Virus impact over each market - telecom operators, government agencies and regulators' responses - revised forecasts for the next 5 years.
Although Bolivia has enjoyed strong economic growth in recent years, GDP remains among the lowest in South America. Many areas of the country outside the main cities are poor and undeveloped, and there is a sizeable proportion of the population which live in remote valleys and areas where telecom infrastructure has been chronically neglected. As a result, the penetration of telecom services is relatively low.
The structure of Bolivia’s fixed telecom market is different from most other countries. Local services are primarily provided by 15 telecom cooperatives. These are non-profit-making companies privately owned and controlled by their users. Since the market was liberalised the cooperatives have also provided long-distance telephony, while several also offer broadband and pay TV services. They have invested in network upgrades in a bid to improve services for customers, and to expand their footprints.
Bolivia has a multi-carrier system wherein consumers can choose a long-distance carrier for each call by dialling the carrier’s prefix. A number of operators have also adopted fixed-wireless technologies, and some rent fibre-optic capacity.
State-owned Empresa Nacional de Telecomunicaciones (Entel) is the country’s incumbent long-distance operator, also offering local telephony, DSL and satellite pay TV services. Its subsidiary Entel Movil is Bolivia’s largest mobile network provider.
Bolivia’s fixed broadband services remain expensive, though the cost of bandwidth is only a fraction of what it was only a few years ago. Services are still unavailable in many rural and remote areas, and even in some of the major urban areas. Being a landlocked country, Bolivia has no direct access to submarine cable networks and must therefore connect to the rest of the world either via satellite or through terrestrial links across neighbouring countries. Fixed broadband services are fast migrating from DSL to fibre, while there are also cable broadband services available in some major cities.
Since it was renationalised in 2007 Entel has focused on providing telecom services in rural areas under a project known as ‘Territory with Total Coverage’. This project aims to increase telecom coverage through mobile rather than through fixed networks.
Bolivia has more than ten times as many mobile phones as fixed lines, and the trend towards fixed-mobile substitution continues. Besides Entel, another two companies offer mobile telephony: Tigo, wholly owned by Luxembourg-based Millicom International, and NuevaTel, trading as Viva and controlled by US firm Trilogy International. A proposed deal to merge Millicom’s business units in the region with those of Liberty Latin America was called off in February 2019.
All three mobile companies offer 3G services while LTE is available. Due to the poor quality, high cost, and poor reach of DSL, mobile networks have become the principal platform for voice services and data access. The take-up of services based on LTE has risen steadily as network builds have been increased. Tigo launched the first LTE services in mid-2014, followed by Viva in mid-2015 and by early 2019 both companies’ networks reached more than 90% of the population. About 92% of all internet accesses are via smartphones.
BuddeComm notes that the outbreak of the Coronavirus in 2020 is having a significant impact on production and supply chains globally. During the coming year the telecoms sector to various degrees is likely to experience a downturn in mobile device production, while it may also be difficult for network operators to manage workflows when maintaining and upgrading existing infrastructure. Overall progress towards 5G may be postponed or slowed down in some countries.
On the consumer side, spending on telecoms services and devices is under pressure from the financial effect of large-scale job losses and the consequent restriction on disposable incomes. However, the crucial nature of telecom services, both for general communication as well as a tool for home-working, will offset such pressures. In many markets the net effect should be a steady though reduced increased in subscriber growth.
Although it is challenging to predict and interpret the long-term impacts of the crisis as it develops, these have been acknowledged in the industry forecasts contained in this report.
The report also covers the responses of the telecom operators as well as government agencies and regulators as they react to the crisis to ensure that citizens can continue to make optimum use of telecom services. This can be reflected in subsidy schemes and the promotion of tele-health and tele-education, among other solutions.
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