Chile - Telecom Market and Regulatory Overview - Background Report

Synopsis

Chile’s telecom sector was privatised and opened to partial competition in the 1980s. In 1982, the Chilean government sold its interests in regional telecom companies, Telefónica del Sur and Compañia de Telèfonos de Coyhaique. From 1985, the government also gradually decreased its ownership of Telefónica Chile until, in December 1990, it held less than 0.1%. A Multicarrier Law was passed in March 1994. It amended and broadened the scope of the 1982 Telecommunications Law to introduce a new regulatory framework for long-distance services. With the passing of this law, Entel lost its long-distance monopoly. Competition became fierce, with price wars common. In the first six months after August 1994, prices dropped by 80-90%, but rebounded when companies realised they were losing money. By 1998, long-distance tariffs had been cut by two-thirds and long-distance traffic had nearly trebled. This report provides background information for the more regularly updated Chile - Telecom Market Trends, Key Statistics and Regulatory Overview. As such, it covers details on the history and development of Chile’s telecom market and regulatory framework that are absent from the more up-to-date report, but it does not contain current market trends, analyses, or statistics.