Why if Cable has all that money sitting they cannot build its own network?
Nassau, Bahamas – Damian Blackburn, in response to Bahamas Press’ report CBL’s new mobile provider NewCo is finding it hard to find money, is in the newspapers this morning announcing how his company has $125 million to roll out its mobile company.
The headline read “NewCo sitting on $125 million ‘Adequately Funded’ to proceed with rollout…” We must be a big nightmare for CBL and Damian Blackburn. Because, despite having the Nassau Guardian and The Tribune deep within its support system, Bahamas Press has exposed more to our vast thousands of daily nationwide and global readers than anyone else can.
1) If NewCo has the money Blackburn claims, then he should really answer the question as to why URCA and CBL are at the doors of BTC begging to use its nationwide cell tower infrastructure?
2) Why can’t Mr. Blackburn CBL’s NewCo use that money to build its own nationwide cell tower network and roll out its own devices?
3) Why is it Preferred Shareholders have declined to accept more share interest into CBL in order to raise the needed capital to build a network?
4) And why, after declining dividends for ordinary shares, preferred shareholders rushed to grab their shares out during this fiscal period?
What Damian Blackburn will not tell the public is that his company needs far more than $125 million to build a nationwide cell tower infrastructure. And what the wutless media refuses to ask is why is it necessary to use BTC’s network if you really plan to build your own?
Getting the needed capital is not the only problem with CBL’s NewCo these days.
We report yinner decide
Just to clarify, when I say using BTC infrastructure I am referring to what is commonly known in the industry as “national roaming”. As an example, in South Africa the 3rd MNO (CellC) was able to launch nationally relatively quickly because it was able to use the Vodacom (incumbent MNO) infrastructure to provide services to its customer via a “national roaming” agreement. As you can imagine South Africa is a vast country with an assortment of topography. CellC took years to build out a national network and still to this day (almost 10 year later) are still providing services to their customers in some areas using the Vodacom network.
What is very clear is that the Bahamians don’t quite understand competition in this industry and how this industry works. So let me explain. When a new entrant into the market arrives the first thing they would like to do is roll out their services ASAP. In order to do this, the regulator normally plays a vital role here and as part of the agreement they require the incumbent (BTC) to provide certain support i.e. the sharing of infrastructure. For NewCo to build its own network it will take a very long time and a lot of investment. It makes more business sense to piggy back on BTC network (OPEX) than build its own network for now (CAPEX). Thus, NewCo has a much faster time to market which means it can start making money quicker and whilst making this money it can also in parallel build out its own infrastructure. Since the Bahamas is not that large with a fairly flat topography, BTC already has towers etc. in all the islands so it would make sense for NewCo to rather share that infrastructure (at a cost obviously). This would then mean that Damian can use his $125 million in other areas of the business and thus managing his cashflow.
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