Free Wi-Fi: the three sides of the debate

The Sint Maarten Government is considering rolling out free Wi-Fi. The incumbent telecoms provider and regulator have stated their positions on the matter. We also add our two cents…

 

In recent years, several Caribbean countries have expressed a desire to increase Internet access and use, with the expectation of improving digital literacy of their citizens, along with their country’s innovativeness and global competitiveness.  One of the initiatives many countries have been eager to implement is increasing the availability of public (free to use) Wi-Fi. Some countries even set the goal of having 100% Wi-Fi coverage, through which to focus their efforts.

It would thus not be any surprise that the topic was raised at the recently concluded Caribbean Association of National Telecommunications Organisations (CANTO) annual Conference and Trade Exhibition, which was held in the Dominican Republic. Through a press release, the Minister for Tourism, Economic Affairs, Transport and Telecommunications in Saint Maarten, Melissa Arrindell-Doncher, expressed an eagerness “to explore possibilities of establishing WiFi solutions for cruise visitors, in collaboration with local providers” (Source: The Daily Herald).

Sint Maarten is part of the Dutch Caribbean, and shares the island it inhabits with Saint Martin, a French colony. Similar to most Caribbean countries, tourism accounts for around 80% of Sint Maarten’s economy, and in 2015, it received around 1.9 million cruise ship passengers (Source:  The Daily Herald), in addition to other visitors, which based on previous years is estimated at at least 500,000 a year (Source: CIA World Factbook). In light of tourism’s importance to the Sint Maarten economy, it thus seems logical for the Minister for Tourism to want to protect it, and even try to add value to the visitor experience.

The incumbent provider’s view

Although the Minister had indicated that she had only had some highly preliminary discussions, Sint Maarten’s incumbent telecommunications carrier, Telem, seemed concerned that her statements were gaining too much traction in the media. TelEm Group Chief Executive Officer, Kendall Dupersoy, was thus quick to respond and appeal for caution:

I am all for making telecommunication services affordable for TelEm Group customers, however, I cannot see how we can benefit by offering free WiFi “spots” to the millions of visitors who come to the island each year, who are currently paying for this service..

… Government should not continue to give away services for free that are still being charged for in other countries and by other carriers, since TelEm Group has the very large expense of bringing internet to the island, and must be able to monetize this while providing cost-effective service to the community, business and visitors to the island…

…If data revenues are also now put at risk by giving away data for free, then any hope of keeping our cost to customers low, offering affordable rates and continuing with programmes such as free fibre telecommunication services for schools and organizations, goes out the door….

(Source: The Daily Herald)

The regulator’s view

Quick on the heels of Telem’s statements, the Bureau Telecommunication and Post, the telecommunications regulator in Sint Maarten, threw in their two cents. Essentially, its position was that according to the United Nations (UN), Internet access has become a basic right that need to be protected and fostered:

.. the statement above from the UN indicates how internet is now being looked at globally. Internet in this day and age must be seen as public utility – just like electricity and water – that should be available & accessible to everyone. Recognizing the need and importance of internet services for our citizens and visitors, to connect to the World Wide Web, should be of the highest priority in every discussion.

(Source: Saint Martin News Network)

The regulator was also quick to point out that free public WIFI is common practice:

It’s being used for education purposes and utilized by millions of students, it’s an essential tool to bridge the digital divide in country, whereby less fortunate people can still visit hotspots to get connected. We’ve seen that it’s being used for disaster relief, whereby residents after natural disaster, still have places to connect to the internet to communicate with family and friends, and last but not least, free public WIFI is the most essential tool nowadays for Tourism, Country, City, and island promotion. Free WIFI zones gives your town a modern look and demonstrates forward thinking

(Source: Saint Martin News Network)

Our view

The above sets out in brief a contention that needs to be resolved in Sint Maarten. Luckily, the incumbent telecommunications carrier seems eager to engage the government on the matter, in the hope of trying to protect its interest, whilst offering some options that could be considered. On the other hand, the regulator is advocating on behalf of the national interest. In addition enhancing Sint Maarten’s tourism product, it argues that free Wi-Fi would have far reaching benefit in education, emergency relief, and could even increase country attractiveness among tourists and the business community alike.

Although these are very early days in the discussions that ought to occur, below are some thoughts, which all parties, both in Sint Maarten, and in the wider Caribbean that might be broaching this issue, should consider,

First, the loss of revenues from introducing free Wi-Fi in high traffic areas, where people have had to pay for service, would be a real challenge to Telem. Further, similar to most major carriers across the region, its revenue base has been eroded considerably over the past several years, thanks to, among other things, increased local competition, lower rates, and the impact of global competition from  over-the top services, such as Skype, WhatsApp, Viber, which compete directly with its voice services.

Second, the UN has indeed been promoting the position that Internet access is a basic right: and it will become increasingly important as countries seek to achieve the Sustainable Development Goals, as it can be a crucial tool and driver to realise the targets set. Having said this, and in many developing countries, especially Small Island Developing States, limited resources (particularly money) are available. It thus becomes a matter of determining priorities, thereafter assigning what meager funds are available, which inevitably means that some things get left behind.

Although many governments might consider increasing access to Internet services a priority, it could find itself way down the totem pole, when matters related to improving health care, education, access to potable water and electricity are also being considered. As a result, whilst countries might support the UN’s view that Internet access being a basic right, they may not be in a position implement the requisite measures at home consistent with that view.

Third, The Sint Maarten regulator is not wrong for trying to foster the economic and social benefits that could result when from more wider access to and availability of free Wi-Fi. Most regulators must not only consider the technical requirements for the delivery of services, but also national interests.

Fourth, Whilst there is an expectation that the ’free Wi-Fi’ service will be free for end-users, it does not mean that the service itself can (or even should) be delivered for free. There is a cost for its provision, and in light of Sint Maarten’s significant tourist numbers, providing a quality service will demand considerable infrastructure, which must be maintained. Hence, similar to street lighting, for which local government get billed, although the facility is installed, and maintained by electricity companies, Sint Maarten (and other Caribbean governments) may need to be prepared to engage in similar arrangements in order to provide free Internet services.

Fifth and finally, although countries might bristle at having to pay for ‘free Wi-Fi’, funds may be available that could be applied to such initiatives: the Universal Access/Universal Service (UAS) Fund for telecoms. Thanks to the regulatory policies adopted, many Caribbean countries made provision for such a mechanism, which could pay for, or subsidise, the delivery of services.

However, one of the challenges countries that had started to collect funds have experienced, is that – for a broad range of reasons – they could not roll out programmes that could use the funds. It therefore means that some countries have already have in hand significant sums, which would be applied to a free Wi-Fi programme. However, once again, there could be a battle of priorities, depending on programmes that are already be financed and their importance and impact on the society at large.

 

Image credit:  Chris Oakley (flickr)

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