New ISP May Crank Up Bermudian Internet Competition

by Mike Godfrey, Tax-News.com, New York

09 July 2002

Yesterday saw the launch of a sixth Internet Service Provider in Bermuda, when Fort Knox Bermuda introduced FKBnet, although two of them, TeleBermuda International and Cable & Wireless, who have international telephony licenses, are restricted to serving the business market only. Fort Knox, whose primary business is data storage and protection and disaster recovery, received its license in February.

The other three general ISPs are Bermuda Computer Services' Transact, North Rock and Logic. Although Transact, which was launched in February, undercut the two existing providers with its basic access package, there hasn't been any general move yet towards lower prices, despite continual complaints from users about high prices. Transact’s residential packages average $1.36 per hour, while North Rock charges an average $1.80 per hour and Logic, $1.89 per hour.

At the press conference last week to announce the FKBnet service, Telecommunications and E-Commerce Minister Renee Webb said that the market for ISPs was now saturated, a claim which the Royal Gazette said seems absurd given the lack of price competition. The Government says that 67% of households now have Internet access, and expects that figure to rise to 80% within two to three years.

Troy Symonds, Fort Knox’s chief executive officer, expects his company’s presence to shake up the sector. “I think eventually there will be a price war,” Mr. Symonds said. Ms Webb also said she was confident FKBnet would increase the service and lower costs for Internet access over “the next several months.”

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