Monopoly in the telecommunications business in the CNMI is practically non-existent\u2014despite Verizon operating the only fiber optic cable\u2014because prices have remained competitive on the consumers\u2019 part, according to Verizon general manager Tony Mosley.<\/p>\n
\u201cThe governor\u2019s statements are unfounded. When he uses words [like] monopoly, those are designed to inflame a situation that really doesn\u2019t exist. When I say doesn\u2019t exist, I say that to the taxpayers because when you look across the board with all the pricing in the CNMI for the telecom, it\u2019s all pretty much competitive,\u201d said Mosley in an interview Friday in response to a recent statement by Gov. Juan N. Babauta. <\/p>\n
In justifying his position on open, competitive market, Babauta, in an Aug. 16 letter to Saipan Chamber of Commerce president Alex Sablan, said it is the government\u2019s role \u201cto protect the public interest by regulating prices, so that the monopolist does not earn excess profits to the detriment of everyone else.\u201d<\/p>\n
\u201cWhere market is not competitive as is the case with the fiber optic cable services to and from the NMI, government has a responsibility to protect the public interest,\u201d the governor said.<\/p>\n
He also denied that his administration is trying to compete with private businesses in efforts to promote investments in the local telecommunications industry.<\/p>\n
Mosley maintained that Verizon\u2019s rates are \u201cpretty competitive\u201d compared with U.S. rates, citing that local basic phone rate is $19. <\/p>\n
In the U.S., the basic rate is $25, he said.<\/p>\n
\u201cSo I don\u2019t understand the concerns about monopoly,\u201d he said, further noting that Verizon has not had any increase in basic rates in 10 years.<\/p>\n
\u201cIn a monopoly situation, we could raise the rates freely but it\u2019s impossible here because there\u2019s a commission that regulates it,\u201d he said.<\/p>\n
In terms of wireless or cellular rates, he said these are \u201cextremely competitive\u201d as there are multiple providers offering services to customers in the CNMI.<\/p>\n
The same is true with Internet services, he said.<\/p>\n
\u201cA number of Internet providers are here and people can use any of them,\u201d he said.<\/p>\n
The lack of players in the fiber optic industry, he indicated, is not Verizon\u2019s fault.<\/p>\n
\u201cInvestors chose not to. Anybody can do it. They could put up their own satellite, microwave facility. If they choose fiber optic cable, they can do it. It\u2019s been open for 10 to 15 years. In case of Verizon, we invested $14 million [for fiber optic] in 1997,\u201d he said.<\/p>\n
In his letter, Babauta cited that prices charged for cable services right now are based on the market power of a monopoly, which results in consumers paying more than they would in a competitive market.<\/p>\n
Babauta cited that the cost of a T1 line between Saipan and Guam, for instance, is $60 per mile, while the cost for the same line from Guam to Los Angeles is only $1 per mile.<\/p>\n
\u201cThis non-market-based cost for one service reduces the ability of consumers to spend for other products and services that are competitively priced,\u201d said the governor.<\/p>\n
Further, he said that not allowing competition in the industry would allow Verizon \u201cto use its monopoly to limit the capacity and the types of services its competitors can offer, restricting choices available.\u201d<\/p>\n
For his part, Mosley said the Guam-Los Angeles fiber optic line has certainly a much larger market than the CNMI.<\/p>\n
Besides, he said that Verizon also considers the rate of return on its investment. \u201cIt\u2019s like any other industry, you pay more for things depending on where you live,\u201d he said. <\/p>\n
Babauta said that encouraging new investments in telecommunications is in no way different from government efforts to encourage new investment in any other industries such as tourism and airlines.<\/p>\n
He said that the current connectivity, which includes satellite, does not offer the best cost-to-capacity ratio, adding that a new fiber optic cable would be an alternate communications route at a far more affordable price.<\/p>\n
Babauta said he is merely pushing for \u201ccompetitive ownership of the one inter-island cable, and explores other solutions to increase competitiveness, including a new investment in telecommunications connectivity.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Monopoly in the telecommunications business in the CNMI is practically non-existent\u2014despite Verizon operating the only fiber optic cable\u2014because prices have remained competitive on the consumers\u2019 part, according to Verizon general manager Tony Mosley.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-83484","post","type-post","status-publish","format-standard","hentry","category-local-news"],"_links":{"self":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/83484","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/comments?post=83484"}],"version-history":[{"count":0,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/83484\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/media?parent=83484"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/categories?post=83484"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/tags?post=83484"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}