Dear Editor,
All countries with market economies outlaw monopolies since they can, by setting either the level of supply or price, optimize their profits to the detriment of consumer surplus.
One way around this, is the creation of regulated monopolies, whereby the harmful powers are removed from the control of the firm and placed with a regulatory body. Further, additional laws, referred to as antitrust laws, exist in developed countries to prevent market concentration and ensure a level playing field for all those wishing to compete. In the USA, the most famous antitrust case was brought by the Department of Justice against AT&T, resulting in its breakup.
In Guyana, the government licensed GT&T to operate as a regulated monopoly for a limited duration offering telephony services. The power to regulate this entity was given to the Public Utilities Commission, a regulatory body poorly funded and under-resourced. As a result of nominal oversight, GT&T was able to enter competitive spheres of the market such as the provision of Internet, Voice over Internet Protocol (VOIP), bandwidth, and until forced to cede control, mobile services. The lack of regulation, not only allowed GT&T to seize back monopoly powers transferred to the commission, but to use these powers to muscle out competition in other markets.
It acquired cables providing nearly all the bandwidth used in Guyana, sold this bandwidth at both the wholesale and retail levels thus competing at the retail level with businesses it was wholesaling to, and as was the case with AT&T, comingled its revenues and costs from these ventures so no distinction could be made between the regulated and non-regulated entities.
Judge Persaud’s decision recognized that GT&T is operating without controls as if in a monopoly market.
It should have been a call to GT&T to desist from its anti-competitive behaviour, but unfortunately, this company’s response is to appeal the decision. Until the new Telecommunications Act takes hold and the authorities recognize the need to provide adequate resources to the commission to carry out its mandate, Judge Persaud’s ruling is the only countervailing force on the table that returns some sanity to the communications sector.
Yours faithfully,
Louis Holder
