Minister: Reform Of Telecommunications Industry

Good Morning,

The purpose of today’s press conference is to update the public on the status of work with respect to the implementation of reform in the telecommunications industry.

You will recall the passing of the Electronics Communications Act and the Regulatory Authority Act in November 2011. It is well known that product and service developments as well as customer expectations in this industry have outpaced the current legislative framework and hence the introduction of these two Acts.

These two milestone pieces of legislation are indicative of this government’s commitment to establishing a framework that would enable the telecommunications industry to move into the 21st century.

This legislative step was an important one and one which will lead to the issuance of Bermuda’s first Integrated Communications Operating Licence or ‘ICOL’. Issuing the first ICOL remains a major milestone of the telecommunications reform but, in order to get to that stage, there are a number of significant steps that will be accomplished along the way.

Members of the media, allow me to share with you what has been accomplished to date, what the next steps are and when we can expect to see further progress on the way to full implementation of this reform as envisioned by the architects of the plan.

During the budget debate this year, I made the case for allocating one and a half million dollars to my Ministry and by extension the Department of Telecommunications, so that the implementation plans for reform would be funded as required. Those funds became available as of 1st April this year.

The Ministry has already begun the search for a Chief Executive Officer to head up and lead the soon-to-be established Regulatory Authority. This local and international search has identified a healthy range of qualified candidates and I expect that I will be able to make an announcement regarding the appointment of that officer towards the end of July this year.

The appointment of a Chief Executive Officer will signal another major milestone along this road to reform. The CEO will have full responsibility for breathing life into the Regulatory Authority. The CEO will be supported by a team of professional staff with expertise in the fields of law, engineering and economics.

In addition, the Minister of Justice Senator the Hon. Kim Wilson JP will soon appoint the four Telecommunications Commissioners as set out in the recently passed legislation.

Going forward, we plan to retain the services of private sector expertise in the field of telecommunications law and economics. This support will translate into the production and delivery of another set of key milestones to progress the reform in the industry. Furthermore, this support demonstrates and affirms the commitment from this Ministry, on behalf of the Government of Bermuda, to attracting and retaining foreign direct investment in this critical industry.

This private sector support, which has been sourced from both the United States and the United Kingdom, will be responsible for providing the needed expertise to deliver the final products attached to the major work streams that will define the progress towards reform.

These include an economic assessment of the current market and the dominant positions held by particular players. This assessment will confirm where the significant market power lies and will in turn inform the process of establishing the structure and content of the future licences.

Another key area of work that will be completed in the next few months will be a comprehensive spectrum audit. The outcome of this work will be of major interest to the market as there is a spin off in the form of a new revenue stream for Bermuda. I expect that these steps would be completed over the next few months.

At this stage, I can commit to issuing an ICOL no later than March 31, 2013. As the Ministry fully engages and mobilizes the technical and professional expertise in the coming months, we shall be working diligently to deliver in advance of this critical date.

In this regard, I shall provide an update at the beginning of October this year. However, there is much to be done between now and then and the support of the industry will be pivotal to our ability to hit this target.

I have to tell you that I am very enthusiastic when I consider the potential for growth in this vital industry. Bermuda has one of the highest per capita levels of residential internet connectivity and cell phone usage in the world.

Furthermore, our local and international business clients depend on an efficient and effective telecommunications industry. So our strides towards reform are also driven, in part, by the needs of our current and prospective corporate citizens as well as the many Bermudians and residents that have come to depend and rely on efficient and cost-effective telecommunications services.

This Ministry is well aware of the valuable role that the telecommunications industry plays in our macro-economic sustainability. Alongside this importance is the need to ensure that the Bermuda’s customer base, both commercial and residential and investors in the industry, are able to experience both value for money and a return on any investment.

The Ministry takes the view that the government, as regulator of the industry should be an enabler and a facilitator that operates with minimal market intervention.

We also believe in the saying that “the customer is King” and that the Ministry should create and clear the way for this dynamic and evolving industry to be driven by the invisible force of competition.

I look forward to addressing you again in the near future with further updates on our progress towards our important goal to create an efficient and effective regulatory regime that creates the conditions in which business can thrive while protecting the public interest.

Thank You.

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