Universal Service in Latin America: Recent evolution and future challenges

1
Universal Service in Latin America Recent
evolution and future challenges

• Claudio Feijóo González 1
• José Luis Gómez Barroso 2
• Arturo Robles Rovalo 1

1 Grupo de Tecnologías de la Información y las
Comunicaciones (GTIC) Dpto. SSR.
E.T.S.I.Telecomunicación. Universidad Politécnica
de Madrid (Spain) arobles cfeijoo
_at_gtic.ssr.upm.es 2 Dpto. Economía Aplicada e Hª
Económica Universidad Nacional de Educación a
Distancia (UNED), Madrid (Spain) jlgomez_at_cee.uned.
es
2
Latin America Liberalization

• 80s 90s Telecommunication industry
  liberalization and reform
• Increase telephone network acquiring real and
  sustainable competition
• Governments interest all population access to
  basic telecommunication services ? specific tools
  and concepts

3
Universal Concept

• Universal Access concept
• Community Access oriented existence of means by
  which everybody can access to the service
  telephone sets within a reachable distance to
  every body
• US precursor

• Universal Service concept
• Individual Access oriented one phone-set per
  home
• Individual connection to the public
  communications network

4
Telephone Network Evolution BRAZIL

• 1995 Constitutional amendment allowed private
  investment
• 1997 General Telecommunications Law and
  Universalisation General Plan Goals
• 1999 highest growth after Telebras auction
• 2000 entrance of mirror companies after
  exclusivity period
• 2001 Anticipated goal achievement (2003
  objective)
• 2002 slow down in fixed line growth
• 2004 Fixed teledensity 25
• Mobile teledensity 28

Source own elaboration with data from ITU and
ANATEL
5
Telephone Network Evolution CHILE

• 1978 pioneer country in liberalization and
  reform processes
• 1982 Telecommunications General Law
• 1990 important growth after entire incumbent
  privatization
• 1994 fall reaction introducing new local
  operators Telecom. development Fund (FDT)
  creation
• 1995 99 positive network expansion
• 2000 04 network deployment has slowed down
• 2004 Fixed teledensity 21,7
• Mobile teledensity 42,6

Source own elaboration with data from ITU and
SUBTEL
6
Telephone Network Evolution MEXICO

• 1989 1992 government sold Telmex
• 1990 highest growth
• 1990 94 Telmex exclusivity period
• 1997 fall reaction local service competiton
  and COFETEL creation
• 2000 06 Transport Sectorial Program
• 2004 Fixed teledensity 16
• Mobile teledensity 28,6

Source own elaboration with data from ITU and
COFETEL
7
Telephone Network Evolution PERU

• 1991 Telecommunications Law allowed private
  investments
• 1991 94 Creation of OSIPTEL
• 1995 highest growth after government operator
  privatization
• 1995 1998 exclusivity period ends
• 1999 network deployment slowed down
• 2001 new local service operator and FITEL fund
  activation.
• 2004 Fixed teledensity 6,9
• Mobile teledensity 11,5

Source own elaboration with data from ITU and
OSIPTEL
8
Latin America US Programs
Universal Service Programs basic elements
Source own elaboration with data from COFETEL,
SUBTEL, ANATEL y OSIPTEL
9
Latin America US Programs

• Different programs created for the telephone
  network expansion agree in their basic
  principles
• liberalization and sector reform, incumbent
  monopoly privatisation,
• introduction of the competition in fixed and
  mobile markets
• operators financial contributions to encourage
  the Universal Service objectives.
• the law define the Universal Service obligations
  and a specific development program exists.

Source own elaboration with data from COFETEL,
SUBTEL, ANATEL y OSIPTEL
10
Results

• LiberalizationPrivatizationRegulation triangle
  ? short term network increase
• Positive network growth
• Brazil and Chile obtained the best results
  Incentives based programs
• Effectiveness of US programs has been held back
  by non fulfillment commitments Mexico and Peru

11
Results

• Fixed teledensity has recently slow down
• Recent US programs subordination to a more
  general Information Society Programs
• Penetration was still low
• Superiority in grow of the mobile sector
  fix-mobile substitution phenomena

12
Conclusions

• Current US designed programs Increase all
  population basic service offer without
  considering their specific needs
• Conventional US concept a telephone set per
  home linked with fixed service (technologically
  dependent)

13
Conclusions

• A wide review of the US current practices and
  technologies adopted, keeping in mind
• conventional US objectives
• non-voice services (include in the US definition)
• present and future users requirements (broadband,
  mobility)
• US future evolution
• Public Policies and Support
• Take advantage of the current demand and the
  autonomous market impulse

14
Universal Service in Latin America Recent
evolution and future challenges

• Claudio Feijóo González 1
• José Luis Gómez Barroso 2
• Arturo Robles Rovalo 1

1 Grupo de Tecnologías de la Información y las
Comunicaciones (GTIC) Dpto. SSR.
E.T.S.I.Telecomunicación. Universidad Politécnica
de Madrid (Spain) arobles cfeijoo
_at_gtic.ssr.upm.es 2 Dpto. Economía Aplicada e Hª
Económica Universidad Nacional de Educación a
Distancia (UNED), Madrid (Spain) jlgomez_at_cee.uned.
es