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Touché Digicel.

Digicel took to the streets today setting off car alarms with their mobile sound system, causing congestion on the sidewalks with their numbers, and triggering epileptic seizures with their bright red attire.  And they got up early to set about on their campaign of terror.

While on my way to work this morning the Gleaner caught my eye with the following headline "Reduction in call rates". I immediately thought this was in reference to the proposed cut in network termination fees (the amount that each provider pays to the other for placing a call into their respective networks).

With that thought in mind I was then greeted by a ridiculous looking, large red mouth with it's tongue stuck out - I was terrified! Standing (or perhaps hiding) behind this monstrosity was a guy wearing a Digicel shirt advertising a flat calling rate of $8.99. He didn't seem particularly thrilled with his outfit.  But his partners in crime were distributing fliers in the traffic at the stop lights, and they were bubbling with excitement.  Maybe they were just happy they didn't have to wear the silly looking cardboard mouth.

My initial mental assessment of these two bits of information (the headline, and the Digicel campaign), was that the government legislated a change in termination rates, and Digicel was out of the blocks ahead of LIME in making it a great opportunity to shape the minds of the public on this new change.

Unfortunately this was wishful thinking, at least as far as the reduction in termination rate was concerned. The rate change headline and the Digicel campaign are one and the same. In a dastardly move, Digicel today announced a flat rate calling plan for calls to all networks, with pomp and fanfare.

It's worth noting that this new rate is a effectively a reduction of only $1.01 off current Digicel to Digicel rates, and an increase of $0.99 in off peak rates.  But psychologically $8.99 looks like a bigger reduction.  For out of network calls, consumers are seeing reductions in excess of $5 and $8 (for LIME and Flow call respectively).

While I'm no fan of Digicel, I have to grudgingly give them credit for this brilliant piece of strategy. One day, that headline will be about a forced reduction to the termination rate. Digicel, realizing the inevitable, has gone on the offensive. When the change comes, and LIME reduces its cross network rates (currently at $12 for prepaid customers) there shall be no opportunity for LIME to capitalize on this from a marketing perspective. Digicel will not be caught on the back foot when that ball comes their direction.

Digicel stands to lose some money in the process, but not a lot if they play their cards right. With the government gunning for lower rates, Digicel is in a fight it can't win. Lowering rates ahead of a government mandate wins them consumer favour, and disarms the competition. Any forthcoming rate changes by LIME will merely seem like a response.  The man on the street won't know the real reasons behind the rate change, and this is why this is such a good move.

Good job on this preemptive strike Digicel. Your move LIME.
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