The “blitz” that descended on Guyana last week in the wake of Digicel’s launch of its new cellular service here provided an object lesson in mass marketing that Guyanese are unlikely to forget in a hurry. The phenomenon, as President Bharrat Jagdeo pointed out, marked the coming of age of competition in the local cell phone industry, an eventuality which the government has been advocating for some time.
Digicel has come to Guyana with a reputation as a regional “giant killer” and the scale and intensity of its launch here suggests that unlike its predecessor, U-Mobile, it is not prepared to play a quiet “second fiddle” to GT&T. For its part, GT&T has joined the price “war” on handsets and has even moved to the point of offering free handsets in exchange for customer loyalty.
Low prices and free handsets may well have brought about a significant change in the local cellular culture. While accurate estimates are difficult to come by it now seems clear that appreciable numbers of Guyanese have decided to emulate their counterparts in other parts of the Caribbean, chiefly Barbados, by subscribing to both GT&T and Digicel. Once that happens the competition will shift from the handsets to the actual cellular service since consumers – whether or not they subscribe to both services – will be inclined to use the one that combines cost effectiveness and efficiency. In Georgetown, at least, there is every indication that most people now own at least one handset and while both GT&T and DIGICEL have been extolling the virtues of more efficient and reliable communication that will result from the proliferation of the cell phone there is, also, the less pleasant side of the coin. Both here and elsewhere in the Caribbean quite a few horrific road accidents have been attributed to the use of cell phones by motorists while the uncontrollable access to the service raises the likelihood of unfortunate consequences arising from criminals and schoolchildren owning cell phones.
Just how long the cellular industry in Guyana will continue to expand is, of course, anybody’s guess. Certainly, Digicel has some catching up to do since GT&T may already have as many as 200,000 GSM customers and, at this stage, an appreciably smaller number of users of the older TDMA service. Digicel may, of course, have good reason to believe that it can prosper in the local market given the fact that it has already been able to persuade consumers that two services may be better than one. For its part, GT&T’s recent renovation and recent further “build out” of its network infrastructure has won the company some positive reviews from cellular service users.
The “head to head” competition, of course, will make the marketing “steel” much more keen in Guyana than in Barbados where Digicel and the ageing British pioneer Cable & Wireless and a third, smaller service provider, a local company called Sunbeach are engaged in a much more sedate competition for market share. A report published in the February 12 issue of the Barbadian business paper, Business Authority, strongly suggests that what was once one of the fastest growing industries in the country may well have reached a plateau. Between 2000 and 2003 Barbadian cellular subscribers rose from 10.6 subscribers per 100 inhabitants to 19.4 subscribers per 100 inhabitants. By 2004, following the entry of Digicel into the Barbadian market the number reached a whopping 63.1 subscribers per 100 inhabitants.
Industry officials doubt that the service providers can squeeze much more “juice” out of the Barbadian market. The Barbadian government is reportedly yet to find a “taker” for its offer of a fourth cellular communication licence offered last July and the authorities have reportedly given up on expanding the industry any further, at least in the short term.
The local cellular service industry, is, of course, poised for further expansion with the advent of Digicel. An estimate of around 300,000 cellular customers is reportedly nowhere near what the market can accommodate. GT&T’s network “build out” is still not complete and with Digicel set to consolidate on what it inherited from U-Mobile handset markets are likely to expand further in rural and hinterland areas. Certainly, Digicel appears to be of the view that the local market can probably accommodate at least twice the number of persons currently owning cellular phones. The competition between GT&T and Digicel for market share, therefore, seems set to continue for some time.
