Executive Summary

The Andes mountain system extends for more than 8,900km along the entire length of western South America, from the Caribbean coast in the north to Tierra del Fuego in the south. The Andes form a natural wall separating the narrow western coastal region from the rest of the continent. This territory and it resources are shared by five countries: Bolivia, Chile, Colombia, Ecuador and Peru.

Although Bolivia’s telecom market has been liberalised since November 2001, fixed-line teledensity is still a low 7%. Ethnic conflicts, socio-economic problems and natural disasters all played their part in holding back fixed-line growth – but not mobile, which has grown steadily even during the recession years. Mobile subscribers outnumber fixed phones by more than two to one. Two companies offer GSM/GPRS services, making Bolivia one of Latin America’s most active GSM markets. In 2004, the outlook became a lot more promising. Political conditions stabilised, the economy picked up, and telcos invested US$100 million during the year. Together with mobile telephony, Bolivia’s broadband market became the fastest growing telecom sector in 2004, although it is still remains small compared with neighbouring countries.


Chile’s dynamic telecom market enjoys a state-of-the-art infrastructure and regulatory system. A high level of maturity has been achieved through investment, competition and innovation. But while Chile’s mobile market continues to flourish, the local telephony sector remains flat, mostly due the move towards mobile solutions. Chile has the highest mobile penetration in Latin America: around 61% in early 2005. Mobile subscribers outnumber fixed lines by about 7:3. However, a reduction in fixed-to-mobile interconnection tariffs ordered by the regulator in January 2004, together with an ever increasing proportion of prepaid customers, is contributing to a steady decline in operators’ ARPU. With the merger of Telefónica and BellSouth Chile in January 2005, the number of mobile companies decreased from four to three. The shape of the mobile market changing yet again in 2005, when Telefónica/BellSouth’s returned spectrum is awarded to a fourth player. The country’s broadband market is also a fast growing business, with cable modems growing by around 45% a year and Asymmetrical Digital Subscriber Line (ADSL) by around 108%. Cable modems have traditionally led the broadband market, but in 2004 ADSL lines overtook cable modems.


Thanks to a relatively modern telecom infrastructure and increasing competition, the average teledensity in Colombia is relatively high for Latin America, although there is a steep imbalance between rural and urban areas. Despite the economic rebound, fixed lines continue to stagnate and actually decreased in 2004. This has been attributed to the shift towards alternative technologies and mobile phones. Colombia’s mobile market is one of the fastest growing businesses in the country, with subscribers growing 73% during 2004. Mobile telephones overtook fixed lines in service for the first time in mid-2004. After years of controversy, the government commenced a review of its Voice over Internet Protocol (VoIP) regulations in 2004, and began to issue VoIP licences to a few operators, creating a new window of opportunity. New VoIP licencees launched services in the second half of 2004.


In Ecuador, the fixed-line market has been liberalised since January 2002, but competition is slow to develop, hampered by the dominance of state-owned Andinatel and Pacifictel. Repeated privatisation attempts have failed, and the regulator is looking for a foreign company to take over the management of both operators. Fixed-line teledensity is one of the lowest in South America. Unsatisfied demand, together with regulatory, technological and competitive developments, combine to make the Ecuadorian telecom industry an attractive financial opportunity for investors. The mobile phone market, for example, increased by 50% to 80% a year during 2001-2004. Growth does not appear to have slowed down even during the recession. In early 2005, mobile penetration was well over double the fixed-line rate. Internet uptake is hampered by the lack of telecom infrastructure and low PC penetration. Broadband is freely available, though mostly limited to the corporate market.


Peru’s telecom market has been fully liberalised since 1999, yet Telefónica del Perú still has a near monopoly over the country’s fixed-lines. Lack of competition has stifled growth, and teledensity is among the lowest in South America. Excessively high interconnection rates have been blamed for this state of affairs. On the positive side, a multicarrier system introduced in 2002 has stimulated long-distance competition. Fixed-to-mobile charges were reduced in August 2004 and again in February 2005. The Peruvian mobile sector, on the other hand, has had four companies competing for market share and has expanded rapidly. Mobile phones overtook fixed-lines in 2001. In early 2005, the number of mobile subscribers was more than double the number of fixed lines in service. However, the number of mobile players decreased to three in October 2004, when Telefónica acquired BellSouth Peru, thus securing over 70% of the Peruvian mobile market. Internet use in Peru is above the average for South America – despite poor PC penetration and low teledensity – as many users access the Web from public Internet booths. Most Peruvians still rely on dial-up access, but in 2004, dial-up subscriber numbers were decreasing in favour of new access technologies, especially ADSL, which is the fastest-growing Internet market in Peru.

1. EXECUTIVE SUMMARY
2. BOLIVIA
2.1 Key statistics
2.2 Telecommunications market
2.2.1 Overview of Bolivia’s telecom market
2.3 Regulatory environment
2.3.1 Background
2.3.2 Regulatory authority
2.3.3 Telecom sector liberalisation in Bolivia
2.3.4 Privatisation of Entel
2.3.5 Foreign investment
2.4 Fixed network operators in Bolivia
2.4.1 Overview of operators
2.4.2 Entel
2.4.3 Cooperatives
2.4.4 BoliviaTel
2.5 Telecommunications infrastructure
2.5.1 National telecom network
2.5.2 International infrastructure
2.5.3 Infrastructure developments
2.6 Data communications
2.6.1 Data infrastructure
2.7 Internet market
2.7.1 Overview of the Internet in Bolivia
2.7.2 Bolivia’s ISP market
2.8 Broadband market
2.8.1 ADSL
2.8.2 Wireless broadband
2.9 Convergence
2.9.1 E-commerce
2.10 Mobile communications
2.10.1 Overview of Bolivia’s mobile market
2.10.2 Mobile technologies
2.10.3 Major mobile operators
2.10.4 Mobile voice services in Bolivia
2.10.5 Mobile data services
2.11 Broadcasting market
2.11.1 Free-to-air TV
2.11.2 Pay TV
3. CHILE
3.1 Key statistics
3.2 Telecommunications market
3.2.1 Overview of Chile’s telecom market
3.3 Regulatory environment
3.3.1 Background
3.3.2 Regulatory authorities
3.3.3 Privatisation
3.3.4 Telecom sector liberalisation in Chile
3.3.5 Telecommunication tariffs
3.3.6 Interconnect
3.4 Fixed network operators in Chile
3.4.1 Overview of operators
3.4.2 Telefónica CTC Chile
3.4.3 Entel Chile
3.4.4 VTR Globalcom
3.4.5 Telmex
3.4.6 Manquehue Net
3.4.7 Telefónica del Sur
3.5 Telecommunications infrastructure
3.5.1 National telecom network
3.5.2 International infrastructure
3.5.3 Infrastructure developments
3.6 Data communications
3.6.1 Data infrastructure
3.7 Internet market
3.7.1 Overview of the Internet in Chile
3.7.2 Chile’s ISP market
3.8 Broadband market
3.8.1 Market overview
3.8.2 Broadband operators
3.8.3 Cable modems
3.8.4 ADSL
3.8.5 Wireless broadband
3.8.6 Powerline broadband
3.9 Convergence
3.9.1 E-commerce
3.9.2 E-banking
3.9.3 E-government
3.10 Mobile communications
3.10.1 Overview of Chile’s mobile market
3.10.2 Regulatory issues
3.10.3 Mobile technologies
3.10.4 Mobile operators
3.10.5 Mobile voice services
3.10.6 Mobile data services
3.11 Broadcasting market
3.11.1 Free-to-air TV
3.11.2 Digital Terrestrial TV
3.11.3 Pay TV
3.11.4 Cable TV
3.11.5 Satellite TV
4. COLOMBIA
4.1 Key statistics
4.2 Telecommunication market
4.2.1 Overview of Colombia’s telecom market
4.2.2 Ten-year national development plan
4.2.3 Rural telephony
4.3 Regulatory environment
4.3.1 Regulatory authorities
4.3.2 Privatisation
4.3.3 Telecom sector liberalisation in Colombia
4.4 Fixed network operators in Chile
4.4.1 Overview of operators
4.4.2 Telefónica CTC Chile
4.4.3 Entel Chile
4.4.4 VTR Globalcom
4.4.5 Telmex
4.4.6 Manquehue Net
4.4.7 Telefónica del Sur
4.5 Telecommunications infrastructure
4.5.1 National telecom network
4.5.2 International infrastructure
4.5.3 Infrastructure developments
4.6 Data communications
4.6.1 Overview
4.6.2 Impsat
4.6.3 ISDN
4.6.4 Value-added services
4.6.5 Very Small Aperture Terminal (VSAT) networks
4.7 Internet market
4.7.1 Overview of the Internet in Colombia
4.7.2 Internet access locations
4.7.3 Colombia’s ISP market
4.8 Broadband market
4.8.1 Market overview
4.8.2 Cable modems
4.8.3 xDSL
4.8.4 Wireless broadband
4.9 Convergence
4.9.1 E-commerce
4.10 Mobile communications
4.10.1 Overview of Colombia’s mobile market
4.10.2 Regulatory issues
4.10.3 Mobile technologies
4.10.4 Major mobile operators
4.10.5 Mobile voice services
4.10.6 Mobile data services
4.11 Broadcasting market
4.11.1 Overview
4.11.2 Free-to-air TV
4.11.3 Pay TV
4.11.4 Cable TV
4.11.5 Satellite TV
4.11.6 Interactive TV
5. ECUADOR
5.1 Key statistics
5.2 Telecommunications market
5.2.1 Overview of Ecuador’s telecom market
5.3 Regulatory environment
5.3.1 Background
5.3.2 Regulatory authorities
5.3.3 Privatisation
5.3.4 Telecom sector liberalisation in Ecuador
5.4 Fixed network operators in Ecuador
5.4.1 Overview of operators
5.4.2 Andinatel
5.4.3 Pacifictel
5.4.4 Etapa
5.4.5 Linkotel
5.5 Telecommunications infrastructure
5.5.1 National telecom network
5.5.2 International infrastructure
5.5.3 Infrastructure developments
5.6 Data communications
5.6.1 Data infrastructure
5.7 Internet market
5.7.1 Overview of the Internet in Ecuador
5.7.2 Ecuador’s ISP market
5.8 Broadband market
5.8.1 Market overview
5.9 Convergence
5.9.1 E-services
5.9.2 Business-to-business (B2B)
5.10 Mobile communications
5.10.1 Overview of Ecuador’s mobile market
5.10.2 Major mobile operators
5.10.3 Mobile voice services in Ecuador
5.11 Broadcasting market
5.11.1 Free-to-air TV
5.11.2 Pay TV
5.11.3 Cable TV
5.11.4 Satellite TV
6. PERU
6.1 Key statistics
6.2 Telecommunications market
6.2.1 Overview of Peru’s telecom market
6.3 Regulatory environment
6.3.1 History
6.3.2 Regulatory authority
6.3.3 Privatisation of Telefónica del Perú
6.3.4 Telecom sector liberalisation in Peru
6.3.5 Changes to telecom laws and regulations – 2003-2004
6.3.6 Multicarrier dialling system
6.3.7 Interconnect
6.3.8 Fixed-to-Mobile termination charges
6.3.9 Access
6.3.10 Interoperability
6.3.11 Number Portability
6.3.12 Settlement rates
6.3.13 Callback services
6.3.14 Price cap regulations
6.4 Fixed network operators in Peru
6.4.1 Overview of operators
6.4.2 Telefónica del Perú (TdP)
6.4.3 Comunicaciones Móviles del Perú (CMP)
6.4.4 Telmex Perú
6.4.5 Americatel Perú
6.4.6 Gilat To Home Perú
6.4.7 Millicom Peru
6.5 Telecommunications infrastructure
6.5.1 National telecom network
6.5.2 International infrastructure
6.5.3 Infrastructure developments
6.6 Data communications
6.6.1 Data infrastructure
6.7 Internet market
6.7.1 Overview of the Internet in Peru
6.7.2 Internet booths
6.7.3 Peru’s ISP market
6.8 Broadband market
6.8.1 Market overview
6.8.2 Cable modems
6.8.3 ADSL
6.8.4 Wireless broadband
6.8.5 Powerline broadband
6.9 Convergence
6.9.1 E-commerce
6.10 Mobile communications
6.10.1 Overview of Peru’s mobile market
6.10.2 Regulatory issues
6.10.3 Mobile technologies
6.10.4 Major mobile operators
6.10.5 Mobile voice services in Peru
6.10.6 Mobile data services
6.10.7 Mobile applications
6.11 Broadcasting market
6.11.1 Overview
6.11.2 Free-to-air TV
6.11.3 Cable TV
6.11.4 MMDS
6.11.5 Satellite TV
7. GLOSSARY OF ABBREVIATIONS


Exhibit 1 – Local and public telephone operators - 2004
Exhibit 2 – Domestic and international long-distance coverage by operator - 2004
Exhibit 3 – Major submarine cable networks landing in Bolivia
Exhibit 4 – Bolivian ISPs - 2003
Exhibit 5 – Tariff regulations on telecommunication services
Exhibit 6 – Operating regions
Exhibit 7 – Local telephone operators – 2004
Exhibit 8 – Long-distance telephone operators:
Exhibit 9 – Telefónica CTC Chile at a glance
Exhibit 10 – Entel Chile at a glance
Exhibit 11 – VTR Globalcom at a glance
Exhibit 12 – Major submarine cable networks landing in Chile
Exhibit 13 – ISPs in Chile – June 2004
Exhibit 14 – Operating regions
Exhibit 15 – Local telephone operators – 2004
Exhibit 16 – Long-distance telephone operators
Exhibit 17 – Telefónica CTC Chile at a glance
Exhibit 18 – Entel Chile at a glance
Exhibit 19 – VTR Globalcom at a glance
Exhibit 20 – Major submarine cable networks landing in Chile
Exhibit 21 – Major Internet Service Providers
Exhibit 22 – Mobile operators by region
Exhibit 23 – Television channels - 2004
Exhibit 24 – Breakdown of Colombian cable operators
Exhibit 25 – Major submarine cable networks landing in Ecuador
Exhibit 26 – FITEL Rural Projects Program
Exhibit 27 – Major submarine cable networks landing in Peru
Exhibit 28 – Principal nationwide broadcasting channels




Table 1 – Country statistics Bolivia – 2003
Table 2 – Telephone network statistics – 2003
Table 3 – Internet provider statistics – 2003
Table 4 – Internet user statistics – 2003
Table 5 – Mobile statistics – September 2004
Table 6 – National telecommunications authorities
Table 7 – Fixed-line versus mobile market share – 1995 - 2003
Table 8 – Fixed lines in service and teledensity – 1995 - 2003
Table 9 – Public payphones in service - 1997 - 2003
Table 10 – Internet users and user penetration - 1997 - 2003
Table 11 – Internet subscribers – 1997 - 2003
Table 12 – Internet host computers - 1996 - 2003
Table 13 – Mobile subscribers by operator - September 2004
Table 14 – Mobile operators’ market share - September 2004
Table 15 – Mobile subscribers and penetration - 1995 - 2004
Table 16 – Cable TV subscribers – 2000 - 2003
Table 17 – Country statistics Chile – 2003
Table 18 – Telephone network statistics – June 2004
Table 19 – Internet provider statistics – 2003
Table 20 – Internet user statistics – 2003
Table 21 – Broadband statistics – June 2004
Table 22 – Mobile statistics – September 2004
Table 23 – National telecommunications authorities
Table 24 – CTC lines in service – 1999 - 2004
Table 25 – Entel DSL, IDL market share and ADSL/WLL and local fixed lines subscribers – 2001 - 2004
Table 26 – VTR telephone and Internet subscribers – 2000 - 2004
Table 27 – Telsur lines in service and ADSL subscribers – 1999 - 2003
Table 28 – Fixed lines in service – 1997 - 2004
Table 29 – Entel Chile data lines by technology – 2000 - 2004
Table 30 – Internet users and user penetration - 1996 - 2003
Table 31 – Dial-up Internet subscribers – 2000 - 2004
Table 32 – Internet host computers - 1994 - 2003
Table 33 – Broadband subscribers - 2000 - 2004
Table 34 – Broadband subscribers by technology – 2001 - 2004
Table 35 – Broadband subscribers by selected companies – 2003
Table 36 – Broadband subscribers by major companies – 2001 - 2004
Table 37 – Cable modem subscribers – 2001 - 2004
Table 38 – ADSL subscribers – 2001 - 2004
Table 39 – Entel – WLL subscribers – 2002 - 2004
Table 40 – Mobile subscribers by operator – September 2004
Table 41 – Operator market share – 2003 - 2004
Table 42 – Mobile subscribers and penetration – 1995 - 2004
Table 43 – Entel PCS prepaid/post-paid mobile subscribers and market share – 1999 - 2004
Table 44 – Telefónica Móvil mobile subscribers – 1998 - 2004
Table 45 – BellSouth Chile mobile subscribers – 1999 - 2004
Table 46 – Smartcom mobile subscribers – 1999 - 2004
Table 47 – Prepaid and post-paid subscribers – 1999 - 2004
Table 48 – VTR cable TV and DTH subscribers – 2000 - 2004
Table 49 – Country statistics Colombia 2003
Table 50 – Telecom revenue and investment statistics – 2003
Table 51 – Telephone network statistics – 2004
Table 52 – Internet provider statistics – 2003
Table 53 – Internet user statistics – June 2004
Table 54 – Broadband statistics – June 2004
Table 55 – Mobile statistics – 2004
Table 56 – Telecommunications organisations
Table 57 – Telecommunications revenue – 2000 - 2003
Table 58 – Telecommunications revenue by segment – 2003
Table 59 –Telecommunications investment – 2001 - 2003
Table 60 – CTC lines in service – 1999 - 2004
Table 61 – Entel statistical overview – 2001 - 2004
Table 62 – VTR telephone and Internet subscribers – 2000 - 2004
Table 63 – Telsur lines in service and ADSL subscribers – 1999 - 2003
Table 64 – Fixed lines in service – 1997 - 2004
Table 65 – VAS revenues - 2000 - 2004
Table 66 – Internet users and user penetration - 1996 - 2004
Table 67 – Dial-up/broadband users and subscribers – 2002 - 2004
Table 68 – Internet user distribution by technology – 2002 - 2004
Table 69 – Internet host computers – 1996 - 2003
Table 70 – Dedicated subscribers (cable modem, xDSL, other) – 2001 - 2004
Table 71 – Mobile subscribers by operator - September 2004
Table 72 – Mobile market share by operator – 2002 - 2004
Table 73 – Mobile subscribers and penetration – 1997 - 2004
Table 74 – Comcel – mobile subscribers – 2000 - 2004
Table 75 – BellSouth Colombia – mobile subscribers – 2001 - 2004
Table 76 – Colombia Móvil – mobile subscribers – 2003 - 2004
Table 77 – Free-to-air TV market share – February 2005
Table 78 – Pay TV subscribers – 1997 - 2002
Table 79 – DTH satellite TV subscribers - 1999 - 2002
Table 80 – Country statistics Ecuador – 2003
Table 81 – Telephone network statistics – 2004
Table 82 – Internet provider statistics – 2003
Table 83 – Internet user statistics – 2004
Table 84 – Mobile statistics – January 2005
Table 85 – National telecommunications authorities
Table 86 – Market share of mainlines in service by operator – 2001 - 2004
Table 87 – Andinatel mainlines in service – 2001 - 2004
Table 88 – Pacifictel mainlines in service – 2001 - 2004
Table 89 – Etapa mainlines in service – 2001 - 2004
Table 90 – Linkotel mainlines in service – 2004
Table 91 – Fixed lines in service - 1996 - 2004
Table 92 – Public telephones by operator – 2001 - 2004
Table 93 – Internet users and user penetration - 1998 - 2004
Table 94 – Internet subscribers – 1998 - 2004
Table 95 – Internet host computers - 1995- 2003
Table 96 – Internet subscribers by ISP - 2004
Table 97 – Mobile subscribers by operator - January 2005
Table 98 – Mobile market share – 1996 - 2005
Table 99 – Mobile subscribers and penetration - 1996 - 2005
Table 100 – Conecel mobile subscribers – 1996 - 2005
Table 101 – Otecel mobile subscribers– 1996 - 2005
Table 102 – Alegro mobile subscribers – 2003 - 2005
Table 103 – Prepaid subscriber ratio by operator – 2002 - 2005
Table 104 – Pay TV subscribers by technology – January 2005
Table 105 – Country statistics Peru – 2003
Table 106 – Telecom revenue and investment statistics – 2003
Table 107 – Telephone network statistics – June 2004
Table 108 – Internet provider statistics – September 2004
Table 109 – Internet user statistics – June 2004
Table 110 – Mobile statistics – 2004
Table 111 – National telecommunications authorities
Table 112 – Number of lines and market share by company – 2004
Table 113 – Lines in service by company – 2001 - 2004
Table 114 – Fixed-lines share by company – 2001 - 2004
Table 115 – Share of domestic long distance traffic per major operator – 2002 - 2004
Table 116 – Share of international long distance traffic per major operator – 2002 - 2004
Table 117 – Number of licensed operators per service – July 2004
Table 118 – Fixed lines overview and teledensity - 1995 - 2004
Table 119 – Public telephones – 1997 - 2004
Table 120 – Telefónica del Perú ISDN lines – 2001 - 2004
Table 121 – Internet users and user penetration - 1996 - 2004
Table 122 – Internet subscribers by access - 2001 - 2004
Table 123 – Internet subscriber distribution - 2001 - 2003
Table 124 – Internet host computers - 1995 - 2003
Table 125 – Dial-up market share by ISP - Sep 2004
Table 126 – Cable modem subscribers by operator – 2001 - 2004
Table 127 – TdP ADSL subscribers – 2001 - 2004
Table 128 – Mobile subscribers by operator - 2004
Table 129 – Mobile subscribers and penetration - 1994 - 2004
Table 130 – Company market share – 1994 - 2004
Table 131 – Prepaid subscribers by company – 2001 - 2004
Table 132 – Contract subscribers by company – 2001 - 2004
Table 133 – Telefonica del Peru mobile subscribers - 2001 - 2004
Table 134 – Comunicaciones Móviles del Perú mobile subscribers - 2001 - 2004
Table 135 – TIM Peru prepaid and postpaid mobile subscribers - 2001 - 2004
Table 136 – Nextel prepaid and postpaid subscribers - 2001 - 2004
Table 137 – TV channel ratings and market share - August 2004
Table 138 – Cable TV subscribers in Peru – 1999 - 2004
Table 139 – Cable Mágico subscribers – 1999 - 2003