The debate about the model that should be adopted for EASSy often fails to look at the reasons why the companies that are signatories to the EASSy Memorandum of Understanding (MoU) are strongly against what is termed as open access. Is it because they do not want customers to enjoy lower prices? Is it because they are not interested in taking services to the furthest corners of the countries they operate in? Or is it simply because they have greed and therefore their eyes are glued on super-profits the cable promises to deliver? The companies have made their case for a club consortium, arguing that this is a private-sector-led project that should be owned by them and run the way it best suits them. Some have argued that they look at EASSy not as a business to make money but an investment to help them lower their operational costs.

What no one has openly said is that the MoU signatories want closed access to EASSy because that will form a key basis of their comparative strategy in dealing with competition. Allowing open access to this cable would increase competition in service provision yet competition in an industry continually works to drive down the rate of return on invested capital. By making it hard for future competitors to access EASSy, the MoU signatories are assuring their competitive strategy, which should translate into healthier performance in the future. The goal of a competitive strategy for a business unit in an industry, as experts would point out, is to find a position where the company can best defend itself against competitive forces or where it can influence them in its favour.

In his book Competitive Strategy, Michael E. Porter a Harvard professor explores the major barriers to entry of new players into an industry, noting that existing players seek to assure their competitive advantage by deepening the barriers for potential entrants (See Michael E. Porter, Competitive Strategy. New York: Free Press, 2004). It is hence evident that the various barriers to entry in an industry, including existing operators’ economies of scale, the big capital requirements newcomers need, lack of access to distribution channels, and the cost advantages independent of scale which established firms have over potential entrants, would all be assured for the MoU signatories in the case of a closed access EASSy.

Though the MoU signatories are reluctant to say this, the situation is rather plain. An issue to ponder then would be how an open access EASSy would possibly impact positively on the bottom lines of the firms that are investing in this cable.