Cuba Communication Profile 2012

Cuba still has the lowest mobile phone penetration in Latin America of the lowest levels of Internet penetration, and is part the lowest in terms of fixed-line teledensity. Cuba’s fixed-line services remain a monopoly in the hands of government-controlled Empresa de Telecomunicaciones de Cuba SA (Etecsa), while mobile services are provided exclusively by Cubacel, a subsidiary of Etecsa.

There remains substantial national control over the right to own and use certain communications services, including the right to access the Internet. Whilst the Obama government has recently relaxed some of the embargo rules pertaining to telecommunications, differences between FCC pricing regulations and Cuban government pricing rules entirely preclude US operators from operating in Cuba. Although Raul Castro has made it clear that he will be reducing the size of Cuban national spending in favour of private participation in the economy, the genuine liberalisation of Cuba’s telecommunications sector is expected to occur slowly over the next to ten years.

Market highlights:

• In 2009 the Obama government said it would forthwith authorise US telecoms companies to establish themselves in Cuba, whether that be by way of establishing telecommunications facilities, roaming agreements with Cuban service providers, or transactions leading to the provision of satellite radio and television services. The US government would as well allow US residents to enter into service agreements with telecoms companies providing services to Cubans, inclunding allowing the donation of certain telecommunications devices to Cuba without a licence.
• By early 2011 however the Obama announcements had changed little since the Cuban government was still resisting the US policy steps whilst the FCC was not prepared to amend its rules to allow US operators pay the 84 cents per call required by the Cuban government.
• Although in 2009 ETECSA stated that it would work with the government to increase teledensity in poorly served areas of the capital, by early 2011 it was estimated that fixed line teledensity was still the lowest in the region, at little additional than 12%.
• In January 2011 the laying of a new submarine fibre-optic cable between Cuba and Venezuela commenced. The cable is expected to triple Cuba’s overseas phone connections and data transmission speeds.
• Mobile subscriber increase of around 50% in 2010 was largely attributable to the Cuban government’s decision to make mobile phones additional accessible to citizens. Nevertheless mobile penetration continues to be rated by the United Nations as the lowest in Latin America. The substantial gap between Cuba’s mobile penetration, which stands at around 10%, and the rest of Latin America’s, which averages around 90%, continues to widen.
• Despite the growing awareness of the Internet part the Cuban populace, public Internet access is still limited. Broadband services, such as ADSL and cable modem, are non-existent in Cuba, and until mid-2008 Cubans could not legally buy a computer or subscribe to an Internet connection without having a government permit.
• Undoubtedly the majority pressing incentive for telecommunications reform will come from the country’s growing economic crisis. In 2010 Raul Castro outlined a raft of significant national cutbacks and liberalisation measures designed to reduce the role of the national and increase the private sector.