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May 13 2011

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Snapshot: Internet speeds and prices in the Caribbean

Continuing with our Snapshot series, we look at Internet prices and the speeds that are available across the Caribbean.

The Caribbean has had some semblance of publicly available Internet service for about two decades, but in recent times it has become a key platform for the delivery of a broad range of telecoms and computing services and applications. Critical considerations when assessing the Internet’s effectiveness as a medium of connectivity are transmission speeds and the prices charged for its use. This snapshot examines those two factors across the English-speaking Caribbean, since they speak to the region’s ability to harness the potential of the Internet and to create knowledge-based societies.

Methodology

Data for this review was collected from the websites of widely used Internet Service Providers (ISPs) in the region. At least two ISPs were examined in each country where present (Table 1), and the exercise was limited to non-dialup Internet services and to service plans for domestic/residential customers. The offerings from the ISPs varied drastically in terms of transmission speeds, hence the exercise was limited to identifying (per country):

Table 1: List of ISPs included in exercise

  • the lowest download speed available and the corresponding monthly rate
  • the highest download speed available and the corresponding monthly rate
  • the monthly rate for a 2 Mbps (Megabits per second) service plan.

 

It is emphasised that the review focused on the monthly rates payable for specified Internet plans only. The exercise excluded initial subscription and activation fees, as well as any additional monthly service charges that might be payable, but included sales taxes (GST, VAT, GCT, etc) when applicable. The rates were converted from the local currency to United States Dollars (USD) using current commercial exchange rates.

Under International Telecommunications Union (ITU) standards, between 1.5 and 2 Mbps is considered the threshold speed for classifying an Internet service as broadband. Hence 2 Mbps has been used as a baseline reference to compare rates across the countries under review.

Results

As reflected in the Table 2 below, the minimum download speeds offered in most countries is 1 Mbps, with the exception of Belize, Dominica and Trinidad & Tobago, where speeds of 256 kbps and lower are still available. Interestingly, the price for the service plan with the lowest download speed in Guyana (1 Mbps) is over eight times that of the most expensive plan in the rest of the sample group (Belize, USD 436.05 for a 4 Mbps package).

Country Lowest d/l speed Highest d/l speed Price for
2 Mbps/USD
Speed/bps Price/USD Speed/bps Price/USD
Anguilla 1 M $ 51.16 8 M $ 138.02 $ 66.62
Antigua & Barbuda 1 M $ 54.60 2 M $ 71.53 $ 71.53
Bahamas 1 M $ 29.99 9 M $ 70.70 $ 39.99
Barbados 1 M $ 33.21 8 M $ 99.62 $ 68.97
Belize 256 k $ 51.30 4 M $ 436.05 $ 256.50
BVI 1 M $ 64.00 8 M $ 148.00 $ 84.00
Cayman Is 1 M $ 52.46 8 M $ 145.18 $ 76.86
Dominica 64 k $ 27.60 8 M $ 96.33 $ 32.76
Grenada 2 M $ 29.21 12 M $ 84.65 $ 29.21
Guyana 1 M $ 3,500.00 4.5 M $ 15,120.00 $ 6,895.00
Jamaica 1 M $ 27.97 100 M $ 142.11 $ 30.70
St. Kitts & Nevis 2 M $ 36.44 8 M $ 113.73 $ 36.44
St. Lucia 1 M $ 29.08 4.4 M $ 183.67 $ 54.84
St. Vincent & the Grenadines 1 M $ 33.44 4.4 M $ 211.21 $ 63.07
Trinidad & Tobago 256 k $ 12.48 100 M $ 126.40 $ 36.18
Turks & Caicos Is. 1 M $ 53.00 8 M $ 146.00 $ 83.00

Table 2: Monthly pricing in US Dollars for select Internet plans based on download speed (Source: ISP websites)

On the other hand, just under half of the sample group offered plans with 8 Mbps as the highest download speed. In Jamaica and Trinidad, plans with download speeds of 100 Mbps are available at prices lower than what has been specified in other countries for less than a tenth of that speed. Attention is again drawn to the exorbitant monthly fee charged in Guyana for a 4.5 Mbps connection. This price would be well beyond the reach of most domestic customers and businesses.

In all countries except Guyana and Belize, the monthly rate for a 2 Mbps Internet plan is under USD 85.00, and is even under USD 30.00 in Grenada. Again, excluding Belize and Guyana, the average monthly rate for a 2 Mbps Internet plan is approximately USD 55.30, and when weighted by population, the average monthly rate drops to around USD 38.00.

However, when compared with the monthly rates payable in developing countries, the region does not fare as favourably. The Organisation of Economic Co-operation and Development (OECD) has published the average monthly subscription prices for broadband connections with advertised download speeds below 2.5 Mbps as at September 2010, for some of its member countries. Excluding line charges, the median prices are shown in Figure 1.

Figure 1: Price for Internet plans with under 2.5 Mbps download speed in select OECD countries (Source: OECD)

Note is made that the OECD stipulated a basket of Internet plans with under 2.5 Mbps download speed, hence a broad range of plans that meet that criterion would have been accepted. However, since the term “broadband” was specified, it is unlikely that the advertised download speeds in the selected countries would be significantly lower than 2.5 Mbps.

Notwithstanding, when the average monthly rate for 2 Mbps Internet service in the Caribbean is compared with that for the OECD group, the former is considerably higher. However, the average monthly rate weighted by population is marginally better, as it is lower than the monthly rates payable in Australia and Norway, and on par with median rates in Spain

In summary, pricing for Internet service varies drastically across the region. However, more sobering is the fact that despite the strides made through liberalisation and competition, Caribbean Internet rates still might not be comparable with those charged in developed countries. As a result, we might still not be well positioned to fully harness the potential of the Internet, to create knowledge-based societies, and even to increase our international competitiveness.

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About the author

Michele Marius

Michele Marius has a wealth of experience in the telecoms and ICT space, which has been gained in the Caribbean, Southeast Asia and the South Pacific, and in the public and private sectors. She is the Editor and Publisher of ICT Pulse.

Permanent link to this article: http://www.ict-pulse.com/2011/05/snapshot-internet-speeds-and-prices-in-the-caribbean/

5 comments

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  1. Geezam

    awesome article that I’ve been dragging my feet on for months now. Glad to see someone else has put it together.

    Some interesting findings on internet prices in the Caribbean and how it compares t he rest of the world

    1. Michele Marius

      Thanks. Were the findings what you expected?

  2. Michael

    I draw attention to the comparison made to OECD countries. It might be helpful to factor in that in most OECD’s, broadband plans have “capped” downloads. It is not apparent that this is the case in the Caribbean. There are price distortions in environments where “capping” is prevalent.

    1. Michele Marius

      Excellent comment, but allow me to offer some more insight into this situation and the thoughts behind the findings presented…

      While data caps on downloads exist in some OECD countries, they does not exist in all and not for all Internet service offerings. Further, with regard to the OECD assessment, little information was provided on the methodology used, whether any pricing plans excluded, etc. It was clear that the output was median values, so it is entirely possible that they included both capped and uncapped plans in their exercise, since the only stated limit was download speed.

      Further, although price distortions do exist in environments where data caps are applied, it is difficult to factor in such distortions when multiple ISPs per country and multiple countries are being considered as per the OECD exercise, and again limited background information has been provided.

      It also important to note that the comparison of Caribbean rates with those that obtain in the some OECD countries was done to provide some context to the exercise – “how might we compare in the grand scheme of things?” It was not done to suggest that our rates should fall by “x” amount, since there were a number of variables that could not be (or were not) controlled in both the Caribbean and OECD assessments, and there a whole host of other factors, on both sides (Caribbean/OECD), that would still need to be considered.

  3. Michael

    Well clarified.

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