New telco firm can reduce internet rates: Barker

THE entry of a major new player in the telecommunication sector will ensure there are more competitive internet rates in wholesale and retail, an official says.
Institute of National Affairs executive director Paul Barker said for many years, there had been promises of a reduction in internet prices.
“Some new players like Vodafone will no doubt wish to focus on more accessible centres first, making little initial difference to those in rural centres, while Telstra will also no doubt wish to secure some initial return on its (or the Australian government’s) capital outlay for acquiring Digicel,” he said.
“The merger of Telikom and bmobile and the investment by Nasfund (National Superannuation Fund) in this business should enhance its capacity and competitiveness.
“This leaves DataCo PNG Ltd as the wholesale provider a bit on a limb with its domestic cable network and potentially shifting relationship with the Coral Sea cable.
“It will be under increased pressure to offer more competitive rates, and will need to develop its model on maximising usage with lower rates, to be able to service its debts and manage a viable and competitive service.”
Barker said there had been promises made that the internet price would be decreased.
“They have fallen, both for those connected on the cable network and those using mobile phone connections as new investments in international and domestic fibre optic cables have been connected and new satellite connection and extension to the 4G network have been introduced, with some competition between service providers,” Barker said.
“Bandwidth has increased, although there remains major bottlenecks, such as the broken submarine cables and at times land cables connecting Lae, other outages, plus the limited competition to many centres and rural areas, and the business model of Digicel with its need to service major overseas debt, notably for its Kumul domestic undersea cable, which has undermined their capacity or inclination to fully pass on the lower costs with greater capacity of its international links.”