2014 Colombia - Telecoms, IP Networks, Digital Media and Forecasts

Mobile network operators expand LTE services following a key spectrum auction

Colombia is included in a group of up-and-coming nations (dubbed CIVETS) which have considerable potential for investors in a range of sectors, including telecommunications. To encourage foreign investment the government, in office since 2010, is shaking off the country’s image as a trouble spot.

Mobile penetration is relatively high for the region. While market growth has slowed in recent years, it retains significant potential, particularly in the mobile broadband sector, which in 2014 has begun to develop rapidly as the five licensees which were awarded spectrum at auction in mid-2014 began to launch commercial LTE services. The market is dominated by three MNOs (Claro, Movistar, and Tigo) though there is a lively MVNO sector to provide additional competition. These include Uff! Móvil, ETB, Móvil Éxito and Virgin Mobile.

Fixed-line teledensity in Colombia is well below the Latin American average. The number of lines in service continues to fall steadily, with customers abandoning traditional phones in favour of mobile and VoIP services. As in other Latin American countries, most of the existing fixed telephone lines are concentrated in the larger cities, leaving the rest of the population under-serviced.

Over the last several years the telecom market has seen a number of mergers, which has intensified competition among the major players. In mid-2014 Tigo merged with the municipally-owned UNE-EPM, enabling the operators to develop converged fixed and mobile services.

Colombia’s broadband penetration is relatively high for the region, though it has been hampered by poor fixed-line infrastructure in many areas of the country. The government has launched several initiatives to increase broadband take-up, including the Vive Digital program and the National Fibre Optic Project.

Key developments:

UNE-EPM merger with Tigo Columbia receives regulatory approval; Claro extends LTE coverage; Avantel launches commercial LTE services; DirectTV launches LTE services; Virgin Mobile and Móvil Éxito launch as MVNOs; Movistar and Claro have licenses extended for ten years; Colombian bank Banagrícola acquires a 70% stake in Uff! Móvil; Avantel plans $250 million investment in LTE; DirecTV launches a fixed and wireless internet service based on its LTE network; government plans COP200 billion investment in national WiFi network to 2018; Azteca Comunicaciones completes 95% of its fibre network; Claro to convert digital TV operation to the DVB-C standard by 2015; AT&T agrees to buy DirectTV’s Latin American operations; National Fibre Optic Project requiring an investment of COP1.2 trillion ($600 million); ETB to cover one million premises with fibre by end-2018; ETB launches its IPTV service; New National Television Authority replaces CNTV for regulating and managing TV services; report includes the regulator’s market data to Q1 2014; operator data to Q2 2014; recent market developments.

Companies and subsidiaries mentioned in this report include:

Movistar (Telefónica Telecom ), Claro (Telmex/Comcel), UNE-EPM, Emcali, Tigo, Avantel, DirecTV, Uff! Móvil, Metrotel, Emcali, Virgin Mobile, Móvil Éxito, Globalstar, Empresa de Telecomunicaciones de Santa Fe de Bogotá (ETB), Telebucaramanga, Edatel, BT Colombia, Calipso, Caucatel, Colomsat, Synapsis, Global TV. 

Data in this report is the latest available at the time of preparation and may not be for the current year