The Samoan telephone with the right connections
p. 50 · Read in the full issue
SUPPOSE that you were in the telephone business and were exploring new market. You have been told that, since the car phones are expensive, that you need a market with a million or so people before you could set up a profitable system. You know that most customers are businessmen calling from cars on long trips or stuck in urban traffic jams. You had a study showing that purchasers of car phones had average annual incomes of about USS3O,OOO to
Ussso,Ooo.
Would you start such a business in American Samoa, with its 35,000 people, its 15 miles of roads, and with a total, at the time, of 212 families with income over U 5525,000? Not likely.
The Director of Communications for American Samoa decided to start up a
car phone business for the American Samoa Government, though it was clear to others that the venture would be a certain money-loser for American Samoa’s telephone system. All this is in a Flash Report filed by the Inspector General of the United States Department of Interior a couple of years ago.
The proposed cellular phone system caused the Inspector General’s staff to look into previous purchases made in this field. It found that in an earlier period, fiscal years 1985 and 1986, the American Samoa Government’s Director of Com munications had made 13 purchases of communications equipment, worth U 55298,325 from a firm owned by his wife and three sons. The Director of Communications refused to buy tele phone sets which met the American
Samoa Government’s Procurement Office’s standards, and cost USsl7 each less than the family-favoured prooduct.
The Inspector General gave the audited organisation an opportunity to reply; it did not. The Inspector General extended the response time by a month; still it did not reply. Then the Inspector General sent his Flash Report indicat ing a serious level of Inspector General concern to the then Governor.
Despite the Inspector General’s criti cism the Director of Communications was not fired for conflict of interest and the cellular phone system was installed.
The phone system, however, became useful when Cyclone Ofa struck Ameri can Samoa in February last year and extensively damaged communication links. O