In the early 2000s Barbados deregulated and liberalised the telecommunications sector. There was high expectation from consumers that with the Cable & Wireless monopoly broken, new entrants regulated by a fit for purpose regulator, Barbadians would benefit from relevant products, affordable pricing and top drawer customer service. Sad to report, two decades later, only one thing has changed – telecoms are earning more of the backs of consumers.

We have had several mobile providers that have entered the local market and failed. DIGICEL is the only one left standing but barely. If successive governments were serious about wresting high cost of living to the ground, the cost of accessing telecommunication services should have been prioritised as a key strategic national objective. Instead what we have had to tolerate is the usual rhetoric.

How can we seriously expect the cost of living to decrease if one of the key costs continues to rise for individuals and commercial entities. Against this concern the blogmaster listened with interest last week to the news that Elon Musk just bought a key piece of wireless infrastructure that could have favourable implications for Barbados and the Caribbean.

Musk’s SpaceX agreed to buy a portfolio of 800 MHz spectrum from investment firm Grain Management for about $8 billion in cash. Musk called it the “last critical piece of the spectrum puzzle” needed to offer complete phone coverage in America. The obvious question for many of us is – what does spectrum mean in the context of Musk’s decision. In simple terms (AI assisted).

Spectrum is the invisible range of radio frequencies that carry phone calls, texts, and internet data. Think of it as a highway system in the air, where each frequency band is a lane. Governments regulate it because it’s a finite space and companies must buy licenses to transmit on specific frequencies.

The 800 MHz band is low-band spectrum. It travels far and penetrates walls and buildings well, making it ideal for broad coverage, especially indoors. SpaceX is combining this with higher-band spectrum it already owns to build a hybrid satellite-terrestrial mobile network that can serve standard smartphones directly, without a dish.

Barbados has some of the most expensive mobile data prices in the world. In Bermuda, Suriname, Guyana, and Trinidad & Tobago, mobile data costs around $50.20 per gigabyte. The Dominican Republic’s telecom market is concentrated like Barbados with 95% is controlled by just two companies. In Barbados, market competitiveness for internet customers is rated  porakey with FLOW, formerly C&W holding about 68% market share and mainly DIGICEL owning what is left.

This lack of competition and the ability of the market to function competitively has introduced us to the current state. Some Barbadians are already using Musk’s Starlink’s satellite internet service, offering speeds over 100 Mbps with 20–40 ms latency for around $90 to $120 per month. The new spectrum acquisition would allow Starlink to offer direct-to-phone mobile service, bypassing traditional carriers entirely. Were this to occur, it would make the cozy and comfortable relationship between FLOW and DIGICEL irrelevant. Possibly the role of the Fair Trading Commission (FTC).

According to Musk, the smartphone industry needs about 2 years to make changes to support his technology but it seems to be inevitable. On what basis would or porakey regulators try to prevent citizens from accessing affordable telecommunication services?

Many have issues with Musk’s politics and may not like the fact he, a trillionaire with a T, is positioning to make more billions. What are the options for countries like Barbados who are takers of services?

Musk’s spectrum purchase is a direct challenge to traditional telecom carriers like FLOW and DIGICEL. For Barbados it represents a potential turning point, a chance to break free from FLOW and to a lesser extent DIGICEL. At least to reduce the number of ugly cell towers littering our idyllic landscape. It has not gone unnoticed that Jamaica had to avail itself of Starlink services after Hurricane Melissa when FLOW and other traditional carriers became crippled.

Related Link:

SpaceX Buys Wireless Spectrum For Starlink; Verizon, AT&T, T-Mobile Tumble