Consolidating the Gains

BSCC was in the newspapers this week, reporting an announcement that we were doubling the speed we provided to our customers at no extra charge. What is going on?  

The BSCC Board, in reviewing its planning parameters for the 2019 – 2023 Business Plan, noted that, if current capacity growth rates (see Operational Reporting) were to continue into 2019, BSCC would see very significant revenue growth. The Board was concerned that this represented an unreasonable impost that would be borne by the people and businesses of Palau, and also would exceed revenue goals stipulated in the BSCC Act.

In examining the options, BSCC was looking for a solution that would make the biggest positive impact. A price drop sounds good, but, as I have pointed out in an earlier blog, BSCC costs are only a fraction of the total cost of products at the retail level. If BSCC was to drop its prices by 30%, it would mean a price reduction of less than 10% at retail.

The solution we came up with was to double the speed of each of our Retail Service Provider customers. We have reduced our pricing commensurately, so the unit price doesn’t go up when our customers order more capacity in future. The new pricing has been approved by Minister Obichang and is included in a revised Reference Access Offer

The decision to increase speed across the board was made in the context of a range of cooperative initiatives agreed between the members of the Telecommunications Association of Palau (TAP). TAP consists of the three retail service providers — Palau National Communications Corporation (PNCC), Palau Wifi, and Palau Telecom — and Belau Submarine Communications Corporation (BSCC). Don’t worry, this is not some cartel aiming to fleece the public. TAP is a venue for discussions on how to realise the President’s clear guiding principle for the telecoms industry in Palau: shared infrastructure, shared cost. There is plenty of competitive spirit in the retail market. 

Taken together, the TAP measures add up to a big step forward for telecoms in Palau. They are: 

  1. BSCC will effectively turn up the wick, doubling the capacity available to each RSP. 

  2. RSPs will pass on the benefits to customers through new and better products affording better value for money. 

  3. All four TAP members commit to an open interconnect regime, and have formed a technical team to implement it immediately.

  4. TAP members will network with other Pacific island nations to develop a shared satellite restoration solution to mitigate the impact of a cable break on BSCCnet (very low risk) or on the SEA-US trunk (still low risk) to which BSCCnet is connected.

 The point of most of these measures is fairly clear, but the interconnection regime is worth some more explanation. Essentially, we have agreed to a single shared transport layer that will be accessed by all the Palau RSPs on a non-discriminatory basis.

Interconnection Regime.png

Open interconnection makes the most of Palau’s world-leading, all-IP Next Generation Network. It means that, instead of interconnecting outside of Palau, our RSPs will interconnect here. There will be less latency and less jitter, meaning every product will work better.

BSCC’s vision is a telecommunications platform in Palau that is a valuable tool for its people and businesses, promoting knowledge and growth, and that will astound and delight visitors. We hope you like the progress we have made in our first year. Sulang!