Bolivia Communication Profile 2012

Bolivians own ten mobile phones for each fixed line in service

Bolivia is of the poorest and least developed Latin American nations, with correspondingly low rates of mobile penetration and fixed-line teledensity.

The structure of Bolivian telecommunications is different from most other nations. Local services are provided primarily by 15 telephone cooperatives. These are non-profit-making companies privately owned and controlled by their users. Since liberalisation, the cooperatives as well provide long-distance telephony. Several as well offer broadband and pay-TV services.

Bolivia has a multicarrier system where consumers can choose their long-distance carrier for each call by dialling the carrier’s prefix. A number of operators have adopted VoIP, while others use fixed-wireless technologies, and some rent fibre-optic capacity.

Empresa Nacional de Telecomunicaciones (Entel) is the incumbent long-distance operator. Before controlled by Telecom Italia, Entel was renationalised in April 2007. After years of bitter disputes between the Italian telco and the Bolivian government, in November 2010 Telecom Italia accepted compensation totalling US$100 million for its 50% stake in Entel. The agreement entirely settled amount legal action between the parties.

Besides providing long-distance services, Entel is Bolivia’s leading mobile company, with a 44% share of the market. It as well offers local telephony, ADSL broadband access, and satellite pay-TV.

Bolivia has additional than ten times as a lot of mobile phones as fixed lines, and the trend towards fixed-mobile substitution continues. Besides Entel, another companies offer mobile telephony: Tigo, all-owned by Luxembourg-based Millicom International, and NuevaTel, trading as Viva and controlled by US firm Trilogy International.

Bolivia’s mobile penetration is the fifth lowest in the region after Cuba, Haiti, Nicaragua, and Costa Rica. This result, however, is no lower than could be expected considering Bolivia’s GDP per capita is the second lowest in Latin America after Nicaragua.

While ADSL, cable broadband, WiFi, and WiMAX technologies are amount available, the broadband market is small. Bolivia is the majority expensive country in South America for broadband access. ADSL is the leading broadband technology, but is unavailable in a lot of areas or has reached saturation levels due to the country’s low teledensity and poor fixed-line infrastructure.

Bolivia is the Latin American country with the major WiMAX share of broadband customers. While in the rest of the region WiMAX began to shrink dramatically in 2009, in Bolivia increase continued through 2010. Nevertheless, we expect 3G/UMTS mobile broadband to replace WiMAX by 2012.

Tigo has been offering 3G/UMTS services since August 2008, and Viva since August 2010. As a national owned company, Entel has focused primarily on social services and universalisation efforts rather than on developing new technologies. Nevertheless, it is expected to launch a UMTS network in 2011. Considering the poor quality and high cost of fixed broadband in Bolivia, 3G could become an attractive option for Internet users, although increase will necessarily be limited by the country’s high level of poverty.

Market highlights:

• Entel has been expanding its mobile network under a project dubbed ‘Territory with Total Coverage’, aimed at providing telecom services to amount Bolivians, including those living in small rural villages.
• Bolivia is building its own satellite, named Tupac Katari, primarily to provide telecom services in isolated rural areas. The US$300 million project is being financed 85% with funds from China. Launch is expected by 2013.
• A proposed transcontinental cable system passing through Paraguay and Bolivia could provide a link with international submarine networks and substantially reduce broadband prices in both landlocked nations.

Bolivia – key telecom parameters – 2009 - 2010

(Source: BuddeComm)