Latest update April 19th, 2024 12:59 AM
Mar 03, 2013 Features / Columnists, Peeping Tom
Guyana’s problem is not the finite nature of the electromagnetic spectrum; Guyana’s problem is not the overcrowding of this space. Guyana’s problem is just how many carriers can be accommodated on this spectrum in order for these companies to be viable and thus sustained.
Right now in Guyana there are more cellular phones than landlines and the number of mobile users are increasing at a tremendous rate, judging from cellular phone sales. But does anyone seriously believe that a third telephone company can be accommodated in our telecommunication sector? Very doubtful!
Not that this third force would overpopulate the sector. Rather, it would not be viable in a small economy like Guyana. Guyana’s population is too small for a third telephone company.
The same reasoning applies to radio and television. We should be more concerned about obtaining value for the use of the spectrum, rather than trying to share out licences.
If this spectrum, as it is claimed is finite, and if as suggested it is a national resource, then it should be bringing in windfall revenues from all carriers and not just from certain types of carriers.
There is no reason, for example, why instead of persons having to apply for broadcast licences, these licences could not have been auctioned with a starting price of G$25M per licence and an annual renewal fee of about $10M per year. In return, the various broadcasters can be exempted from all property and corporation taxes. But do not tell that to the existing broadcasters or aspiring broadcasters. They will see such fees as exploitative.
Do we really believe that television stations are not capable of netting more than two million dollars in profits each month? If there are dozens of television stations catering to a small population, this may not be possible, but it can be if there are enough stations to ensure competition and avoid monopolies.
Those enjoying monopoly or near monopoly position; those afraid of competition will not always support newcomers into the sector, because the presence of new stations will undercut their influence and their profits.
One has to careful therefore when one hears this argument about the electromagnetic spectrum being finite, because this can be used to further monoploy interests and can mean a shut-out of competition. After all, if the spectrum is finite, why over-populate it with new users.
The idea of a finite electromagnetic spectrum is a myth. It furthers an agenda of those who wish to limit certain foreign powers from entering the domestic market, as well as those who fear that their applications will be bypassed in deference to others.
The electromagnetic spectrum is not as a finite as many feel. In an article in the New York Times entitled ‘Carriers Warn of Crisis in Mobile Spectrum,’ the authors interview David Reed, considered one of the architects of the Internet. Observing that idea of a spectrum divided into frequencies is an outdated one, Reed posits that saying that the nation can run out of the spectrum is like saying it will run out of colour. He argues that technology now makes it possible for everyone to share the spectrum and therefore not exhaust it.
He says that many carriers do not wish to use these technologies that would reduce interference and the reason for this, he says, is that licencing the spectrum is a zero-sum game. When a company gets a licence for a band of radio waves, it has exclusive rights to that band and this means that the company’s competitors cannot have it, thus allowing the company to maintain their stranglehold on market share.
The criticism, therefore, that the government of Guyana is farming out frequencies in a finite spectrum is without merit. The spectrum is not as limited as those who advance these arguments may want us to believe.
What should be of primary concern is not the farming, but the harvest that the treasury is reaping from the allocation of this national resource. Who is really making the hog share from the use of the spectrum? Taxpayers or big business?
Where is the BETTER MANAGEMENT/RENEGOTIATION OF THE OIL CONTRACTS you promised Jagdeo?
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