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LatAm: End of Cuban embargo to open door for telcos; Ecuador passes new telecom act

With the anticipated end of the U.S. embargo against Cuba, telecommunication services are expected to increase, bringing the country into the 21st century. The general expectation is that Internet access will grow since the U.S. government will start allowing telecommunication companies to set up the necessary equipment and other infrastructure to begin mobile phone and Internet services in Cuba.

The Telecommunications Industry Association, which represents high-tech communications network manufacturers and suppliers, welcomed the opening of Cuba’s telecom market. TIA CEO Scott Belcher said it will allow commercial exports of communications equipment to Cuba. “We look forward to the commercial opportunities that the opening of Cuba represents for the telecommunications sector,” he said.

The international mobile phone top-up provider, ding*, also hailed the U.S. announcement that it would be normalizing diplomatic and economic ties with Cuba and highlighting improved telecommunications as a key focus. Ding* is already a partner of the government-owned telecom service provider Empresa de Telecomunicaciones de Cuba. The company helps Cubans living abroad by offering a way to send support to friends and family living on the island nation. CEO Mark Roden said that “as Cuba gets more connected, ding* will continue to make it easy for the Cuban Diaspora to fuel the power of mobile phones in the island.”

Currently, Cuba has 33.06 telephony lines per 100 inhabitants – or a total of 3.7 million mobile and fixed telephony lines.

New telecom law in Ecuador: The national assembly in Ecuador passed new telecommunications legislation that simplifies regulations and establishes new quality-of-service criteria. The act also imposes a new tax on telecom companies with a “dominant” market share. The legislation was approved with a 93-25 vote after a heated debate.

Operators – except for state-owned companies – which have or exceed a 30% market share must pay a fee to the government. Companies with a market share of more than 30%, such as Claro, will have to pay a tax of 0.5% of their revenue. As the market share of a company increases, so does the rate of taxation. The new Ecuadorian telecom law is also expected to force DirecTV to pay a fee because it leads the pay-TV sector with a 34% market share.

In addition, the new law will create the Telecommunications Control and Regulation Agency, which will replace the current agency Supertel. The new agency will act as a legal public entity with administrative and financial autonomy and its own assets. It will also technically operate under the umbrella of the Telecommunications Ministry and the Information Society.

Venezuela’s latest numbers: The National Telecommunications Commission of Venezuela (Conatel) reported that total telecom industry investment in the country reached $823 million at the end of September, an increase of 105% compared to the same quarter of 2013. Conatel also noted that revenue rose 36.3% to $3.74 billion. Mobile telephony drove the growth, representing 56% of the revenue generated between July and September.

At the end of September, Venezuela had 3.4 million broadband accesses (up 2.1% YoY), 30.1 million mobile subscribers (down 1.2% YoY), and 4.5 million pay-TV subscribers (up 16.5% YoY). Of the country’s mobile access, 70.96% of lines were GSM, and 28.65% were CDMA. Approximately 121,000 lines were LTE. Only Digitel offers 4G services in the country.

More Latin American news:

BRAZIL – Anatel has approved Telefónica’s acquisition of GVT, but the telecom regulator stipulated that Telefónica cannot vote in Telco, the holding company that controls Telecom Italia, the owner of TIM Brasil. The purpose is to avoid Telefónica from interfering with its competitor in Brazil.

MEXICO – The telecom regulator IFT has granted the country’s communications and transport ministry, the SCT, use of the 700 MHz spectrum band to carry out LTE field trials.

COSTA RICA – Millicom has agreed to the terms and conditions to acquire TeleCable Económico TVE and merge the company with its Costa Rican subsidiary. The agreement is subject to regulatory approval.

PERU – Movistar and Ericsson announced a joint project to provide LTE Internet access to government organizations, such as schools and health care centers, in the Peruvian Amazon during 2015. According to Ericsson, this is the first project in Latin America to use LTE. Providing fixed wireless Internet access is difficult because of the geography of the remote rural areas.

Wondering what’s going on in Latin America? Why don’t you follow me on Twitter? Also check out all of RCR Wireless News’ Latin American content.

ABOUT AUTHOR

Roberta Prescott
Roberta Prescott
Editor, [email protected] Roberta Prescott is responsible for Latin America reporting news and analysis, interviewing key stakeholders. Roberta has worked as an IT and telecommunication journalist since March 2005, when she started as a reporter with InformationWeek Brasil magazine and its website IT Web. In July 2006, Prescott was promoted to be the editor-in-chief, and, beyond the magazine and website, was in charge for all ICT products, such as IT events and CIO awards. In mid-2010, she was promoted to the position of executive editor, with responsibility for all the editorial products and content of IT Mídia. Prescott has worked as a journalist since 1998 and has three journalism prizes. In 2009, she won, along with InformationWeek Brasil team, the press prize 11th Prêmio Imprensa Embratel. In 2008, she won the 7th Unisys Journalism Prize and in 2006 was the editor-in-chief when InformationWeek Brasil won the 20th media award Prêmio Veículos de Comunicação. She graduated in Journalism by the Pontifícia Universidade Católica de Campinas, has done specialization in journalism at the Universidad de Navarra (Spain, 2003) and Master in Journalism at IICS – Universidad de Navarra (Brazil, 2010) and MBA – Executive Education at the Getulio Vargas Foundation.