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Digicel expands reach, technology to support continued growth

Caribbean carrier Digicel has been snapping up properties and is introducing dual-technology roaming for its customers as it expands its network reach and potential revenue streams.
The carrier is coming up on its sixth birthday in April, after launching its first and flagship market in Jamaica in 2000. Its coverage now reaches 22 markets after several notable acquisitions late last year.
In October, it closed on its purchase of El Salvadoran operator Digicel Holdings Ltd., which coincidentally shared a name with the larger Caribbean carrier. As part of the acquisition, Digicel acquired a spectrum license in Guatemala. In November, Digicel bought U Mobile, an operator in Guyana, which marked its entrance into the Central American mobile market.
Digicel’s customer base reflects the demands of the Caribbean market, according to CFO Lawrence Hickey. The base is about 93-percent prepaid, with the remaining customers postpaid.
The carrier has more than 4 million customers and saw customer growth of more than 100 percent year-over-year between 2005 and 2006. Although some questioned the carrier’s launch in Haiti, Hickey said, the market has been particularly successful. Digicel rolled out service in Haiti in May 2006, and reached 1 million customers just eight months later, on the small island nation with a population of about 8.5 million people.

WiMAX for broadband
Digicel also offers WiMAX technology as a broadband offering in addition to wireless voice, after a trial in the Cayman Islands and a launch in Jamaica early last year.
Hickey added that although in its early days Digicel could have been severely impacted by a hurricane wiping out one or two of its then-few markets, the group is now large enough to sustain itself if such a storm happened.

CDMA roaming
Last week, Digicel announced that it was introducing CDMA roaming, even though it operates a GSM network throughout the Caribbean. Network equipment company Huawei Technologies Co. Ltd. was awarded the contract to build the CDMA 2000 1x EV-DO network to introduce CDMA roaming in five markets: Jamaica, Bermuda, Aruba, the Cayman Islands and Barbados.
The carrier had previously announced a three-year preferred roaming agreement with Vodafone Group plc, and also has similar arrangements with T-Mobile USA Inc. and AT&T Inc.’s wireless division; Digicel acquired Cingular’s operations in the Caribbean in mid-2005.
In total, Digicel has 260 roaming partners in 140 countries.
Hickey noted that due to the Caribbean’s popularity as a destination for tourists, offering them CDMA technology as a roaming option is an attractive way to grow the company.
The company has much of its initial market investments behind it, Hickey said.
Hickey also said he expects to see additional moves in Central America by the company over the next couple of years, and more growth in existing markets such as Haiti.
“We’re focusing now on growing subscribers, growing ARPU, growing revenues and then adding new revenues and subscriber streams from new operations,” Hickey said. “It’s all going in the right direction for the right reasons.”

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