Prime Minister Sam Hinds says government takes nothing from cable operators for the licences granted to them, since the size of the country’s population would not allow for viable cost recovery through cable service tariffs.
Hinds’ explanation why Guyana was not collecting a fee for the use of its cable spectrum came in wake of a report out of Jamaica that bidders will have to pay at least US$40 million to get one of two new cable licences to be auctioned in that country next month.
The Jamaica Observer reported that the island’s Spectrum Management Authority–whose counterpart here would be the National Frequency Management Unit–is managing the auction of the two 700-megahertz (MHz) band licences, which carry a minimum price of US$40 million and US$45 million for the pricier one. The move is a stark contrast to the vague process used by the Jagdeo administration to hand two licences to persons, Brian Yong and Vishok Persaud, seen as close to the government and the ruling party. The reserve price in Jamaica underlines the value of such licences to the state, which critics of the Jagdeo administration’s licence awards have pointed out. Cable frequencies have the potential to blossom into internet and telephone in addition to television services, thus a potential cash cow for an allottee.
Hinds, asked whether Guyana expects to get any money from the use of the cable frequencies, took issue with Stabroek News’ headline for the story in yesterday’s edition about the developments in Jamaica—‘Jamaica seeking big bucks for cable licences in public auction – what did Guyana get?’
“I want to say that the headline could be somewhat misleading… it says Jamaica expects to get money and then it quotes ‘what did we get?’” he said. “It said Jamaica expects to get money but it hasn’t got any money as yet,” he stressed.
Hinds said governments make some judgements on its situation. “All the monies that these cables are auctioned for, in places like India or China or the US or the UK, eventually that money has to be made back from the tariffs that the companies charge,” he explained.
He added that the large populations of these countries could justify such a process and be depended on to raise the expected revenue from an auction. “Recovering those monies is a very small fraction [for those countries], but in Guyana, where the market is relatively small, so the prospects for earning and selling these things, we took a position against it,” he said.
Every dollar paid to the government would have to come from the rates that they charge, he noted. “So the government took a position to forego or minimise flows to the government, so as to encourage operation and use. We make judgements at the particular time and situations in the particular line of business”.
Hinds advised this newspaper to seek further information from the Office of the President, since he no longer holds the portfolio of communication.
Told of television pioneer Anthony Vieira’s attempts to get Flow – a cable network provider in Trinidad, into Guyana – the PM said that Vieira is free to apply to the Guyana National Broadcasting Authority for a licence to operate a cable network. “And I don’t think anything will be held against him,” said Hinds.
Speaking to Stabroek News, television broadcast professional Enrico Woolford said that persons who prove themselves technically capable should be allowed a licence and the question of auctions and lotteries could come at a later stage. He said that there must be the recognition that the cable spectrum is a valuable resource but cautioned against arrangements which may see most of the money going to overseas companies who might have a small partner locally.
“You have to see who is competent enough to do cable in an efficient manner… it should not be done as a speculative thing where an operator here may tell a large provider they could guarantee a certain number of subscribers a month,” he said. He pointed out that if the process is a speculative one then the foreign partners could ultimately benefit more than the people of the country.
Yong and Persaud were granted licences while Vieira was snubbed even though his proposal entailed revenue to the city of Georgetown. In the year prior to the granting of the licence, both Yong and Persaud were connected in different ways to the campaign to have former President Bharrat Jagdeo re-elected to a third term. Yong had been linked to a group supporting Jagdeo’s re-election to another term. But, in an interview with Stabroek News, he distanced himself from the effort while giving a ringing endorsement to Jagdeo. Persaud’s father, the late Reepu Daman Persaud, had endorsed Jagdeo for a third term.
Jagdeo, in meetings with cable operators in 2007 and in 2010, had admonished them about unauthorised operations. Following that, the next major development was when the government revealed recently that Yong and Persaud received their licence to commence operating in December 2010.
It was Hinds who revealed the names of persons who would have received cable, television and radio licences over an extended period, in response to questions put to him in the National Assembly by AFC MP Cathy Hughes.
The most notable of his disclosures was that of the radio licences and frequencies allocated in November 2011 by former President Jagdeo, just prior to his leaving office. The allocation of the radio frequencies raised questions of transparency and accountability and elicited comments about persons close to the former president or the administration being favoured above others.
Hinds also said that all other cable operators received their licences at an earlier date. He said that Linden Cable Network received its permission in 2007, as had Infinity Telecommunications Inc. in Linden, Linden Cable Network, Bartica Commu-nications Network, Carib Atlantic Cable Network in Mahaicony and E3 Communi-cations in Corriverton.
