United States President-elect Barack Obama blames the policies of deregulation for his country's financial meltdown.

He claims that banks and oil companies have been allowed to conduct their businesses virtually unfettered by state decrees. It appears that there is some mistaken belief in self-regulation as a by-product of competition.

The reality is that where there are large amounts of money at hand, the removal or diminution of a vibrant and vigilant regulatory framework creates the climate for many ills,the most virulent of which is cartelisation.

Effect of cartelisation

In a fairly recent study (April 2005), John Conner and Robert Land, 'How High Do Cartels Raise Prices', estimate that the median cartel overcharge was 32 per cent for international cartels and 18 per cent for domestic cartels.

Now, here in Jamaica (with a population of three million), let's look at the possible effect of cartelisation. A group of companies with 70 per cent market share sells a product used daily by 70 per cent of Jamaicans and, through cartelisation, keep the product J$7 higher than if perfect competition existed.

Result: The cartel makes $5 billion per year on one product. Jamaica's GDP is approximately $250 billion. If cartelisation represents about 15 per cent of this, it amounts to a $40-billion charge against consumers annually!

Competition must be diligently regulated and, in the very active arena of mobile telephony, the regulators are culpable for not fully creating the climate that engenders real competition.

Not 'our' interest

Indeed, it must be of concern to Jamaicans that a popular talk show host constantly refers to the OUR as THEIR. A reasonable interpretation of this name could be that this host considers that the Office of Utilities Regulation (OUR) is not an organisation to see to 'our' (the Jamaican consumers) interests but rather is focused on assisting 'their' (the regulated entities) benefits.

Regrettably, many Jamaicans who interact with the OUR appear to share this conclusion.

How many of you have remained a customer of your cellular phone provider, despite disputes and dissatisfaction, because of the major inconvenience of changing your number and passing the new number on to your family, friends and business contacts?

This problem has been dealt with years ago. In many countries worldwide, you can walk into any of the mobile providers with your phone and say "I want to go on your system. Here is the number I want," and give them your existing mobile number. This would force a higher and more realistic level of competition.

The ability to 'port' (i.e., move your number from one provider to another) is nothing new. It is called mobile number portability (MNP), and is a relatively common feature of mobile communications systems worldwide. Why don't we have this in Jamaica?

Some countries that do not have this protocol in place have given the mobile companies a timeline within which the process should commence.

In some jurisdictions where MNP exists, it appears that some providers are loath to comply - perhaps because the suspect they will lose business - and effectively boycott the process by introducing a long waiting time.

During that waiting time, the customer is effectively without a phone or is compelled to pay for another service, and so is discouraged from changing.

In response, the regulators have mandated the time 'porting' shall take. In Australia, mobile 'porting' takes just three minutes!

Frustrating the customer

MNP exists in the Americas (Ecuador is to come on stream in 2009); in Asia Pacific with implementation dates as early as 2001; in Europe since 2001; Middle East and Africa since 2006.

The ultimate objective is Full Number Portability where landlines numbers can be 'ported' to mobile services and vice versa. At the moment, this only obtains in Iceland, United States and Canada.

Jamaican telecommunications was a monopoly up to April 2001. The change to a free market dramatically decreased prices and perhaps this has led to a spirit of complacency - a belief that all that is necessary is to introduce competition and sit back and watch. This is not so. We have started a process. Let's finish it and reap the full benefits.

Robert Evans is an engineer.