CANTO WEEKLY NEWSLETTER – BNAMERICAS

CANTO WEEKLY NEWSLETTER – BNAMERICAS

Thursday, June 14, 2018

ICT: The week in 10 stories – Regional
CLT18: Google-Cuba talks to improve positioning of internet content – Cuba
CLT18: ICT key to Cuba surviving US embargo – Cuba
Mexico says Red Compartida has its first clients – Cuba, Mexico
Latin America’s missed opportunity: The digital paperwork gap – Regional

 

ICT: The week in 10 stories – Regional

COLOMBIA
Telecoms ministry Mintic has requested the withdrawal of a bill that aims to merge the telecoms and TV regulators due to fears that financing for public TV would drop as subsidies would be spread among the two sectors.
PERU
Movistar and Claro established themselves as leaders in prepaid number portability in May while competitors Entel and Bitel led the postpaid ranks.
The transport and communications ministry MTC, through telecommunications fund Fitel, will invest US$27mn in deploying broadband in Moquegua department.
CHILE
Google’s Curie submarine cable connecting Chile and the US will start being laid out on the seabed in January and is expected to be ready for service in August next year.
PUERTO RICO
T-Mobile expects to deploy its LTE Extended Range network in Puerto Rico later this year. It wants to take the opportunity and build a faster network in the wake of the damage caused by Hurricane Maria in 2017.
MEXICO
Telcos should be prepared to defend Mexico’s 2013 telecom reform following the July 1 presidential election, an SCT official told an industry forum on Wednesday.
Mexico’s telecoms giant América Móvil announced on Tuesday it will expand its footprint in the US market with the launch of a new subsidiary called Claro Enterprise Solutions.
PANAMA
Jamaica-based telecoms operator Digicel launched 4.5G connectivity in Panama, offering speeds of up to 30Mbps in Panama City and 180Mbps in the rest of the country.
PARAGUAY
President-elect Mario Abdo Benítez will discuss connectivity issues with Brazil’s President Michel Temer in a meeting scheduled for June 11, in Brasília.
BRAZIL
Chinese telecoms giant Huawei will give the Brazilian cell phones market a new shot four years after giving up on selling phones in Brazil because of tax and competitive issues.
CLT18: Google-Cuba talks to improve positioning of internet content – Cuba

Recent talks between Google and the Cuban government are designed to improve the positioning of Cuban content on the internet and are not related to building communications infrastructure in the country, Cuba’s deputy communications minister, Jorge Luis Perdomo Di-Lella, told BNamericas.
In April last year, Google confirmed it would start an internet caching service, operating as the first foreign ISP in Cuba.
This will help Cubans to have faster access to YouTube and other popular web content. Cuban state telco Etecsa is using the Google Global Cache (GGC) to cache YouTube and other high-bandwidth content locally in order to have it delivered faster.
“The caching project is operational,” Perdomo Di-Lella said, speaking on the sidelines of the Latin American communications conference (CLT18), being held in Varadero, Cuba this week.
The official rejected speculation that the Cuban government was discussing potential telecommunications infrastructure investment with the internet giant.
“It’s not about infrastructure; what is under consideration is a project to collaborate on better positioning Cuban content on the internet, so it gets more views on Google. We’re working together on that project,” he said.
Last week, US senator Jeff Flake and former Google CEO Eric Schmidt met with Cuban President Miguel Díaz-Canel in Habana, sparking speculation that Google might be considering investment in connectivity infrastructure.
Cuba’s main international connectivity comes from the Alba-1 submarine cable, which runs from Venezuela to Cuba and Jamaica. It was built by Venezuela-Cuba joint venture Telecomunicaciones Gran Caribe (TGC) and activated by Telefónica.
In February this year, satellite company SES announced it would provide service to the island giving Cuba much-needed communications redundancy.
CLT18: ICT key to Cuba surviving US embargo – Cuba

The use of ICT will be key for Cuba’s future social and economic development and overcoming the economic restrictions of the 60-year US embargo, communications minister Maimir Mesa Ramos said on Tuesday.
In a keynote speech at the inauguration of the 6th Latin American Communications Congress (CLT18), Mesa said that Cuba’s economic model was alive and well and that ICT was key for growth and for meeting the United Nations Sustainable Development Goals 2030.
“Despite the 60-year embargo, our economic model still stands and ICT is going to play an important role in Cuban society from now until 2030,” Mesa said.
In February last year, Cuba’s government approved public policy that makes digitization a top priority. The program focuses on prioritizing the improvement of connectivity in areas of high economic activity like tourist resort resorts and in the use of ICT in public and educational institutions. A strong focus will be put on scientific research, agriculture, healthcare and culture.
“We need to strengthen our efforts to reduce the digital divide between developed and developing countries with digital inclusion, access and use of ICT,” the minister said.
Referring to cyber security, in what could be interpreted as a thinly veiled warning to the US, Mesa said that ICT should not be used for “cyber intervention.”
In February, Cuba condemned an Internet Task Force formed by the US Department of State (DOS) to examine the connectivity challenges on the island as an attempt to meddle in the affairs of the nation with Havana slamming any “attempt to manipulate the internet for political or subversive means.”
Mesa said, “Cuba believes that ICT should be used for economic and social development, peace, knowledge and eradicating poverty.”
The minister underscored the country’s progressiveness in areas such as gender equality, saying that 40% of Cuba’s workforce in ICT are women.
CONNECTIVITY
Cuba still has one of the lowest levels of connectivity in the region.
According to state telecoms company Etecsa, some 4.5mn Cubans have internet access. A total of 1.7mn Cubans use the Nauta mobile internet card system and 36,928 use the Nauta Hogar home internet service. Some 2.4mn Cubans use the state e-mail service.
The country has been developing a digital strategy hinging on the rollout of public Wi-fi hotspots, which now number 1,874. Etecsa has said that 3G technology will be available this year.
Cuba’s deputy communications minister Jorge Luis Perdomo Di-Lella, told BNamericas that the idea was to prioritize higher speed connectivity in areas of high economic activity.
“Some places will have 2G, others will have 3G and others 4G,” Perdomo Di-Lella said.
The country has said it aims to have 50% of homes connected to the internet and 60% of people with mobile broadband by 2020.
The thawing of relations between the US and Cuba was started by Barack Obama, whose official visit in 2016 led to a series of international roaming agreements between Etecsa and major US telecom carriers, plus commitments from prominent internet companies like Google, Airbnb and Netflix to activate services in the island nation.
Donald Trump’s administration, on the other hand, has gone back to an approach of applying pressure on Cuba, citing its human rights record.
For more on Etecsa, see BNamericas’ Operator Series.
Mexico says Red Compartida has its first clients – Cuba, Mexico

By Patrick Nixon from Varadero, Cuba, and Tomás Sarmiento in Mexico City
The first three clients of Mexico’s controversial Red Compartida wholesale mobile network project are “weeks” from hitting the market and proving naysayers wrong, a high-ranking communications official told BNamericas.
The network – run by the Altán Redes group over the 700MHz band and two strands of fiber optics cable granted by the state – was launched in March covering over 32% of the country’s population, with a goal of reaching 92% by 2024. It is designed to sell wholesale capacity to telecoms companies and increase coverage in Latin America’s second largest country.
The project, the first of its type in Latin America, has been criticized by some in the industry arguing that the prized 700MHz spectrum should have been made available to carriers to increase coverage and services. Others have said that, with limited initial coverage, it is still not a commercially interesting partner.
Large traditional carriers such as América Móvil and Telefónica have recently said that they don’t see the need to use the spectrum offered by Red Compartida, while some mobile virtual network operators have cited network exclusivity contracts such as the one that Virgin Mobile holds with Telefónica, which prevent them from reaching out to the new provider.
Nevertheless, communications and transport ministry SCT’s undersecretary of communications Edgar Olvera (pictured) said the network has its first clients lined up.
“Red Compartida has filed with the [regulator] IFT three contracts with operators,” he told BNamericas on the sidelines of the regional telecoms conference CLT18 being held in Varadero, Cuba. “Those first three clients are working to come forward in the next few weeks.”
While the companies have so far chosen not to publicize the contracts, Olvera said the clients plan to offer wireless internet to the home, mobile data and text services.
The head of investment and development at Mexico’s telecom investment promotion agency Promtel, Elizabeth Peña, told BNamericas on Thursday that the first client landed by Altán Redes is a Mexican investment company that plans to provide high-speed internet, and that negotiations began two years ago at the Mobile World Congress.
Altán executives have dismissed the notion of looking into the retail telecommunications market.
Olvera said that market studies conducted by the government before tendering the project revealed that the network’s operator could reach profitability with a share of 12% to 15% – and without any carrier as a client.
“The first thing to understand is that Red Compartida is not the carriers’ competitor – their competitors will be those taking advantage of Red Compartida,” Olvera said.
Yet dominant player América Móvil could eventually find itself needing to supplement its capacity by leasing Red Compartida spectrum, whether to overcome periods of network saturation or in places where its coverage relies on less advanced 2G technology. América Móvil is deploying 4.5G coverage in Mexico and in the rest of Latin America, even as it competes in 4G with Telefónica and AT&T.
COVERAGE OBLIGATIONS
Olvera stressed that the network has coverage obligations embedded in the contract with the state. They include connecting 15 locations with under 10,000 residents for every 100 locations with over 10,000 residents.
He said the network’s initial deployment, which included about 2,500 base stations, covers the country’s three largest and most profitable markets – Mexico City, Guadalajara and Monterrey – and that the project is ahead of schedule to reach its next contractual commitment of 50% of the population by January 2020.
“The state makes a contribution, but it’s not a partner or a shareholder. It simply made the 700Mhz band available, as well as a pair of fiber optics strands, and left the investor at liberty to deploy capital, to operate and recover its investment,” he said. “What does it get in return? Population coverage with certain quality levels and a deployment schedule.”
Latin America’s missed opportunity: The digital paperwork gap – Regional

It can take a Bolivian citizen an average of over 11 hours over several visits to public offices to solve something as simple as renewing an ID card, and 89% of Latin America’s paperwork still requires going in person to a government facility, opening the door to graft and productivity losses, according to a study by the Inter-American Development Bank (IDB).
The study showed that, on average, a Latin American spends 5.4 hours handling official procedures with the government such as paying taxes, getting a passport or registering for health benefits, and that some paperwork is so difficult that 29% of people in the region (some 90mn inhabitants) admitted to paying a bribe at some point to complete the process.
Chileans spend the least time waiting in line for a rubber stamp (2.2 hours), followed by Costa Ricans (3.1 hours) while Brazilians take around 5.5 hours, Mexicans 6.9 hours and Peruvians over one working day (8.6 hours). Bolivians take the longest at 11.3 hours. And those hours can be split into several visits, as only 51% of all in-person procedures can usually be solved in one go, the study added.
The study casts a harsh light on the gap waiting to be filled by easier, cheaper and faster digital procedures, taking advantage of increasing internet penetration in the region as well as from emerging technologies such as blockchain-enabled land registries, the study said, citing a case from Georgia.
The development bank estimated that all in-person official procedures in Mexico, for example, amount to costs of nearly US$3.3bn a year, or 23% of the federal education budget, while turning to digital could make that bill much lower, as operational expenses for digital paperwork range from 1.5% to 5% of the cost of their in-person alternative.
FIGHTING GRAFT
The slowness of the in-person procedures opens the door for graft. Citing data from Mexico in 2016, one in every 10 large companies experienced corruption at some point that year.
Going digital, the IDB study added, can eliminate several opportunities for corruption as it dispenses with the public officer’s discretionary powers, and makes the procedure traceable and impersonal. “On aggregate, implementation of digital services can reduce the levels of corruption in a country,” it said, quoting a report from India which showed the incidence of bribes falling from 30% to 1% in some cases.
And only in three countries in the region can a person start over half of their paperwork procedures online, led by Uruguay where 100% of procedures can be initiated online, Mexico (88.8%) and Brazil (75.4%).
Political timing sometimes seems to get in the way, as Spanish consultancy Everis’ Chile managing director Mauricio Ríos told BNamericas recently, speaking about projects like President Sebastián Piñera’s digital government app. “There is a lack of leadership … but we are making a big leap in terms of the country’s productivity,” Ríos said.

 

The information presented and opinions expressed herein are those of the author and do not necessarily represent the views of CANTO and/or its members

 

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