SpeedNet Communications, owner of the SMART brand, and Belize Telemedia Limited, owner of the Digicell brand, today fired off press releases in their latest round of corporate war over agreements that the companies had signed back in 2004 for the sale of services to SMART from BTL.
SpeedNet, which Prime Minister Dean Barrow has said is owned and controlled by British billionaire, Michael Ashcroft, claimed that on Friday, November 13, the government-controlled BTL served notice that it would terminate the circuits that carry its outgoing international voice and roaming service as of Friday, November 20.
“The effect of terminating these circuits without reasonable notice and without first negotiating and putting in place a viable alternative service will mean the loss of international voice and roaming service to over 90,000 customers,” said SpeedNet.
Here’s the backdrop to the latest development: International calls through SMART are generally cheaper than those made from the network of the dominant telecommunications provider – Belize Telemedia Limited (BTL). It sounds like an illogical scenario—one that BTL says has arisen because of sweetheart deals signed between the two companies when they were under the control of the same investors.
Belize has no anti-trust legislation to curb such agreements; however, after the government took over BTL in August, the newly appointed BTL board began to publicly take objection to a string of four commercial agreements they deem have put BTL at a disadvantage by causing it to subsidize its competitor.
In effect, that meant that there was no real competition, but since the government takeover, a different picture has been painted. Observers and consumers see two rivals in an all-out corporate war with heavily political dimensions, since SMART is owned by the family of Leader of the Opposition, People’s United Party, the Briceños, and a string of companies for the party’s chief financier, British billionaire Michael Ashcroft, who hold majority interest in SMART.
BTL, on the other hand, is currently controlled by the government, under the administration of the United Democratic Party.
BTL’s chairman, Net Vasquez, confirmed to Amandala Wednesday night that BTL does intend to pull the plug on SMART’s international outgoing and roaming services this Friday because the company (BTL) is losing money as a consequence of that arrangement.
We were curious just how much BTL is losing. When we pitched that question to Vasquez, his response was that he did not have that figure on hand.
While SMART has contended that the notice period of 1 week it got for termination of outgoing international calls and roaming services was way too short, Vasquez contended that SMART can afford to make other arrangements.
BTL has also served SMART notice regarding the tower lease agreement, he added. BTL’s government-appointed board has contended that the rates are way too low; however, SMART has argued that given the amount of business it does with BTL and what it pays for similar services from other companies in Belize, the rate is fair.
BTL said that the company continues to subsidize SMART “through discriminatory and unfair pricing agreements for the use of BTL’s infrastructure.”
The agreements, claimed BTL, was signed when Ashcroft had financial interest in both companies, as a plan to “cream off profits” from BTL.
“BTL will not continue to subsidize SMART and its foreign interest,” BTL’s release contends. “…we have made it expressly clear that we are willing to cooperate with them according to international standards of cooperation, which so far they have responded to with only rejection and threats.”
BTL concluded that if SpeedNet customers lose service, it’s simply SMART’s act of “self-sabotage” to smear BTL.
Today, SpeedNet said that it has called on the PUC to intervene by instructing Telemedia to refrain from terminating the circuits until alternative arrangements have been put in place.
The company said customers would also be able to call in complaints at a toll free number (to be announced later.)