By Sue-Ann Wayow
THE increased use of internets apps such as WhatsApp and Zoom especially during the Covid-19 pandemic is one of the reasons why revenue for the Telecommunications Services of Trinidad & Tobago (TSTT) has decreased and as a result, the company will be again restructuring.
TSTT in a press release on Monday stated that during the past financial year which ended on March 31 2021, its revenue fell by $453 million, – 18% less than the previous year.
It stated that it will be meeting with the relevant unions to discuss plans going forward as, like other companies, it has been negatively affected by the pandemic.
TSTT stated, “This, coupled with increased consumer adoption of digital applications like WhatsApp and communications platforms like Zoom, has seen the steady erosion of traditional voice revenue. In Trinidad and Tobago, fixed voiced calling in terms of minutes and calls have declined by 50% over the past ten years and mobile voice calling has declined by 20% in the same period according to the annual TATT (Telecommunication Authority of Trinidad and Tobago) market reports.”
In addition, the legacy costs associated with redundant technology in its existing operating structure, continue to have a crippling impact on TSTT’s business and its results, TSTT stated.
It stated, “This material decline was partly due to issues related to the Covid-19 pandemic and a combination of economic and technological factors both unique to the Trinidad and Tobago market as a direct result of the global digital revolution in the telecommunications industry. Regionally and internationally, networks are under pressure: internet traffic is growing exponentially, but the price per gigabyte is declining almost as rapidly, and the result is a downward pressure on revenue growth and margins.”
TSTT has had to focus on aggressively managing its expenses over the past year as these trends intensified, more so than its competitors who have global cost-economies of scale. The company introduced several initiatives, the most significant of which was a cost-cutting drive that included the containment of non-personnel expenses, TSTT stated.
Its chief executive officer Lisa Agard said, “Given our current challenges, TSTT considers that it must now urgently restructure to remain competitive. We must move to an operating model that is more in line with industry benchmarks, and which gives us the ability to adapt and evolve with the constant developments in technology. This is our only option if we are to return to profitability.
“Simply put, there is a new normal in our industry and TSTT considers that it has no choice but to adapt to it. Therefore, in keeping with the terms of our collective agreements, the employee representative unions have been invited to discuss the company’s future. We look forward to meeting with them in the coming weeks to see how best we can work together to ensure our collective success.”
In his review of the company’s performance of the financial year, chairman Sean Roach said, “We must immediately look at the implementation of innovative financial and technological solutions to enable the Group to build on the successes achieved during the last financial year. TSTT must become increasingly agile for us to maintain a competitive edge in the constantly changing world of digital telecommunications. Our plans for a more sustainable, competitive, and customer-focused future are currently being researched and a new strategy and direction is being designed for discussion with our key stakeholders.”
TSTT stated that it will enter the upcoming discussions in good faith and with the hope that all parties will focus on achieving sustainable revenue-generating initiatives, while also focusing on cutting operational expenses.
“The company is ready to put forward what it believes to be a reasonable and workable operating model to best position it to survive during the remaining impacts of the pandemic and the new environment of continuous technological change that defines the broadband revenue business model. TSTT looks forward to engaging the representative unions to find common ground on the way forward,” TSTT stated.
Been saying for years that TSTT should be a Facilitator.
Covid is not the reason for decline in revenues . Technology is the reason for the decline in TSTT’s revenues and will continue to be . The World has changed and we must all change to remain relevant .