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Telecommunication services provider Flow Jamaica is reshaping its retail network and investing in network upgrades to protect its position in the market.
It is estimated that more than a million homes in Jamaica are supplied with fixed line and broadband connections, and Flow says it provides service to about three-quarters of them. The company wants to hold on to those customers as it hardens and expands its infrastructure.
Going head-to-head with rival Digicel Jamaica, which has a bigger mobile subscriber base, Flow has been rolling out products such as Yaad and Road, along with promotions that support even grocery purchases to the tune of $20,000, while growing its customer base along the way.
Flow General Manager and country head Stephen Price estimates that at the advent of the COVID-19 pandemic, Flow’s fibre-optic coverage extended to about 350,000 homes in Jamaica, but that number has more than doubled since then.
In an interview with the Financial Gleaner, Price said the growth resulted from an aggressive campaign over the last five years to ‘overbuild’ existing infrastructure as well as connect new homes to the network. Overbuilding has the effect of cancelling old infrastructure while building out faster, more reliable technology.
“If Jamaica has 1.1 million homes, we know we’re past 760,000 with fibre-fast technology,” Price said.
The company later provided more precise figures, saying its mobile customer base now stands at 1,217,400, while total fixed line and broadband customers number 772,400.
“I think right now is the best moment for us to say, ‘Okay, let’s make sure that we’re not neglecting the current base. Let’s make sure that we are, at all times, trying to really show our appreciation for the length and the tenure of customers that have been with us for so long’,” Price said.
Flow Jamaica is on a drive to shut down its legacy systems. The day is fast approaching when the copper wire system will be fully retired, Price said.
“That doesn’t mean they have all been migrated as yet,” said Price.
There are around 20,000 customers still connected to the legacy system, some of whom are reluctant to make the transition from the copper network to faster technology. However, Price said their migration is mandatory.
“We’re in the process of overbuilding and once we’ve done that, we start the migration process,” he said.
“I think we’re at a stage now where the technology is moving at a particular pace … . We can’t necessarily allow that (legacy holdout customers) to hold us back or hold the customer base back,” he added.
Operating two networks would be impractical, the company noted.
“That would be ludicrous from any developing country perspective, in terms of scale,” said Price, adding that the entire copper network would be shut down by the end of the year.
At the heart of the operation of the copper network are the old telephone exchanges that are 50 to 60 years old and notorious for the power they consume, he explained.
“With those kinds of technology, these (exchanges) are the power hogs from a time when people didn’t really consider power conservation as a thing,” Price said.
Meanwhile, Flow Jamaica spent just short of US$1 million on renovations to its corporate offices at Carlton Crescent in Kingston, as well as its flagship retail store at 47 Half- Way Tree Road and another store in Mandeville, Manchester.
The spend on the company’s stores comes alongside a review of the entire retail network.
“We have a lot more to do in terms of our own stores, and the partner stores out there across the island. We’re doing the numbers, doing the business cases, just to make sure that we get to the right number … we’re continuing to tweak the model,” Price told the Financial Gleaner.
Another 37 stores are to be revamped.
“I think we’ll try to get those done over the next two and a half years,” he said.
The telecoms is investing about US$50 million in upgrades to the network, inclusive of mobile network expansion to improve coverage. Presently, Flow’s mobile network coverage extends across 95 per cent of Jamaica, according to information provided by the company.
To facilitate the expansion, Flow is in the process of acquiring a licence for a 600 MHz spectrum from the Spectrum Management Authority in order to add capacity to its mobile network and improve data service.
The telecoms uses 850MHz and 1900MHz spectrum for its 2G, or GSM, network, but says it is in the final phases of retiring the 2G service. Its 4G/LTE service, which is better for faster data transfer and is generally used in dense urban areas, operates at the 700MHz band of the radio spectrum.
“That (600MHz expansion) will provide some additional capacity, especially the LTE space, for us to continue to grow the network,” Price said.
A decade ago, Flow Jamaica held a 16 per cent share of the mobile market; now the company has a 38-39 per cent market share, the country manager said.
“We have really been on a great drive to build our base and continue to really fight,” he said.
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