For even entertaining the possibility of requiring licenses for businesses providing wireless Internet “hot spots,” the Cayman Island’s “super regulator” OfReg has emerged as a candidate for a name change: OfRez — short for going “off the reservation.”

The backward-looking notion runs counter to global trends toward (and consumers’ increasing expectations of) more openness and greater access to this critical technology.

Forward-thinking cities around the globe are blanketing public spaces with WiFi signals. Private companies such as Google and Microsoft, and influential public bodies such as the European Commission and the U.S. Federal Communications Commission have been pursuing the universality of free WiFi for everyone as a public good (now considered nearly as vital as access to clean water and a decent shelter). So why did Cayman’s regulator threaten to disincentivize similar progress in our country?

In February, the utilities and commodities regulator disseminated an enforcement advisory warning that anyone providing an internet or communications technology service for a fee can be considered an “Internet Service Provider” (ISP) under the law and should be licensed as such.

In other words, if a business – say a hotel – wants to charge customers for using its wireless internet connection, it could somehow be magically transformed into an ISP. More on that in a moment.

In May, OfReg told the Compass they were aware of nine companies that were “illegally” charging customers to use their WiFi. This week the regulator’s Executive Director of ICT, Alee Fa’amoe, said that a “strict interpretation” (we would characterize it as an “expansive interpretation”) of a 2011 enforcement notice could imply that every business that provides WiFi – paid or free – could be required to be licensed (along with an accompanying fee, of course).

Casting that wide of a net would potentially snare most restaurants, coffee shops and offices (think of “guest WiFi” access) in Cayman. The very idea is preposterous, detrimental to consumers and disastrous to businesses.

In short, the proposal puts the – Dare we say it? – “Why” in “WiFi.”

Why should OfReg involve itself in any business’ decision to provide WiFi to its customers – whether it charges for the amenity or not? A coffee shop offering WiFi access to customers makes it as much an ISP as offering power outlets makes it an electrical utility. What it charges for the service, or doesn’t, is a business decision, and a relatively insignificant one at that.

As for Mr. Fa’amoe’s assertion that new licenses and fees might actually encourage entrepreneurship … simply put, it demonstrates a profound (possibly purposeful) ignorance of fundamental economic principles, and of the nature of innovation – which is about identifying unmet needs or wants and creatively addressing them.

What need could Mr. Fa’amoe’s proposal meet, other than to feed a perpetually growing bureaucracy or offer his agency even more leverage and control? If Mr. Fa’amoe honestly believes that such regulatory overreach is a recipe for economic growth, we would suggest he needs a new cookbook – or perhaps to get out of the kitchen altogether.

Kudos and applause, however, should go to another chef, in fact the chief chef of the Cayman Islands, Premier Alden McLaughlin, who has since publicly said his coalition government would never support any effort to force businesses to pay licensing fees if they choose to provide WiFi access to their customers.

OfReg’s anti-business, anti-customer and anti-progress proposal never should have been suggested in the first place. Hopefully Premier McLaughlin’s swift intervention can serve to kill this nascent telecom proposal before it breathes another breath.

Support local journalism. Subscribe to the all-access pass for the Cayman Compass.

Subscribe now