grown markedly since liberalization. Furthermore, Jamaica's Relatively low labour cost and high unemployment rate, makes Jamaica an attractive BPO destination. This is borne out by the approximately 40 BPO firms, employing in excess of 14 000 Jamaicans.

Buoyed by signicant investments in telecommunications and BPO, ICT should continue to facilitate existing and new means of communication by the public. This should allow for greater tech startups, and higher, more equitable GDP growth.

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References

Information & Communication Technologies Overview, World Bank.
http://www.worldbank.org/en/topic/ict/overview#1

Jamaica Tablet Program For Schools, Addictootech.
http://www.addictootech.com/jamaican-tablet-program-schools/

BPO Offers Good Jobs, Jamaica Trade and Invest.
http://www.jamaicatradeandinvest.org/news/bpo-offers-good-jobs

Internet Users, World Bank.
http://data.worldbank.org/indicator/IT.NET.USER.P2

The liberalization of Jamaica's telecommunications industry; impact on the Jamaican economy and communications

Prior to September 30 1999, Cable & Wireless (now LIME  Jamaica) had a monopoly in Jamaica's telecommunications sector. The aforementioned monopoly license was valid until 2013, with the option of being renewed thereafter. However, this never came to fruition. On September 30, 1999, an agreement was signed between Cable & Wireless and the government of Jamaica. This agreement facilitated the phased liberalization of Jamaica's telecommunications sector. Full liberalization was completed in March 2003.

With monopoly in the telecommunications sector being history, the market was made open to new investments and competition. Two new telecommunications licenses were issued in 2000, the two entrants were Digicel and Oceanic Digital Jamaica. In excess of US$ 90 million was secured from the sale of the two licenses. Jamaica facilitated further competition in the telecoms sector with the entry of  triple play provider Flow in 2005.

With the issuing of two mobile carrier licenses and the entry of triple play provide, Flow. Jamaica saw exponential growth in the telecommunications sector. Oceanic Digital entered the Jamaican market in 2000, the company had a partnership with Centennial Communication, but later acquired the company's shares in 2002. Oceanic Digital was known later as Claro Jamaica upon America Movil's acquisition on August 23, 2007. Digicel began operations in 2001; with this, Digicel saw mobile subscribers increasing to 100 000 within their first four months of operations. Flow entered the Jamaica telecommunications sector in 2005. Flow's product offerings include: fixed line, digital internet and broadband internet. It is postulated that broadband internet cost were reduced by 60% with the entry of Flow.

Feeling the effects of an increase in competition, Cable & Wireless announced plans of rebranding to LIME (Landline, Internet, Mobile Entertainment) Jamaica in 2008. Rebranding of LIME's Jamaican operations was completed in 2009.

Impact on Jamaica's Economy

Liberalization of the telecommunications sector has had a positive impact on Gross Domestic Product (GDP) and Government revenues. Investment by the various players in the telecoms sector, has been quite significant since liberalization began in 1999. In excess of US$ 2 billion has been invested in Jamaica's telecoms sector by LIME, Digicel, Claro and Flow over the last decade; with direct employment exceeding 2000, and many more indirectly.

Possibly of most significance, liberalization has led to increased competitiveness and growth in the Information and Communications Technology (ICT)/Business Process Outsourcing (BPO) sector. The ICT/BPO sector contributes approximately 5% to GDP, employing over 14 000 individuals.

Consumer benefits of competition in the mobile market is said to have exceeded J$ 16 billion between 2007 and 2011, largely due to fierce rivalry among the top three major players. Liberalization of the telecommunications sector has also facilitated growth in e-commerce through the growth in mobile and internet subscribers.

Impact on Government revenues has been no less outstanding. US$ 92 million in government funds was secured from the sale of two mobile carrier licenses in 2001. Most recently, the renewal of mobile carrier licenses and the award of new spectrum licenses saw the government of Jamaica receiving US$ 115 million in revenues.

Impact on Communication

Prior to liberalization in 1999, there were less than 100 000 mobile subscribers and a penetration rate of approximately 5%. There are now approximately 2.8 million mobile subscribers and a penetration rate that is over 100%.  Internet users grew significantly over a similar period, though not as fast as mobile subscribers. There were under 80 000 internet users prior to 2000, this number stands at approximately 1.6 million as of 2009.

It is undeniable that Jamaicans had limited means of communication pre-liberalization; this is now virtually a thing of the past. From phone calls to smartphone apps; Jamaicans can communicate with family members and friends across the globe. This was made possible with substantial investment in GSM (Global System for Mobile Communications), wired and wireless broadband technologies as evident from the information presented above.

The bold steps taken by our legislators on September 30, 1999, has led to exponential growth in mobile subscribers and  internet users. Steps taken to liberalize Jamaica's telecommunications sector has also facilitated significant investments and economic benefits thereafter. With the information I have just presented; It is clear that the telecommunications sector will continue to play a major role in Jamaica's current and future development. 

References:

* http://www.sma.gov.jm/sites/default/files/Telecommunications_in_Jamaica_and_the_Caribbean.pdf

* http://www.mmt.gov.jm/PDF%20Files/MEMT/supplement.pdf

* http://www.jftc.com/Libraries/Industry_Studies/Telecommunications_Liberalization_Impact_Assessment.sflb.ashx

* http://www.jamaicatradeandinvest.org/success-stories/digicel-expanding-global-brand-created-jamaica