It has been a few years since the end of the telecom sector monopoly in Costa Rica. The Superintendent of Telecommunications Sutel says ending the monopoly has led to great advances for the country’s mobile industry. The mobile telephony penetration rate jumped from 42.38% in 2008 to 101.31% by the end of 2011, while the Internet broadband rate climbed from zero to 70.74%. “This is exponential growth,” noted Sutel’s consul member Walther Herrera, during the TM Forum Latin America Summit.
The country is proud of the increase in fixed Internet broadband access. In 2008, when new telecom legislation was set, 34.42% of households owned a computer, but only 4.12% had Internet access. “The computer cost was high, about US $1,000, so the reason people did not have access to Internet was the lack of infrastructure and coverage,” Herrera noted.
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Costa Rica is not a large country. It has about 4.3 million inhabitants and 31.69 square miles.
The new telecom bill was created in June, 2008. It requires telecom services to have public networks, unlocked SIM cards and mobile telephonies and number portability. Then in 2009 Sutel was created to be a market regulator, working hand in hand with the Ministry of Environment, Energy and Telecommunications (Minaet).
Currently, the numbers make Herrera proud: there are 51 Internet service providers; 60 providers of IP telephony; 24 players in the TV cable sector and eight among IPTV; two MVNOs operating (Tuyo Movil and Full Movil) and seven others with authorization to launch services and three mobile carriers. “It was a drastic change,” noted Sutel’s Herrera.
In a conversation with RCR Wireless News, he did not comment on América Móvil‘s Claro and Telefónica‘s Movistar, new entrants to Costa Rica’s wireless market, requesting to extend their network rollout deadline. The deadline for the first stage of network development, which comprises covering the four biggest provinces, is next July 14.
The second phase is to deploy in major cities within two or three years. And by the fifth year, since carriers own the licenses, they are obliged to deploy mobile services to 95.42% of the national territory.
When asked which market share each carrier will have, Herrera said it is difficult to tell the exactly percentage, but he said he believes it will change. Costa Rica’s government published a report noting the state telecommunications company, Instituto Costarricense de Electricidad (ICE), owned 4 million mobile lines; while Claro accounted for 154,000 while Movistar had 150,000. However, on March 4 this year, Movistar noted that together with Claro, they have reached a half million customers.
Last year, Claro and Movistar both bought licenses and 1 million lines each to start to operate in Costa Rica. According to Herrera, both carriers were granted spectrum in the 850 MHz, 1,800 MHz and 2,100 MHz bands. Due to the spectrum band, Sutel’s board member noted there is no need for extra bidding targeting 4G spectrum. “They deploy LTE, 4G when they want. It is a matter of their business plan,” he told RCR Wireless News.
In addition, he noted Claro and Movistar are deploying 3.5 G telecom services.
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