Communications Fiji Limited (CFL) remains optimistic in its investment in Unwired Fiji, a private Fijian registered company and the first local provider of wireless broadband internet services in the country.
CFL holds 46 per cent shareholding in Unwired Fiji, which had been incurring substantial losses for the first three years of its operations.
Figures released in CFL’s 2007 annual report revealed Unwired Fiji recorded net losses of $246,258 for the end of the 2007 financial year, a substantial reduction in losses from $383,669 recorded in 2006.
However, CFL managing director William Parkinson told FijiLive Business the company is now in a good spot with the internet service provider (ISP) and it would only take another three years before it would begin to see the real benefits of that investment.
“The nature of Unwired and anybody entering into the telecom business is that it takes a while to get up. So because you’re adding subscribers effectively and users each year, your revenue will grow each year,” Parkinson said.
“You will have to get it to a critical point where you are making profit and from then, the company tends to grow very rapidly. We’ve had to carry quite substantial losses on Unwired for the first three years of operations,” he said.
“It’s also a new business and it was working in a fairly difficult regulated environment for quite some time so that didn’t help. But now we’re in a good spot with Unwired and with the deregulation of the market, the company (Unwired) is stabilised given that is has now got a large number of users,” he added.
“So we’re on a stage now where Unwired will start to contribute significantly, we hope certainly from this year, towards CFL’s bottom line,” Parkinson said.
He added CFL had also taken a very conservative approach towards its losses from Unwired.
“We haven’t taken up any tax provision for taxed credits from the losses in Unwired. So, as soon as we get to a stage where we can show at least a breakeven or a steady profit, then we can bring back those tax credits in our books and that will be quite a substantial amount.”
